Private Empire: ExxonMobil and American Power

by Steve Coll

  The Coast Guard’s monitors did not question him. One of the men on duty was on a coffee break. In any event, it was not as if he or anyone else in the Coast Guard could easily track the Exxon Valdez’s movements once it reached the vicinity of Bligh. Budget cuts during the 1980s had left the Vessel Traffic Service without a radar system that could follow ships reliably once they moved thirty or more miles south of Valdez. Even if the Coast Guard had possessed such radar, it might not have mattered; blood tests administered later to the two men on duty showed traces of marijuana and alcohol.6 Regulators and the regulated had fallen into a slothful embrace, reflecting a national political atmosphere that emphasized the benefits of light government oversight. There was intense pressure to reduce costs within the oil industry. A decade of operations around Valdez had passed free of major accidents.

  On the bridge, Hazelwood told Gregory Cousins, his third mate, “Bring it down to abeam of Busby and then cut back to the lanes.”

  Cousins was an experienced sailor who had made the passage through Prince William more than two dozen times, but he was not legally qualified to take control of the ship in these waters.

  “Do you feel comfortable with what we are going to do?” Hazelwood asked him.

  “Yes.”

  “Do you feel good enough that I can go below and get some paperwork out of the way?”

  “I feel quite comfortable.”7

  At 11:50 p.m., Hazelwood left the bridge again for his quarters. Like the drinks he had downed less than four hours before boarding the ship, this decision was a violation of Exxon Shipping Company policy. He said later that he left “because there wasn’t a compelling reason to stay.”8

  What occurred on the bridge in the minutes that followed would never be fully explained. Cousins, helmsman Robert Kagan, and other crew members became confused, attempted to turn the ship as their charts instructed, made technical mistakes, and soon lost track of their position altogether. At last Cousins telephoned Hazelwood: “I think we’re in serious trouble.”9

  A terrible shock and sound engulfed them around ten minutes after midnight. Cousins felt a series of sharp jolts, heard some of the ship’s relief valves open, and smelled oil. The ship’s chief mate, James Kunkel, banged on a crew member’s door to wake him: “Vessel aground. We’re fucked.” Bligh Reef had cut open the ship’s belly across its length. Oil pools surfaced on the dark sea.

  Hazelwood raced upstairs. He saw two officers peering overboard at the gushing oil, its roiling blackness illuminated by a spotlight. He retreated to a toilet and vomited. He found that he had trouble catching his breath; he felt that he had “been hit in the breadbasket with a ten-pound maul.” He knew that “the world as I’d known it had come to an end.”

  About eighteen minutes after the first sounds of steel on rock echoed through his ship, Hazelwood radioed the Coast Guard. “We’ve—should be on your radar there,” he said. “We fetched up hard aground north of Goose Island off Bligh Reef. Evidently we’re leaking some oil and we’re going to be here for a while.”10

  The watch stander in Valdez telephoned the Coast Guard’s commander, Steve McCall. “I’ve got the Exxon Valdez hard aground Bligh Reef.”

  “Are you serious?”

  “I’m serious as a heart attack.”

  Just over thirty minutes later McCall pulled off the Valdez dock in a fast boat with two other Coast Guard officers, a representative of the state Department of Environmental Conservation, and two local pilots. The night had turned crisp and clear, and when they reached the Exxon Valdez, “you could see oil bubbling out from underneath,” recalled Mark Delozier, one of the Coast Guard officers aboard. As the oil surfaced it “made a gurgling noise and big bloops would leap right out of the water two to four feet. Then it would settle down to the surface.” The slick around the ship was already twelve to eighteen inches thick.

  They boarded and approached Hazelwood. “How did this happen?”

  “You’re looking at it.”

  Delozier stepped back and pulled a colleague into a huddle. “Did you smell what I smelled?”

  “Yeah.”

  “We need to get someone out here to do an alcohol test on the captain as well as the crew.”11

  In the days ahead Hazelwood’s intoxication would simplify perceptions of the accident. It provided Exxon a means to narrow its responsibility. The corporation soon dispatched a telegram to its tanker captain informing him that he had been fired. (Hazelwood later testified that he learned of his dismissal only through media reports.) For late-night comedians the drunk-driving imagery proved irresistible. Hazelwood’s number-one excuse, according to a David Letterman Top Ten list: “I was just trying to scrape some ice off the reef for my margarita.” It did not take long for government investigators to discover, however, that the grounding had been caused by a more complex chain of human error, abetted by inadequate regulations and corporate safety systems.

