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How the Biggest, Most Expensive Oil Spill in History Changed Nothing at All

Why the Deepwater Horizon spill failed to inspire reform.

A hulking rig is engulfed in flame. It's sinking, spitting out a giant plume of smoke in the process. A firing squad of rescue ships are dousing it with ocean spray. Eleven men are already dead.

Even today, the Coast Guard's photos of the BP spill—you know the ones—look like they were snapped on the set of a Michael Bay film. The scene, then and now the de facto visual signifier for the catastrophe, had one thing working in BP's favor, at least: It looks isolated, set on a backdrop of a vast, expanse of ocean. The action movie mise en scéne leaves the viewer at home feeling detached, like the whole thing is unfolding a million miles away.

Detachment plays a key part in how it came to be that the biggest oil spill in US history, despite incurring the largest environmental fine on the books—$18.7 billion, handed down last weekhas done almost nothing to change the nation's relationship to oil. Five years after the spill, and, by BP's count, $54 billion in projected total expenses, there have been no serious legislative efforts to improve the oversight or regulation of the United States' still-expanding offshore oil operations. Public opinion of deepwater drilling barely budged during the ordeal; today, a majority of Americans favor doing even more of it.

Call it the BP spill paradox: massive in size and cost, all but invisible in its impact beyond the Gulf. It ruined lives, destroyed ecosystems, and cost a fortune, but no new laws were enacted to prevent the same thing from happening again. The White House recently approved further offshore oil exploration in waters far more treacherous than the Gulf. As you read this, Shell's drill ships are heading to the Arctic, despite the fact that its 2012 trial run in was an accident-riddled disaster. Offshore drilling remains just as risky as before the Deepwater Horizon blew, even at ground zero.

The damage was under the surface. For most non-shrimping Americans, the disruption was both literally and figuratively far away

"The BP spill should have inspired Congress and the Obama administration to more rapidly enact the strictest offshore drilling regulations in the world, and to freeze new exploration until new technologies came online," Stuart Smith, a New Orleans-based environmental lawyer recently wrote in an op-ed for the LA Times. "Instead, five years later, the Gulf of Mexico is as vulnerable to accident as ever."

So why isn't the public more interested in protecting it? Why has so little changed?

After covering the spill in its early stages, reporting on its fallout over the years, and conducting a series of interviews with legal experts who've followed it closely, I've managed at least three responses that, together, may help answer that question. First, the BP spill never resonated as deeply or emotionally with the public as did other major oil disasters, and there was less nationwide outrage and subsequent civic engagement. More importantly, and most influentially, a gridlocked, pro-drilling Congress is largely unwilling to consider any serious environmental reforms. Finally, there's the notion that those massive financial penalties will be deterrent enough—though there's a lot of disagreement over whether even some of the biggest fines ever levied against a corporation are enough to stop the oil industry from playing fast and loose with our offshore environs again.

***

In 1969, an oil rig blew out off the coast of Santa Barbara, releasing 3 million gallons of oil onto the coast. That event (combined with the percolating anger at the widespread use of the pesticide DDT documented by Rachel Carson in Silent Spring and the severely polluted Cuyahoga river catching fire, again) prompted the birth of the modern environmental movement. Millions took to the street in outrage, the first Earth Day was christened, and the Republican president Richard Nixon was moved to enact the Clean Air and Clean Water Acts, two of the most powerful environmental laws ever put to the books, and to launch the Environmental Protection Agency.

in 1989, the Exxon Valdez oil tanker crashed on the rocky shores of Alaska. The highest estimates of the subsequent spill placed the amount of escaped oil at 32 million gallons. It spurred a host of reforms, including the passage of the Oil Pollution Act of 1990, which made oil companies the responsible parties in the event of a spill, and mandated that they have a detailed containment plan on hand, as well as cover all cleanup costs—up to $75 million in liabilities.

By way of comparison, the BP spill loosed 5 million barrels—over 205 million gallons, more than six times both of the nation's last major spills combined—of oil into the Gulf of Mexico. And besides a few hearings and a short-lived effort to raise the liability cap that promptly died in the Senate, Congress's response was muted.

"After Exxon Valdez, we passed sweeping legislation—better oversight, using better science, stricter penalties. There was a pretty robust response to the tanker spill in Alaska," Rick Steiner, oil expert and former University of Alaska professor, tells me. "We didn't have anything near that, with a much larger spill in the Gulf. What disturbs me is that because there was no response, we've slipped backwards—the industry has become even stronger in Washington."

