OPINION: When it comes to oil spills, let’s not wait for hindsight

A few months after the Deepwater Horizon wellhead blowout killed 11 people and discharged 210 million gallons of oil into the Gulf of Mexico, an eerily similar event unfolded on season 14 of South Park.

Witnessing catastrophe, one character cried out, “Another oil spill could spell devastation for the Gulf!”

Luckily, just as oil was seen pouring into the ocean, Superhero Captain Hindsight flew onto the scene, speedily explaining to onlookers how this all could have been avoided.

“What they should have done is…”

Following Captain Hindsight’s lecture, the concerned crowd exclaimed, “My God, he’s right!”

Captain Hindsight flew away, and the crowd seemed satisfied; although no harm was actually avoided, they now knew it could have been. The joke on the show points out how much relief hindsight can provide, even when past mistakes aren’t used to fuel meaningful change.

Thirty-four years ago, Alaska learned a dangerous lesson about single-hulled oil tankers, industry oversight, ecological fragility, and our capacity limitations to clean up oil. Dig a hole on a beach in Prince William Sound, and you can still find a black layer of tar today. The city of Valdez wants to make sure those lessons don’t just serve as a cathartic bit of hindsight but as preventative motivation to stop the next disaster before it happens. In 2020, Hillcorp, a Texas-based privately held oil company, purchased BP’s stake in the Trans-Alaska Pipeline System. Unlike previous pipeline operators, they were not required to publicly disclose company financial records in the deal. Valdez recently argued before the Alaska Supreme Court that they should. Valdez wants to ensure the company can adequately maintain its oil infrastructure and clean up any potential spills. The court will issue a decision later this year.

This case largely hinges on a procedural question of legal standing. Hilcorp and the Regulatory Commission of Alaska claim Valdez didn’t log the right piece of paper to make their request and doesn’t have standing because no harm has yet occurred under their watch. In other words, Hilcorp says Valdez should have to wait for another accident before they can ask for accountability concerning a publicly regulated facility in their backyard. Just to be clear, the city is not trying to overturn the BP-Hilcorp deal. They are merely asking that Hilcorp demonstrate the ability to keep their community and environment safe — 440,000 barrels of oil pass through the pipeline every day, hindsight makes clear this poses an imminent risk should Hilcorp not have the finances to appropriately maintain critical infrastructure or manage future accidents.

Allowing private companies to avoid public scrutiny of critical infrastructure is yet another example of special treatment given to the oil industry in Alaska. Our state collects no corporate tax from privately held oil companies like Hilcorp, offers all oil companies a significant per-barrel tax credit, and continues to spend millions of dollars in state money on oil prospects, despite production declines. If we want to attract the oil industry for the payday, why are we giving them back so much of the money oil brings in? Proponents of course point out the historical economic dependency on oil and the risk to State revenue should Alaska fail to keep the industry invested.

Simply put, this costs all of us money. Reforming the oil production tax to reduce tax credits and require private companies like Hilcorp to pay the 9.4% corporate tax that public companies pay would bring in $1.3 billion next year (S.B. 114 makes such a proposal). A lack of public financial accountability only exacerbates the issue — if oil companies can’t afford to clean up the next spill, who do you think is going to foot the bill?

Politicians frequently wag their finger at this type of argument, extolling that unless the state bends over backwards, oil companies will leave.

No, they won’t. Hilcorp spent $5.6 billion just three years ago to be here; they don’t need exemptions or tax breaks or financial secrecy to want to recoup that investment. If we are selling a resource, let’s stop bending market rules for external profits.

This further costs Alaska money by perpetuating dependency on a declining industry, treating our state like a resource colony. Special treatment props up a monolithic economy with outside companies shipping off too much of the benefits while communities like Valdez take on too much of the risk. One day the oil will run dry. We can only get to a sustainable future if we ensure safety for Alaskans and our environment first, stop excess profits from being exported outside second, and support an even playing field for alternative industries third.

When TAPS rusts into obsolescence, the next oil spill devastates our environment or the latest wave of fast and cheap development tumbleweeds out of use, I am sure Captain Hindsight would be happy to tell us how it all could have been avoided. Or we can hold industry accountable today.

I for one am grateful to the City of Valdez for trying to do just that. A little transparency can go a long way. I hope their efforts can help secure the future well-being of our environment and Alaska communities.

Alexander Lee is an Associate Professor of Philosophy at Alaska Pacific University.

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