On Friday, China’s State Oceanic Administration reported that an oil spill in June from two wells in Bohai Bay has polluted 4,250 square kilometers—1,650 square miles—of sea, an area six times the size of Singapore. Moreover, another 3,400 square kilometers had been contaminated to a lesser degree, according to the agency.
ConocoPhillips, the Houston-based operator of the wells in the Penglai 19-3 field, says only 1,500 barrels of oil had been released in the incidents and that both leaks have been brought under control. Beijing, as of the 13th of this month, maintained that oil was still coming out of the wells.
Estimates of the coverage of the slick, spreading from China’s largest offshore oil field, have been rapidly growing in recent days. At the moment, reports put its size at 18 times the area polluted by last year’s spill in the port of Dalian, acknowledged as China’s worst oil leakage.
Analysts say that Chinese authorities have regrettably backtracked from their openness exhibited during the Dalian disaster. Yet that spill started with a massive explosion that was impossible to hide. This year, Beijing—characteristically—tried to cover up the June incidents.
According to the South China Morning Post, ConocoPhillips immediately reported the first spill to the State Oceanic Administration on June 4, the day it occurred. Its partner in the Penglai field, China National Offshore Oil Corporation, said nothing to the public until July 1, despite the fact that large numbers of dead fish were washing up on nearby shores. When SOA got around to saying something on July 5, it fibbed. “There is no visible floating oil on the sea and the leak is now under control,” said a spokesman—although one official conceded that oil was still visible.
Unfortunately, Beijing gets no credit for coming clean. The July announcements, after all, were prompted by whistle-blowing reports on Sina Weibo, a Twitter-like service in China, of the leakages. Sources attribute the online postings to employees of CNOOC, as the state oil giant is known. CNOOC denied it had tried to cover up the spills.
At the moment, it’s not clear whether ConocoPhillips actively worked to suppress news of the two spills or whether it is a victim of the attempt by CNOOC and the State Oceanic Administration to keep the matter from public view. But whatever its culpability, the American company is going to take the fall for events that have been made much more controversial, and emotional, by the ill-fated cover up.
CNOOC disclaimed any liability for the damage, and the State Oceanic Administration blames ConocoPhillips. On July 5, the agency imposed the maximum fine on the Houston firm, 200,000 yuan, for the spill.
ConocoPhillips said there were “no reports of impact to wildlife, fishing, or shipping activities.” That’s not how anyone else sees it, however. The oil producer could face compensation claims for as much as three times the immediate economic loss. Many Chinese are taking the BP compensation fund, established after last year’s horrendous spill in the Gulf of Mexico, as the benchmark for ConocoPhillips. Think of its liability running into the billions of yuan.
As a foreign company, ConocoPhillips is “politically defenseless.” “ConocoPhillips will pay,” said Zhao Hongshun, general manager of Qin Island Marine Fisheries, to the South China Morning Post. “They are Americans.”
Qin Island, an aquaculture farm that is the closest to the June spills, has a lot to lose. That firm suffered a loss after a 2008 spill caused by Sinopec, one of the three large state oil companies. Zhou’s Qin Island has yet to see any compensation for that disaster.
In China, only foreigners, whether or not culpable, pay.
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