Cao Calls on House Colleagues to Consider Raising Oil Company Liability Cap for Spills

June 9, 2010

WASHINGTON, D.C. – Today, Congressman Anh “Joseph” Cao (LA-02) called on colleagues in the U.S. House of Representatives to consider raising the $75 million liability cap on economic damages that oil companies can be forced to pay oil spill victims, like fishermen, for damages. Cao talked of the need for an increase at a hearing of the Transportation and Infrastructure Committee to address financial responsibility under the Oil Pollution Act of 1990 in the wake of the BP disaster in the Gulf of Mexico.

Cao said, “Should Louisiana fishermen lose this and some foreseeable seasons because of the spill, the costs will far exceed $75 million. According to the National Oceanic and Atmospheric Administration and the American Sportfishing Assocation, commercial and recreational fisheries contribute more than $41.7 billion a year to the nation’s economy, a big portion of which directly impacts the Gulf Coastal states. This amounts to more than 300,000 jobs. And that’s not counting the economic impact of the service, tourism and maritime industries.”

Cao pointed out that since the April 20th explosion of the Deepwater Horizon oil rig triggered a massive leak from the sea floor well it was drilling, BP has spent more than $1.25 billion on cleanup costs and claims. But, he asked, “how can we guarantee the next company that causes a leak will do the same?”

During today’s hearing, the Committee learned the $2.7 billion Oil Spill Liability Trust Fund, created in 1986 and funded under the Oil Pollution Act of 1990, is nearly depleted, as funds are are being fast spent to clean up the BP spill.

Cao cautioned that the Obama administration’s call for a six-month moratorium on deepwater drilling, while meant to improve safety on offshore rigs, could have “unintended consequences.” He pointed out the move could cost Louisiana more than 40,000 jobs at a time when the state’s economy is already reeling from the impact of the spill. Cao said he and the rest of Louisiana’s House Congressional delegation wrote a letter to Interior Secretary Ken Salzar yesterday, demanding an explanation for the decision to cut off a critical source of income to the state.

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