BP and Dalian Oil Spills

BP and Dalian oil spills:

This has been an ongoing idea I’ve had since even before the first anniversary of the BP oil spill.  While the BP disaster gripped the world’s attention throughout the summer of 2010, I was personally horrified by a similar disaster that struck the Chinese coastal city of Dalian that very summer.  I often visited Dalian as an escape from Changchun; the seafood is fresh, the coasts are beautiful and tourist sites like the Seashell Museum and “Chinese Sea World” are pretty fun.

Although the causes of each disaster are different, the BP blowout happened at a deepwater facility while Dalian occurred from an onshore pipeline blowout, the simple fact is that these two events are the worst oil disasters in Chinese and the US history.  As such, there are several relevant questions that can be asked when looking at the disasters through comparative lenses.

What are similarities, differences?

Are there lessons that can be learned?

Can those lessons be shared?

This is indeed an area where bridges can be formed between the US and China, where information sharing can help foster ties between these two nations.  All too often, editorials in both Chinese and US papers fret over conflicts of interest when cooperation can be mutually beneficial.  Oil spill responses are a shared imperative, and while preventing future spills is the best defense, eventualities must be formed in case a nightmare scenario occurs yet again.

The Root Cause of Disaster: Negligence.

According to the spill commission report issued in Jan. 2011, the BP spill was avoidable and happened because of systemic issues involving the regulatory regime.   The failed track record of BP alone should have been a red flag.  In China’s case, pipeline operators neglected their duty,, and were not able to close the pipeline until nearly 200,000 barrels of oil spewed onto the surrounding coast.

Could the Dalian operators have been drinking on the job?

Anecdotal evidence suggests this is not too far fetched to believe.  Less than a year after China’s worst oil spill, a scandal broke involving Sinopec, the largest oil company in China.  Sinopec officials reportedly purchased $200,000 in foreign wine and Moutai Baijiu, evidence of systemic problems in the industry.

http://www.cncworld.tv/news/v_show/14427_Oil_giant_booze_scandal.shtml

  China Petroleum Corp (CNPC) was responsible for the Dalian spill, but judging from this breaking scandal oil companies have learned nothing since the oil spill.

At Sea Vs On the Coast

Actually, this point gets me pretty heated when people claim these two disasters are nothing alike.  In the Dalian case, 200,000 barrels of oil spread along the beaches and devastated the ecosystem immediately following the blowout.  It took a few months, but eventually the BP spill also reached the Gulf coastline.  Coastal cleanup efforts occurred in both countries, similarities and differences abound.  Manual labor was required in both cases, yet the US cleanup crews were careful to not make skin contact with oil, while in China crews simply cupped their hands and put the oil in buckets.  The pictures speak volumes.

                                                          BP Oil Clean up Crews

                                             Dalian Firefighters, clean up crews (Lu Gang)

                                            A photo of Dalian fishing boats I took in 2008

                                                          Fishing boats after the spill

Who’s Affected By the Spill?

Dalian is renowned throughout China as a fishing hub.  I never ate fish in Changchun, where 40% of all mercury poisoning cases are attributed to tainted fish (Source: China’s Mercury Problem: A Sleeping Giant by Celia Y. Chen in Wilson Center China Environment Series Issue 10), however Dalian is a different story.  Oysters, clams, squid, you name the seafood and I enjoyed it in Dalian!  But now that the fisheries have been inebriated with oil, is it safe to eat?

In the US, people with highly tuned noses systematically smelled for the presence of oil in shrimp and fish, where an absence of oil meant it was safe to eat.  I don’t know how the Chinese determined the safety of their seafood.  Apparently the American method works, we’re still eating Gulf Coast shrimp, and this bit of information could be passed on.

Compensation: Complicated in Both Countries

Both oil spills occurred during the summer, which is peak season for visitors in both countries. 

While I have not visited every beach in China, I have had the opportunity to visit Dalian four times.  While the beaches are nothing to gush about, they are still pleasant if a little small.  For many Chinese people, the opportunity to visit a beach is something special, and with an upward moving society more and more people are able to take time off and visit locales.  Dalian is a prime destination, and when the oil spill occurred those tourists were scared off.

The realm of compensation is complicated.  It’s a mental exercise to think about the many people who were affected by the spill.  Street venders had no one to sell their wares to.  Hotels went empty.  Restaurants were empty.  Bars failed to attracted tourists.  Sea World, and all the employees, missed out on their summer tourist season.  Fishermen were especially affected.  As far as their livelihood is concerned, they missed out on time at sea doing their jobs because trawlers were drafted to clean up the oil.  Questions abound on whether the fish population was affected; the long-term affects are still unknown.  The list goes on and on and on.

Multi-million dollar Dalian beach property has certainly been affected as well.  Xinghai Square, and all the surrounding apartments, are some of the most expensive property in all of China.  Will property owners be compensated as well?

