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Natural Resource Damage Assessment: Methods and Cases

Natural Resource Damage Assessment: Methods and Cases

D. M/V Formosa Six

D. M/V Formosa Six Location: The site is in the Gulf of Mexico, about three miles off the Southwestern pass of the Mississippi River. On April 11, 1997, the M/V Formosa Six, a chemical tanker, collided with the M/V Flora, causing a large chemical release from the M/V Formosa Six into the water. Release: 1,500 to 1,800 metric tons of ethylene dichloride (EDC) were released from the M/V Formosa Six into the Gulf waters. Injury: Because EDC has a much higher specific gravity than sea water, the trustees estimated that most of the EDC sank rapidly to the sea floor below, with minimal exposure to marine animals on the surface or in the water column. Sampling of the sea floor, done in May 1997, revealed that EDC was present in the sea bed at a concentration of greater than 100 parts per million (ppm) over a 12 acre area. The highest concentration found was greater than 26,000 ppm. Approximately 50 acres showed concentrations between one and 100 ppm. EDC biodegrades slowly, and was expected to gradually disperse into the water column. Dispersion occurs more rapidly when the water is turbulent. Hurricane Daniel passed near the area in July of 1997. Based on these facts, the trustees believed that by May 1999, the affected area had recovered completely. Although the accident caused vessel traffic to be rerouted, any effect on commercial or recreational use of the area was negligible. The only significant loss of resources was the effect on services provided by benthic bacteria on the sea floor. Benthic bacteria breaks down organic matter that settles on the sea floor, and they serve as prey for larger organisms, including the commercially important brown shrimp. Concentrations of EDC over 100 ppm occurred over an area of 12 acres, and are estimated to have caused a loss of services from benthic organisms for approximately two years. Attachment of Liability: NRDs are permitted under both CERCLA and CWA because of the “release” or “discharge” of a hazardous substance into the waters of the adjoining shorelines of the United States or into a contiguous zone of the United States. Trustees: • National Oceanic and Atmospheric Administration • Louisiana Department of Wildlife and Fisheries • Louisiana Department of Environmental Quality • Louisiana Department of Natural Resources Potentially Responsible Parties: • Formosa Plastics Tanker Corporation, owner and operator of the M/V Formosa Six at the time of the incident. • EFNAV Co., LTD, manager of the M/V Flora at the time of the incident. • Segesta Shipping Co., LTD, owner of the M/V Flora at the time of the incident. 99

Damages: The U.S. Coast Guard required the responsible parties to arrange for sampling of the sea bed below the site of the collision. This sampling provided the statistics for EDC concentration on the sea floor. It was determined that the acres of benthic bacteria with concentrations higher than 100 ppm would suffer a service loss caused by toxicity to those benthic organisms. The trustees used a compensatory restoration approach to quantifying damages. The trustees found that the creation of intermediate marshland would be the most efficient and otherwise appropriate form of restoration to compensate the public for the loss of ecological services in the affected area from the time of the incident until full recovery. The marsh will contribute organic matter to offshore environments like the 12-acre area where the concentration of EDC was over 100 ppm. The trustees also found that the marsh would provide services to species that also used the damaged area, such as the brown shrimp. Using Habitat Equivalency Analysis, the trustees determined that at least one to two acres of marsh would have to be created to compensate for the loss of the services in the affected area of sea floor. Settlement: The responsible parties agreed to pay $65,000 in compensatory damages and $25,000 to reimburse the trustees for the costs of investigating the incident. The money paid in compensatory damages was applied to a wetland-restoration project that was already being funded with state and matching funds. The project is being carried out under the Wetlands Reserve Program, which is administered by the U.S. Department of Agriculture’s Natural Resource Conservation Service. Through this program, private landowners are given the opportunity to enter into a conservation easement or a cost-share restoration agreement; both options preserve private ownership of the land. This allows marginal farmland to be converted back into valuable wetlands. The original project aimed to remove levees in low lying coastal areas, causing approximately 500 acres of land that had been converted from estuarine marsh to farmland to return to wetland status. The Formosa Six settlement funds will enable an additional 140 acres of land to be converted to marsh. References Formasa Six Spill Agreement. 1999. Kern, John, Brian Julius, John Iliff, Stephanie Fluke, LisaMarie Frietas, Heather Finley, Him Hanifen, Chris Pichler, Linda Pace. 1999. Damage Assessment and Restoration Plan and Environmental Assessment: M/V Formosa Six Ethylene Dichloride Discharge, Gulf of Mexico, Louisiana, April 11, 1997. 100

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