US lawmakers urge faster timeline for oil tankers

Feb. 3, 2003
All tank vessels operating in US waters must, under the law, have double hulls by Jan. 1, 2015.

Some lawmakers are urging their party leaders to consider new federal laws aimed at speeding up the 2015 deadline to phase out single-hull oil tankers. But industry groups caution it's too soon to be talking about revising existing rules.

"It's appropriate for us to review what needs doing, how we're doing it, and whether there needs to be changes in existing law," said US Sen. John McCain, (R-Ariz.), chairman of the Senate Commerce Committee. He conducted a Jan. 9 hearing on single-hulled tankers to highlight the Prestige accident off Spain, which may have resulted in the loss of some 60,000 tonnes of oil into the Atlantic Ocean.

Congress drastically changed US tanker regulations in 1990, after the 1989 Exxon Valdez spill in Prince William Sound, Alas., that dumped more than 242,000 bbl of crude oil.

The resulting Oil Pollution Act of 1990 established double-hull requirements for newly constructed tanker ships and barges that operate in US waters and established a phase-out schedule for existing tank vessels.

All tank vessels operating in US waters must, under the law, have double hulls by Jan. 1, 2015.

Strong opposition

In testimony before the committee, the International Association of Independent Tanker Owners (Intertanko) urged policymakers, both in the European Union and the US, not to rush forward with new tighter rules.

Association spokesman Dragos Rauta criticized recent EU efforts, saying, "It is obvious that some in the EU are determined to take unilateral action, in clear contradiction of previous statements, in support of multinational international regulation of shipping."

Rauta argued that some EU member states do not agree with this approach and "are advocating a more-conscientious approach that does not risk diluting overall marine safety and environmental protection."

He added that "hasty" European proposals could be expensive for both Europeans and US consumers. He argued that a market with regional regulations means a less flexible and a tighter market: "Such a situation will cause problems for oil companies and traders who wish to fix ships for optional discharge areas."

Intertanko can't specifically predict yet what the extra costs would be. However, Rauta said one "cannot exclude" that the transportation costs to the US could be increased to $2.50/bbl, over the typical $1.50/bbl historical average for long-haul crude.

Nevertheless, the Prestige oil spill has prompted legislators around the world to consider changes aimed at speeding up the ban.

EU transport ministers agreed Dec. 6 to speed up the phase-out, a decision that was endorsed a week later by EU heads of state meeting in Copenhagen.

But the issue has hardly been settled in the EU, where member states disagree over the seaworthiness of single-hull tankers.

While France and Spain each have imposed a unilateral ban on single-hull tankers in their waters, Greece—which now holds the EU's 6-month rotating presidency—has called for cooperation with the International Maritime Organization (IMO), the UN body dealing with sea transport affairs.

IMO Sec. Gen. William O'Neil agreed, warning the EU against ushering in laws that could clash with the UN body's near-global jurisdiction of maritime matters.

"IMO is the appropriate forum to consider and decide on any measures which the EU members may feel are in need of additional regulatory action at the international level," O'Neill said in a recent statement. "Regional or unilateral application to foreign flag ships of national or regional requirements which go beyond the IMO standards would be detrimental to international shipping and should be avoided."

Hearing highlights

O'Neill's remarks foreshadowed concerns expressed at the Senate hearing the following day. While the EU parliament has yet to pass any law that would be binding on all member states, concerns were raised at the Senate hearing that US ports could become the destination of single hull ships banned from Europe.

"We cannot allow our rules to be more permissive, or these vessels will surely trade here," said Robert Cowen, chief operating officer of Overseas Shipholding Group Inc., a New York-based shipping company.

"It is wholly unacceptable to let the United States become the port of last resort," Cowen said at the hearing.

Sen. Ron Wyden (D-Ore.) expressed similar concerns, saying the current system provides incentives for foreign-based companies to use older, less-seaworthy vessels rather than modern, double-hull vessels.

"To me, what's going on is real simple," Wyden said. "You've got these foreign-flagged vessels playing a shell gameUdesigned to try to avoid accountability and hide their ownership interests. Again and again, it seems to me that profits are constantly trumping safety—to the detriment of communities across the country."

Wyden said Congress should consider toughening restrictions on oil tankers even further, particularly on ships registered in other countries.

While no legislation has yet been proposed in the US, Congresswoman Lois Capps (D-Calif.) announced Jan. 7 her aim of introducing a bill to accelerate the replacement of single-hull oil tankers with double-hull vessels.

"Time and again, coastal communities around the world have been ravaged by disastrous oil spills from single-hulled oil tankers," Capps said.

"Requiring all tankers to use double hulls is the surest way to protect against the environmental and economic havoc brought on by these terrible accidents," Capps said.

"My bill would accelerate the 2015 deadline to 2005 and take other important steps to prevent future catastrophes like the Valdez and Prestige," Capps said, adding, "We have the technology to speed up the phase-out."

But Joe Cox, president of the American Chamber of Shipping, disagreed, saying that the US has the shipbuilding capacity to make its fleet all double-hulled before 2010 but probably not by Capp's proposed deadline of 2005.

Cox cautioned that double-hull tankers are not unsinkable and could be as vulnerable to extremely rough weather as the single-hulled Prestige: "Double hull is not a panacea. It does provide some protection, but in a catastrophic situation, it will not be the answer."