Friday, November 24, 2006 Damage from barge sinking may be covered by IOPC Fund: lawmaker
COMMUNITIES affected by the sinking of a barge carrying debris from the oil spill off Guimaras Island may also seek compensation from the International Oil Pollution Compensation (IOPC) Fund, House Deputy Majority Leader Eduardo Gullas said.
Gullas, who represents Cebu province's first district, pointed out that under IOPC rules, "costs incurred for preventive measures and further loss or damage caused by preventive measures" following an oil spill "may be compensated."
"In principle, the IOPC recognizes that following an oil discharge, the massive efforts to contain pollution damage are bound to cause further economic losses, disruptions and in some cases, even environmental issues with use of chemicals to treat the spill, or in this case the sinking of a vessel involved in the cleanup operation," Gullas said.
The Motor Barge Ras capsized off the Municipality of Plaridel in Misamis Occidental Monday. It was carrying 630 tons of contaminated rock and sand. The barge was contracted by the insurer of Sunshine Maritime Development Corp., the owner of the Motor Tanker Solar I that sank off Guimaras on August 11.
The IOPC Fund is part of an international regime of liability and compensation for oil spill damage. Under the system, the owner of a tanker and/or its insurer is liable up to a certain limit for damage following a spill. If that amount does not cover all admissible claims, further compensation is available from the IOPC Fund.
The IOPC Fund is financed by levies on certain types of oil carried by sea. The levies are paid by entities that receive oil after sea transport. Petron Corp. had said the IOPC Fund would extend a total of $315 million to cover "pollution damage" as a result of the Solar I incident. This would cover cleanup costs, spoiled property and consequential losses.
Petron, which owned the oil that was being transported by the Solar I, earlier said it had chipped in a total of P120 million to the IOPC Fund since 1999.
Gullas, meanwhile, renewed his call for the Senate to expedite the approval of a bill enforcing in the country all international rules on the accountability of ship owners for oil spill damage, and ensuring instant and adequate compensation for parties that suffer losses as a result of the discharge.
The House passed the bill on final reading in November 2005, and sent the measure to the Senate the same month. It has since been pending Senate action.
Under House Bill 4363 -- the proposed Oil Pollution Compensation Act -- owners of ships that "cause pollution damage or create a grave and imminent threat of causing such damage," would be held strictly liable for:
Expenses actually incurred in cleanup operations at sea or on shore; Costs incurred for preventive measures and further loss or damage caused by preventive measures;
Consequential loss or loss of earnings suffered by owners or users of property contaminated or damaged as a direct result of an incident; Pure economic loss or loss of earnings sustained by persons although the property contaminated or damaged as a direct result of an incident does not belong to them;
Damage to human health or loss of life as a direct result of the incident; and Environmental damage and other reasonable measures of restoration. The liability of ship owners is also defined in maximum amounts based on international standards, and depending on the volume of oil discharged and the vessel's gross tonnage.
Despite the Clean Water Act of 2004, which clearly lays down the principle that "polluters must pay," Gullas stressed the need for the enactment of HB 4363 to effectively enforce liability claims and penalties.
Under the bill, entities that haul certain amounts of oil in Philippine waters are obliged to contribute to the IOPC Fund.
The bill also mandates a compulsory insurance system for ship owners to cover potential oil spill damage. Ships carrying over 2,000 tons of oil without valid financial security would be banned from Philippine waters.
