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Report Says Gulf of Mexico Will Recover Much Faster than Expected after Oil Spill

Source: NY Times/John Schwarz and Mark Schrope

Posted on 02 Feb 2011

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According to new estimates in reports commissioned by Kenneth R. Feinberg, the administrator of the $20 billion compensation fund, the Gulf of Mexico should recover from the environmental damage caused by the enormous BP oil spill last year faster than many people expected.

That prediction will be central to Mr. Feinberg’s plan for paying people who claim their livelihoods were devastated by the spill. It is certain to be controversial among those who believe the damage will be longer-lasting and therefore should result in higher payouts for the spill’s victims.

Mr. Feinberg’s report, to be officially released Wednesday, will lay out for the first time the framework for deciding who gets final settlements for spill-related damage and how payments for future losses will be determined.

Based on the work of environmental scientists, economists and other experts, the report acknowledges that “prediction is not an exact science” but estimates that the gulf should recover by the end of 2012. The hardest-hit oyster beds could take much longer to come back, it says.

Based on those estimates, the damages paid out by the fund would be double the first year’s losses for most of those filing claims, less any money previously paid by the fund. Those whose living is tied to oyster beds would receive four times their 2010 losses.

Mr. Feinberg, appointed in June by BP and the Obama administration, has given out more than $3.5 billion so far in emergency money to those affected by the spill.

But Gulf Coast residents have become increasingly angry over what they say are shortcomings of the program, including inconsistent payments and an opaque process. The methodology for final settlements is meant to answer those criticisms.

Mr. Feinberg has also been criticized by plaintiffs’ lawyers who have filed complaints with the judge in New Orleans who is overseeing federal spill litigation. They have accused the administrator of not being truly independent from BP, and asked the judge to exercise authority over the compensation process.

On Tuesday, the governor and attorney general of Louisiana and the attorney general of Mississippi filed similar requests with the judge, Carl J. Barbier.

A key document used to formulate plans for commercial fishermen making claims was a report by Wes Tunnell, a marine biologist at Texas A&M’s Harte Research Institute in Corpus Christi, who has extensive experience studying oil spills.

The 39-page report acknowledges that any definitive assessment at this point is impossible, and that fully understanding the spill’s ecological effects will take years.