Exxon’s Fine For Massive Tar Sands Spill Is A Mere 1/3000th Of Its Third-Quarter Profits

http://thinkprogress.org/climate/2013/11/08/2914881/exxon-pipeline-spill-fine/

By Kiley Kroh on November 8, 2013

Federal pipeline safety regulators announced on Thursday that they are proposing a $2.6 million fine against ExxonMobil after a ruptured pipeline spilled thousands of barrels of oil in Mayflower, Arkansas this past March.

Pipeline and Hazardous Materials Safety Administration said in a letter to Exxon that the company had violated pipeline safety regulations and failed to notify the agency that the pipe, built before 1970, was susceptible to rupture.

“The really disconcerting thing about the violations listed is how they fly in the face of what the industry keeps saying about their efforts to make pipelines safe through their integrity management plans,” said Carl Weimer, Executive Director of the watchdog group Pipeline Safety Trust, via email. “This type of ERW pipe has been known for years to have serious problems and this Notice of Violation makes it clear that Exxon did not recognize the risk or prioritize their testing program correctly to protect people or the environment.”

The fine is a drop in the bucket for Exxon, which earned $7.8 billion in the third quarter of 2013 alone, and whose profits through September top $24 billion.

The spill has taken a tremendous toll on the people of Mayflower and cleanup is far from complete. The ruptured pipeline gushed 210,000 gallons of heavy Canadian crude into a residential street and forced the evacuation of 22 homes. In July, Exxon told homeowners it was ending temporary housing payments before residents felt it was safe to move back.

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In addition, PHMSA’s hands are tied by a cap, set by Congress, on the size of penalties it can administer. Earlier this year, Jeffrey Weise, who heads the agency’s Office of Pipeline Safety, spoke candidly about his agency’s difficulty in enforcing regulations. “Do I think I can hurt a major international corporation with a $2 million civil penalty?,” he asked a c

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Weimer said fining a company like Exxon, which routinely accrues tens of billions in profits, just $2.6 million “is like fining a motorist that drives in a manner that recklessly endangers the public $2.50. No one thinks that level of fine for reckless driving would change anyone’s behavior, so why would anyone think $2.6 million would change Exxon’s behavior?”