Steiner's not the only one who's frustrated. While the Obama administration may have reshuffled the regulatory commissions in charge of overseeing offshore drilling—the corrupt Minerals Management Service was dissolved and split into separate agencies—the attorneys and oil experts I spoke to were hard pressed to think of a single significant law passed over the last five years that would help prevent another deepwater blowout.

A "shockingly large" amount of oil fell to the seafloor—an area the size of the state of Connecticut, congealing together into massive "tar mats" that weigh up to 25,000 pounds

"Congress has done bupkis," says David Pettit, an environmental attorney with the Natural Resource Defense Council. "I think there's still a lot of vulnerability. There will be another oil spill, that's inevitable." And yet no laws have been made or changed to reflect the new realities of offshore drilling. The reason BP was exploring such deep waters in the first place is that heavy demand for oil, and its lack of availability in conventional, easy-to-extract locations, had forced the oil companies to drill in increasingly risky places.

That, of course, is why Shell is headed to Alaska, again risking serious financial and public relations disaster to explore for oil in the frigid, unforgiving Chukchi Sea.

"A spill would be catastrophic," Steiner says. "The worst-case discharge is two million barrels over 60 days. If anything like that were to come out, it's game over for the Chukchi Sea ecosystem, which is already on the edge from climate change."

Catastrophic is right. But we're still underestimating how deeply destructive offshore oil disasters can be.

***

I was on the far southern tip of Louisiana, in the bayou beach town of Venice (nickname: "the end of the world"), when BP's oil first started washing ashore. Along with a German TV crew, a couple Greenpeace activists, and Steiner—we first met aboard a sloshing outboard in search of errant oil—I took a motorboat out to the barrier islands, where we waded through reedy marshland, our eyes plastered on the ground. Soon enough, we found—well, something.

It hit most of us early on that the spill was going to have what the pundits would call an "optics" problem: The crude wasn't going to drench the coastline in thick striking black like it did in when the Exxon Valdez crashed off the Alaskan shoreline, and it wasn't going to viscerally intrude on a clearly pristine environ, as it did in the Arctic.

"Ordinary people were more affected emotionally by what happened in Alaska," Pettit says. "The birds, the mammals, guys trying to steam-clean oil off the rocks. In the Gulf there wasn't so much of that."

The BP oil was brown, diluted, meted out in small clumps. On its journey to the shore, it had coalesced with decades' worth of other maritime pollutants that had slowly leached out from who knows how many other extraction operations and outboard motors and waste streams, then lurched ashore in the form of tarballs. Its virtual invisibility was partly due to the fact that the oil was immediately blasted with a chemical dispersant called Corexit, later deemed to be toxic, upon gushing out of the ruptured Macondo wellhead 5,000 feet below the surface.

One of the reasons BP used so much Corexit—1.8 billion gallons in all—was that it literally seemed to make its problem disappear; who could get outraged at a massive oil disaster if there wasn't much oil in sight? It seemed a conscious choice from BP, which, from the beginning, worked to goad the public into underestimating the extent of the spill, coaxing perception to align with the imagery available. (Along with the Coast Guard battle scene, there were the NASA satellite photos of the greying curl and the plumage of the underwater spill cam; again, the net effect was to render the disaster even more alien; big, but somehow remote.)

Just days after the Deepwater Horizon exploded on April 20th, 2010, BP claimed that the flow rate was a seemingly manageable loss of 5,000 barrels of oil per day (the company would later face criminal charges for lying about that rate; it turned out that BP knew the oil was flowing out up to 10 times as fast from the beginning; the Macondo was spewing 52-65,000 barrels per day, and perhaps even more). But at the time, swaths of the media bought the line. The New York Times told its readers to relax: "the Deepwater Horizon blowout is not unprecedented, nor is it yet among the worst oil accidents in history."

The accident turned out to be entirely unprecedented in many ways, of course—a few months later, the Times would write that the "BP spill is by far the world's largest accidental release of oil into marine waters, according to the most precise estimates yet of the well's flow rate." It eclipsed the Ixtoc-I disaster, an offshore well that blew in 1979 and leaked for nine months before it could be contained. History's only bigger oil disaster occurred when a tyrannical dictator had his retreating army intentionally ignite hundreds of oil wells in Kuwait.

