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Sen. Murkowski Unveils Legislation Authorizing President to Set Oil Spill Liability and Expedite Compensation to Gulf Residents


WASHINGTON, D.C. - U.S. Sen. Lisa Murkowski, R-Alaska, today proposed legislation to address a number of concerns raised by the ongoing oil spill in the Gulf of Mexico, including a provision to expedite payments to those most impacted by the spill.

The bill would authorize the president to set liability on offshore oil and gas projects on a case-by-case basis at time of lease using a set of criteria, including a company's safety record and the depth and pressure of the reserve being developed. Responsibility for claims in excess of an individual cap would be shared by all offshore operators in U.S. waters.

"There are areas where we know the risks of drilling for oil are higher and it's appropriate that operators in those areas have higher liability limits," Murkowski said. "My goal with this legislation is to ensure that we set an appropriate level of liability to protect our oceans and coastlines without damaging our ability to produce the resources our economy depends on."

To speed payment to those affected by the oil spill, Murkowski's bill would establish an administrative process - with an administrator named by the president and confirmed by the Senate - to approve compensation claims without requiring a prolonged court battle. It would also limit attorney fees related to the Gulf spill to 5 percent of compensation.

"There is real concern out there about the prompt payment of claims," Murkowski said. "People are looking for a level of assurance that they will be made whole. An independent administrator assures Gulf residents they're not up against Big Oil all alone."

The bill would also increase the Oil Spill Liability Trust Fund to $10 billion by raising the fee paid by the oil industry to 21-cents for each barrel of oil produced in or imported to the united States. Increasing the total amount in the fund, which currently has a balance of $1.6 billion, would ensure funding is available to respond in case of future spills.

Under the bill, the U.S. Coast Guard would receive a substantial increase in research and development funding and authority to bring oil spill response technology into the 21st century.

The bill restrict oil transportation in Arctic waters to pipelines rather than tankers to reduce the potential for spills.

The legislation also acknowledges the clear and present risks and impacts to coastal states which elect to participate in oil and gas development off of their shores by directing 37.5 percent of the federal revenues to states and affected communities.

"States that host offshore drilling bear a greater share of the risks and therefore deserve a fair share of the economic benefits," Murkowski said.

Murkowski, the ranking member of the Senate Energy and Natural Resources Committee, is crafting the legislation with input from Gulf-state senators and groups such as Oxfam, working on behalf of oil-spill victims,.

"The oil spill in the Gulf is a very emotional issue for all of us," Murkowski said. "I want to make sure we enact legislation based on good, sound policy that will benefit the residents of the Gulf and not simply try to score political points based on partisanship."

Murkowski said she plans to add language, before introducing the bill later this week, that would create regional advisory councils for the Gulf of Mexico region modeled after a system put in place in Alaska after the Exxon Valdez spill.

Murkowski urged the Senate leadership to take up the Oil Spill Compensation Act of 2010 quickly and not try to combine it with broader energy and climate legislation.

"If these measures get mired in the debate over cap-and-trade, then I'm afraid we'll have failed the people of the Gulf in their time of greatest need," Murkowski said. "The efforts we've seen so far to push cap-and-trade legislation on the backs of the victims of the Gulf spill have been unconscionable."

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