Pipeline company countersues oil industry watchdog group

Posted: Friday, July 15, 2005

ANCHORAGE - An oil pipeline company has struck back at an industry watchdog group in a dispute over the group's commission of a study on how industry profits could more effectively fund environmental protections.

Alaska Pipeline Service Co. has countersued the Prince William Sound Regional Citizens' Advisory Council and seeks reimbursement of more than $25,000 the council spent to assess oil company profits.

The council, formed after the 1989 Exxon Valdez oil spill, is funded almost entirely by Alyeska, a consortium of BP, ConocoPhillips, Exxon Mobil and other oil companies that runs the 800-mile trans-Alaska pipeline and Valdez tanker port.

Alyeska said the council had no right under its contract to spend the industry's money to assess company profits. Alyeska said it would not have objected had the funding come from elsewhere.

The counterclaim, filed June 29, seeks reimbursement of the $25,000 paid to Richard Fineberg, a Fairbanks analyst and frequent industry critic who headed the study. It also calls for the return of lesser amounts the council paid two economists for reviewing Fineberg's work, plus other expenses related to the report.

Alyeska spokesman Mike Heatwole said the company is more interested in making the council adhere to the contract and that money is not an issue.

"It's more the principle of the matter," he said.

The congressionally mandated nonprofit council had sued Alyeska on May 27 in state Superior Court in Valdez in response to a formal demand by Alyeska that the nonprofit group not use industry funding to study profits.

John Devens, the council's executive director, said earlier this year that the owners of the trans-Alaska oil pipeline had been discussing environmental cutbacks, so the Valdez-based group commissioned a study of their profits.

The analysis showed the oil industry has ample money to spend on maintaining or enhancing environmental safeguards.

"This report indicates the industry can easily afford to do things right in the sound, as we've always maintained," Devens had said in written remarks issued with the report. "Alaskans don't need to worry that asking the industry to protect our environment will drive it out of the state."

Council spokesman Stan Jones said Alyeska's countersuit was expected and the council isn't backing down.

The Prince William Sound Regional Citizens' Advisory Council, which receives $2.8 million annually from Alyeska, monitors the tanker port, conducts independent research and advises on oil spill prevention and response. The council board includes commercial fishermen, local government officials and business people.

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