The attitude that oil spills are to be treated as rare, unavoidable events has thus been institutionalized into our political culture, it seems

Unlike the Valdez, I noted at the time, the worst impacts of the Gulf spill were hard to see with the naked eye. It was true then, and it's true now. There were, eventually, a few photo spreads of oiled pelicans, but the 5 million barrels of oil that would eventually escape from the deepwater well mostly stayed out of sight. The damage was done under the surface; to deep water ecosystems, to coastal economies dependent on seafood and tourism. For most non-shrimping Americans who weren't well versed in the breeding cycle of endangered Bluefin Tuna (which were put seriously at risk by the spill), the disruption was both literally and figuratively far away.

Here's what we mostly didn't see, in terms of environmental damage done to the Gulf, as tallied by an exhaustive 2015 NRDC study on the impacts on marine and coastal life: One thousand sea turtles, many of them endangered, died off in the wake of the spill. Hundreds of dolphins died too, probably from inhaling oil fumes. In total, up to to 5,000 marine mammals perished in the putrid, Gulf-wide petrol bath.

Over 1,100 miles of Gulf coastline were contaminated, as were 68,000 square miles of surface water. A "shockingly large" amount of oil fell to the seafloor, scientists say, where much of it remains today—1,200 square miles worth, an area the size of the state of Connecticut, and as much as two million gallons of oil. There's so much oil on the seafloor that it congeals together into massive "tar mats," some of which are so large they weigh 25,000 pounds.

Image: Louisiana GOHSEP/Wikipedia

An estimated one million birds died as a result of the spill, according to the Audubon Society. Seaweed habitats in the region, home to crabs, lobster, and shrimp, saw a massive die-off: In total, their biodiversity was reduced by an estimated 85 percent. Some 12 percent of all bluefin tuna larva were contaminated during its 2010 spawning cycle, with an unknown impact on the great population of the highly endangered fish. Meanwhile, other fish caught in the aftermath of the spill were found to be suffering from lesions likely caused by exposure to the oil. And three major, hundred-year-old deep sea coral communities were found to be "extensively damaged" by the spill.

Then, of course, there's the human toll; the economic damage. In the early days of the spill, I spoke with fishermen put out of work, resort owners who fretted that the spill was scaring off vacationers, and restaurateurs who couldn't sell the regional specialties. Of course, it only got worse as the spill and its fallout unfolded. Economists estimate that, through 2013, the Gulf coast lost $22.7 billion in tourism revenues. The total toll to the commercial fishing industry, through 2020, is expected to be $8.7 billion, and up to 20,000 lost jobs.

Worse, many oil cleanup workers, some of whom were not initially properly equipped with safety gear by BP, began to suffer a peculiar spate of health issues in the days following the blowout. It turned out that Corexit, the chemical BP had used in massive quantities in an effort to break up and disperse the oil, was also breaking up the lung tissue of the humans and mammals exposed to it.

A study from University of Alabama at Birmingham scientists found that the dispersant attacked the epithelial cells found in lungs, and may have sickened hundreds, even thousands of cleanup workers who breathed in the agent. Over the last five years, a number of those workers have complained of respiratory illness and other health woes.

All told, BP's response was disjointed and unprepared. It was the first time that the oil industry had to deal with an accident at a well that deep, as then-CEO Tony Hayward himself said in one of the memorably haphazard press conferences held in the disaster's wake. "There's lot of real-time learning going on," he said, as BP scrambled to cope with a spill that was literally out of its depth.

Thanks in part to its lies and omissions, in 2012, BP was forced to pay $4.5 billion to settle a criminal lawsuit for its "gross negligence" while operating the Deepwater Horizon oil rig. At the time, it was the largest criminal settlement in US history—it was eclipsed only by the $13 billion JP Morgan Chase agreed to shell out for its role in collapsing the global economy.

Image: Patrick Kelley/Wikipedia

Throughout it all, Congress yawned.

"There just seems to have been no interest in Congress in doing anything about this," David Pettit tells me.

In 2010, both houses of Congress were held by the Democrats, and it was just the dawning of the era of sustained gridlock that would marked American politics for the next five years. Republicans were already leaning heavily on the filibuster, which they used to shoot down, before it was even marked up, the first and perhaps only major bill Democrats advanced in response to the Gulf spill—a law that would have expanded the amount oil companies were liable for in the event of an accident from $75 million to $10 billion. (Under current law, oil companies are only on the hook for the paltry latter sum, unless they are proven to have been "grossly negligent" in the court of law, as BP was.)

But even without the filibuster, Congressional sentiment often skewed pro-drilling, even amongst Democrats. The highest-profile Democrat in the Gulf, Louisiana Senator Mary Landrieu, has actually consistently fought to allow BP to continue to drill in the region. It's also worth remembering that so staunch was Republican support for drilling, even in the face of disaster, that Representative Joe Barton, then the ranking Republican on the House energy committee, actually apologized to BP for its troubles.

