Exxon asked to pay more to clean spill

WASHINGTON (CNN) -- ExxonMobil on Thursday was asked to pay another $92 million to further clean up shorelines in Prince William Sound and the Gulf of Alaska, which still contain oil from the 1989 Exxon Valdez oil spill.

The company said it will study the request by the Justice Department and the state of Alaska while calling the department's basis for making it "speculation and hypothesis."

The action was taken under a provision in a $900 million damage settlement in 1991 allowing the government to reopen the agreement in 2006 to consider issues unforeseen at the time.

The Justice Department said the need for an additional project was shown by a series of 2001 studies that document the presence of residual oil from the spill along beaches in the area. The government said in a written statement it had not anticipated the oil would remain toxic and continue to affect the area.

"By sending our plan ... we are aggressively seeking to restore natural resource damages unforeseen at the time of the 1991 settlement," Assistant Attorney General Sue Ellen Wooldridge said.

The Valdez ran aground in 1989 and leaked 11 million gallons of crude oil, polluting more than 1,000 miles of Alaska's shore and killing tens of thousands of birds and marine animals.

In a written statement, ExxonMobil said: "The current request for funding appears to be focused primarily if not exclusively on the hypothesis that remaining weathered oil could be capable of causing biological impacts. That is no more than a hypothesis."

The company said it agrees that "small pockets of sequestered and degraded oil residues" remain in spots on less than two-tenths of 1 percent of the affected shoreline. But it said "there is no scientific evidence that this oil ... could cause damage to any population or species. Speculation and hypothesis do not amount to proof."

ExxonMobil also said the existence of small pockets of residue was expected at the time of the 1991 agreement and noted that about $145 million of the $900 million paid by Exxon to the oil spill trustees is still available.

"If there were any matter in Prince William Sound that needed restoration or repair, it was the trustees' duty to use this money to remedy the problem, and we are confident that they would have done so," the statement said.

Government officials said the leftover money has been earmarked for other restoration projects.

The company added, "Exxon will study this request carefully and respond as appropriate. Nothing we have seen so far, however, indicates that this request for further funding from Exxon is justified."

ExxonMobil recorded a profit of $36.1 billion in 2005, the largest-ever annual amount for a U.S. firm, and former Exxon boss Lee Raymond walked away with a retirement package worth roughly $400 million.

In a conference call, federal and state officials expressed disappointment at ExxonMobil's response, and said they hope to come to an agreement with the company over the next 90 days. If no agreement is reached in that time, a "formal claim" would be filed.

The officials said much of the $750 million that has been spent so far went toward acquiring land, and little was used on "restoration on the land and species."

"We have created an environment where Mother Nature can restore itself," one official said, adding that rather than being "weathered," some of the remaining oil is "as fresh as the day it was spilled."

That was not expected, based on experience with other oil spills, the official said.

"It wasn't until the late '90s we realized that oil was persisting, much more than we would have predicted, because the science just wasn't there," the official said.

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