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Settlement Reached on Exxon Oil Spill

EXXON will pay up to $1.1 billion to avoid a criminal trial for America's worst oil spill disaster and plead guilty to four criminal charges, the United States government announced. The agreement, which stems from the Exxon Valdez oil spill in Alaska two years ago, is the largest such settlement for environmental damage in US history.

Although Exxon Corporation and Exxon Shipping Company faced felony criminal charges, they will be allowed to plead guilty to a total of four misdemeanor counts.

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The agreement - signed at the Justice Department in Washington early Wednesday after long, difficult negotiations - faces review by at least two federal judges and will also be scrutinized by Congress and environmental groups.

The deal would settle all federal and state criminal claims from the March, 24, 1989, spill in Prince William Sound. Exxon and Exxon Shipping would pay $900 million in damages, a criminal fine of $100 million, and up to $100 million more for additional environmental damage identified during long-term studies.

Of the total, $135 million is designated for past expenses, including cleanup and scientific research. All of the civil settlement's $750 million will be administered by three state and three federal trustees. Money left after payment of cleanup and scientific bills will be spent to restore Prince William Sound and the Gulf of Alaska, officials said.

The deal does not free Exxon from more than 300 lawsuits filed by Alaska natives, other residents, and various private businesses.

Exxon would make its payments over a 10-year period. Of the $100 million criminal fine, $50 million was earmarked for the State of Alaska to pay for restoration of natural resources.

Environmentalists were generally pleased but concerned about the status of a host of scientific studies that remain secret. Government lawyers say the information will remain sealed pending the outcome of court cases brought against the State of Alaska and the US Coast Guard.

The spill was the biggest man-made natural disaster in US history. More than 36,000 waterfowl died, along with more than 1,000 sea otters and 144 bald eagles.

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Exxon already has spent some $2 billion on the cleanup, and many shorelines are almost free of oil. But others have oil residue.

The settlement included the $100 million ``reopener'' clause because the total damage to wildlife has not been fully calculated. Studies reportedly are documenting long-term damage to some birds and marine life.

The captain of the Exxon Valdez, Joseph Hazelwood, was acquitted of several serious state charges last March but convicted of negligent discharge of oil, was sentenced to perform 1,000 hours of community service and pay $50,000 in partial restitution for oil-spill damage.

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