"Crazily enough we were able to watch the oil spilling into the water for weeks," Pettit says. "And there was no action from Congress to do anything."

A handful of Democrats lobbied for stricter measures, but their voices were drowned out. The doomed climate bill was still in consideration in Congress, but support was tanking fast; even at the time, few expected any kind of significant reform to emerge from the disaster. Congress was already divided, and Republicans were already exhibiting their anti-environmental regulation streak that has continued into the present.

"Let's put it this way: tell me another major legislative reform that has passed Congress in the last five years," David Logan, a professor of law at the Roger Williams University, and an attorney who's closely followed the BP spill case, told me. "You're not going to get major reforms in environmental laws with this Congress. What you might see is a loosening of environmental laws."

Indeed, it's telling that the lone bill Congress managed to pass in response to the spill was the Restore Act, which allocates 80 percent of the Clean Water Act fines BP is forced to pay into a fund that redirects the money to the Gulf states. It introduced no new penalties, regulations, or preventative measures. Congress has thus far failed to pass the laws recommended by federal Oil Spill Commision, that would enforce stricter offshore drilling safety standards.

As Stuart Smith notes, "Congress has also failed to make money available for an oil-spill research fund. A proposed 'safety institute' hasn't materialized. Neither has the new training center for federal regulators, meant to help them carry out more rigorous inspections of offshore rigs." Pettit is right; Congress has done bupkis.

"Some efforts were made to move the boxes around on the regulatory side," Logan says. "But we didn't see anything in terms of amending the Clean Water Act, and it's not that there isn't a basis for legislative tweaks, it's because we have a Congress that isn't inclined to legislate more, and is in fact inclined to legislate less."

Whereas momentous events have spurred reform in the past, Logan said, "that's not this era, and this wasn't such an event. There wasn't much of constituency for change on the legislative front."

But it isn't just Congress.

"At an administrative level, there were some positive steps," Pettit said, like the strengthening of the bodies that oversee offshore drilling, "but the folks in the Department of the Interior and in other departments were just not interested in doing an environmental review." The Obama administration imposed a temporary moratorium on offshore drilling, but it was lifted the same year it was instated.

From the beginning of their investigation, he says, the federal government adopted a blinkered attitude towards the disaster. "In the wake of the BP spill, when the feds were doing their environmental review, they'd pretend like nothing had happened. They'd say it was very rare, an almost unforeseeable potentiality." The NRDC thought the attitude was crazy. "Did they not see what had just happened?" Pettit said. "We brought it to court and lost, every time."

The attitude that oil spills are to be treated as rare, unavoidable events has thus been institutionalized into our political culture, it seems.

"There are no new legislative tools," Pettit says, as Shell heads north. "The kind of penalties we saw in the Gulf, that's it. There's nothing new you'd see if there was a spill in the Arctic."

***

Except for the looming prospect of a massive fine putting your outfit dozens of billions of dollars in the red.

"I think the amount the money BP has had to pay is commensurate with the amount of damage it's done," Steiner says. Whether it's enough, he says, depends on two things: If it's able to amply fund a proper restoration program, and whether it will effectively deter oil companies from taking the kind of risk that result in deepwater spills.

"Is that $50 or 60 billion price tag for BP—is that enough to deter negligent behavior? It sure as hell should be."

Logan concurs.

"Social psychologists call it an 'anchor'," he says. "Say you and I are having a conversation, and we're trying to put a value on something, and I can say, well, someone paid X for it, and that's very different when that number is worse than we've seen before." Like, for instance, an $18 billion fine.

"It has a lot of 0s after the number. That is the kind of message corporate America understands," he says. "It's what lawyers call a general deterrent effect, that extra layers of care are more likely to be applied than before."

"It's a big chunk of change, there's no question about that," Steiner says. "Whether it's enough, you'd have to ask the people down there," who are still living with the aftermath in the Gulf.

There are, of course, criticisms of the BP settlement, as massive and record-setting as it is. For one, some tax scholars are pointing out that unless the ruling attorney specifies otherwise, BP may be able to write off the penalty as an expense—and shift the bulk of the burden directly onto the taxpayers it's supposed to be compensating.

Beyond that, the payment structure is actually considered lenient. As the New York Times explains, "With this deal, BP gets valuable certainty, especially as it does not include any clause that could reopen litigation. The extended payment schedule also allows it to absorb the pain in manageable doses."

