Linkages between Oil Spill Removal Activities and Natural Resource Damages
ABSTRACT The new Oil Pollution Act of 1990 defines natural resource damages from oil spills as the sum of the cost to restore foregone natural resource services, the diminution of value of natural resource services prior to restoration, and damage assessment costs. Natural resource damages are usually determined once removal activities (containment, protection, and cleanup) are completed. Nevertheless, removal activities affect the magnitude of all three natural resource damage components. Consequently, to minimize the total cost of oil spills, decisions on removal activities should consider the linkages between removal activities and natural resource damages. Successful containment results in minimal natural resource damages, because oil generally does far less damage to natural resources in open water than on shore. If oil cannot be contained, the potential natural resource damages from oil coming ashore in certain areas can help determine priorities for protection activities. In particular, oil may harm natural resource services much more in some areas than in others. Furthermore, some natural resource services are more costly to restore and assess than others. Finally, some cleanup activities do more harm than good to natural resource services. If the effects of cleanup activities on natural resource damages are ignored, “excessive” cleanup activities are likely.