The same situations can be applied to Gulf Coast residents.  Hotels that would normally be filled, restaurants that would be bustling with activity, beach venders and bartenders failed to make their summer earnings.  It’s complicated, and the economic effects stretch across the continental US.  I even heard restaurants in Washington, D.C. lost potential income because oysters from the Gulf, which under normal circumstance would be available, were not sold and revenue was lost.  Fishermen were out of work.  BP must and will pay, and the system of compensation should be examined.  It would seem China Petroleum ought to be held accountable for every life affected economically, just as in the BP and American case.

Medical claims

The oil spills present an opportunity to document the medical effects of contamination by oil on the human body.  As David Kennedy, the lead scientist at NOAA, explained at a CSIS event last March, the human costs are to be considered before anything else.  What is certain is that several clean up workers in the Gulf of Mexico were hospitalized; however, heat exhaustion may have also played a role.  Long-term consequences are as yet unknown.

In China, however, human bodies were literally used to soak up the oil.  Crews of fishermen jumped in the water to pick up as much oil off their bodies before rinsing off and jumping in again.  The photos are shocking. Lu Guang received an award for his photojournalism. http://www.greenpeace.org/international/en/news/Blogs/makingwaves/dalian-oil-spill-photographer-receives-award-/blog/34625.

What the US can learn, if at all possible, are the immediate short-term health effects of those clean up crews who were covered head-to-toe.  A joint Chinese/US case study could be useful in determining long-term health effects.

Laws on the Books

There are specific oil laws on the books in the US.  Many of these laws came to be following the Exxon Valdez disaster in the late 1980’s .  There are specific penalties that deal with spilled oil on a per barrel basis, and two degrees of fines based on negligence or gross negligence.  In BP’s case, the Department of Justice will most certainly be enacting a lawsuit based on gross negligence.

There are currently no oil specific laws on the books in China.  However, that does not mean China Petroleum will get away Scott clean.  As professor Yu Wenxuan, an environmental lawyer at the Center for Legal Assistance to Pollution Victims, informed me in an email exchange, CNPC will be fined under “industrial waste law.  The oil company will still be forced to pay, but will probably get away with paying a lot less than BP.  As China looks to expedite the process of enacting spill laws, perhaps it is worth looking at the US as a model.

Big Difference: An Open Society or Quiet Competence

The public demanded that BP reveal the extent of the disaster via a live streaming “spill cam”.  Anyone could see the magnitude of the spill.  Independent experts were able to offer their own assessments on the amount of oil being released, which changed from 3,000 barrels per day, to 5,000, then 12,000 and ultimately 20,000.  An open society matters, because fines are assigned based on the number of barrels- BP would have much preferred to minimize the assessments.

There is no equivalent to a third party distributor like Ken Fineberg of China.  Although he has gotten flack recently for delaying the $20 billion BP fund to victims, at the very least people are able to file their claims and check in on their progress.

For now, all that’s known about the China case is that the company will pay for medical expenses and costs of the clean up.  They are also being fined based on industrial waste laws, yet without specific stipulations this may not turn out to be enough.  What is known is that a scant three weeks after the Dalian spil the local authorities claimed everything was back to normal, an assessment that has been sharply disputed by Greenpeace.

At the same time, given the public-private nature of CNPC, the Company and government response was coordinated.  The full extent of the damage in Dalian was known right away to the government, and responses were formed.  BP, on the other hand, was able to conceal the extent of the spill for three weeks from the US government, according to David Kennedy at NOAA.  This level of corporate-government cooperation is a lesson the US can learn from China’s case.

Restoring the Gulf of Mexico and the Bo Hai Sea

There are currently no laws on the books in the US that stipulate use of BP funds to restore the Gulf of Mexico.  I am not sure about the current state of play in China and the Bo Hai Sea.

A summary of lessons learned and information that can be shared

*When determining contaminated seafood, the Chinese can learn from the US in terms of using fine-tuned noses that can detect the presence of oil in food.

*China can also learn from the US regarding specific oil spill laws.

*As the Department of Justice prepares it’s lawsuit against BP regarding human health costs associated with oil contamination, it is worth noting China’s own human health costs from their first responders.  If local authorities are unwilling to release this health information, it would be a clear sign China Petroleum Corp is winning.

*The US can also learn from the coordination of the Chinese response, in which government and company responses were crafted immediately following the blowout.

Lessons for the Immediate Future:

As Chinese oil companies seek to extract oil from other countries, especially Lake Albert in Uganda, an ecologically fragile system, it is important that they learn from their own mistakes and the mistakes of BP.  Should an oil spill occur in Uganda as a result of negligence, the companies cannot expect local Ugandans to risk oil contamination the way it played out in Dalian.  Another lesson would be how the US government reacted harshly to a foreign company- any future exploration by Chinese companies need to keep in mind they will be prosecuted should the worst occur outside Chinese territory.