BP will be allowed to pay off the $18 billion in yearly installments, which is partly why the oil giant's stock actually rose when news of the settlement broke.

"I wasn't surprised at the amount," NRDC's David Pettit says. "I was surprised at the length of time they were given to pay. That decreases the dollar value."

The biggest, most expensive oil accident in history has passed with a whimper—those explosion-addled scenes of tragedy remain stuck in limbo, b-roll for the occasional news update

Pettit takes another issue with the settlement—that it was constructed in private, and there's no breakdown of how the natural resource allotments were awarded. There's no real sense of why the fines have been awarded, and where they're being allocated to—and that those impacted will therefore have little say over whether the breakdown is ultimately fair.

"It was done in a settlement room," Pettit says. "You weren't there. No one besides the party knows how that number was reached, and it's supposed to be public. So locals can have opinions on how to fix them. Now they may not ever get the chance."

"People call me up and ask about the settlement, and ask me what's in it, and I say, 'I don't know!'" he says.

And the big question is whether the fine really will deter future drilling. Shell's in the Arctic right now, after all, looking to expand its offshore drilling empire.

"I think Shell feels they're big enough," Steiner says, "that they have sufficient size and capital to cover the financial cost of a disaster."

"They're still rolling the dice," he adds. "And they know it. The smaller companies are getting squeezed out because they could not survive the financial hit of a blowout." The majors can—Exxon's quarterly profits, for example, were as high as $8 billion last year. BP's quarterly profits now range from $2-3 billion. Shell's first quarterly earnings of 2015 were $4.8 billion. Oil companies are now among the largest, most profitable corporations on the planet—as crazy it as it sounds, they are arguably able to fold a billion or two dollars a year into their operating costs.

Logan, who notes that "it would be reckless to be overly punitive," also concedes that it's up in the air whether or not the fine is large enough to help prevent another offshore blowout.

"You may be right that this number wasn't big enough to change behavior," he says when I ask him if the amount is high enough, "but it provides context and signals." Offshore drilling, he says, "is not a venture for thinly capitalized companies. On balance, my takeaway is that BP got whacked with a number of big sticks and the companies that ignore that are engaging in reckless dangerous behavior."

Pettit thinks that's exactly what Shell is doing, that the industry is still marked by the same hubris BP exhibited before the spill.

"These folks are top-grade engineers who have faith in their abilities," he says. "They think, 'It won't happen to us.'"

***

But it will, inevitably. Shell has already discovered a breach in the hull of one of its drilling vessels, just days into its latest Arctic expedition. Deepwater oil extraction is a marvel of modern engineering, extraordinarily complicated, and difficult to do safely even in placid waters. There are thousands of offshore oil rigs in the Gulf of Mexico, and a great many more around the world—drilling is common off the shores of Brazil, Russia, and Norway and elsewhere. And it's slated to grow.

The offshore drilling rig market is expected to grow from a $66 billion industry today to a $102 billion sector over the next four years, according to a market research report from Markets & Markets. The US is still speeding towards a 45-year production high, even as the global price of oil remains low. Much of that output has been fed by the rise of fracking and oil shale extraction, but as the price of oil regains composure, expect to see more energy companies push for more offshore drilling. Everyone in the industry is watching Shell—if the company manages to succeed in the Arctic, even temporarily, expect others to follow, risk of another colossal spill firmly in tow.

"The long and short of it is, the government-industry hierarchy is willing to take the risk," Steiner says. "And they're not the ones who are going to be suffering the consequences of a failure."

But without any new laws, there's little assurance that said hierarchy is doing everything it can to prevent another disaster. Most of the experts I spoke with thought at the very least, the $75 million liability cap should be expanded (one called it "ridiculously small") to penalize oil companies that spill even when they're not ruled to have acted in "gross negligence." Offshore drilling standards could be strengthened and standardized. Other proposals, like Stuart Smith's, are more aggressive; ban deepwater drilling until the technology is fully proven to be up for the task. The surging Democratic presidential candidate Bernie Sanders, meanwhile, would end offshore drilling, period.

None of those ideas are even on the table. Instead, the biggest, most expensive oil accident in history has passed with a whimper—those explosion-addled scenes of tragedy remain stuck in limbo, b-roll for the occasional news update. Congress, oil companies, and the public remain, generally, detached from the reality of the enormous toll the spill has taken in the Gulf. And without any new laws that might protect our shores from another spill.

"If it doesn't happen in a the wake of a tragedy," Logan says, "it's not going to happen five years later."