  When Steve Cowper, the governor of Alaska, arrived on the scene the next afternoon, one of his colleagues told him that Hazelwood “may have been drinking but I’m not sure that had anything to do with it.” A Coast Guard study would soon conclude that the service’s own multiple deficiencies contributed significantly, along with a pattern of expediency within the oil and shipping industries: “The game rules now are for a professional investor to move freely within the marketplace spending as little as is necessary. Today’s adage is to do more with less, make two tankers do the work done by three previously.”

  That had certainly been the adage at Exxon in the years before the wreck. In 1982, the corporation employed 182,000 people. Unexpectedly, oil prices dropped. In response, chief executive Lawrence G. Rawl advanced a slashing campaign begun by his predecessor, Clifton C. Garvin Jr. The campaign eliminated about 80,000 jobs by 1989—more than 40 percent of the workforce in just seven years. At Exxon’s headquarters in a white skyscraper on Sixth Avenue in New York City, employment fell from 1,362 to 330. The corporation’s top environmental officer at headquarters was demoted; his staff was reorganized and absorbed by a research group. The experts in oil spill response that wrote Exxon’s manual for disaster management also lost their jobs. The cuts buoyed Exxon’s financial performance at a time when competitors struggled. In 1987, Exxon reported more annual profit per employee than any other major American corporation.

  The National Transportation Safety Board concluded that third mate Cousins and his shipmates were overworked and that cutbacks of the number of crew assigned to Exxon tankers had compromised the ship’s ability to detect potential hazards. The N.T.S.B. cast blame not only on Exxon Shipping, but also on the state of Alaska, the Coast Guard, and the performance of the individuals aboard, including the captain. Hazelwood’s decision to leave the bridge was a factor in the accident, and his drinking may have contributed to that decision, but the failings that led the Exxon Valdez onto the rocks ran deeper than his own.12

  By Saturday, Exxon executives estimated that 240,000 barrels of crude had poured into Prince William Sound, more than had ever been dumped into American waters at one time. Television camera crews arrived in Valdez by the scores and beamed out images of saturated birds and blackened sea otters. The immediate damage to wildlife caused by a spill arises from direct contact with the oil while it is exposed on the water or the shore. A marine mammal such as an otter will lose vital insulation on the contaminated section of its fur, preen itself for relief, ingest the petroleum, and soon die. Nearly 1,000 sea otter carcasses appeared in Prince William Sound after the spill. Federal scientists never established an exact count of the total dead, but they estimated that about 2,800 sea otters perished. With their furry faces and pleading black eyes the otters became the symbols of a broader wildlife massacre. Scientists later estimated that about 300 harbor seals, 250 bald eagles, 22 killer whales, 250,000 seabirds, and billions of salmon and herring eggs were destroyed by the initial exposure to Exxon Valdez oil.

  On Saturday afternoon, March 25, Don Cornett, Exxon
’s director of its office in Anchorage, a silver-haired veteran of the corporation, telephoned George Nelson, one of his counterparts at the pipeline consortium. Cornett would play a leading role in representing Exxon before the media and the public in the days and years ahead. His past assignments had included a stint as an environmental manager in the corporation’s marine department; he had experience with oil spills. He flew by chartered helicopter to Valdez and hit the telephones. He would later reflect that because of the chaotic flow of information, “it was hard to always make the right calls. . . . The emotions surrounding the damage to the mammals and the birds were totally understandable and totally unmanageable.” That Saturday, because he was calling from an emergency response center, his telephone line was recorded.

  “Are you getting a lot of press contacts into your office?” Nelson asked him.

  “Jesus Christ. I can’t get off the telephone.”

  “I thought you probably were, but many, many hundreds of them—how many of them are down in Valdez? A whole bunch, aren’t there?”

  “‘Yeah, yeah. Well, they’re taking some in Houston, some in New York, and I’m taking some here. . . . They’re getting prank calls.”

  “They’re getting what?”

  “Prank calls.”

  “Like what?”

  “‘You dirty bastard.’ . . . We’re getting those over here too,” Cornett said.

  “Well, this is going to be a public relations nightmare.”

  “Nightmare,” Cornett agreed.

  “Nightmare, to say the least. Yes, to say the very least.”

  “Do you know how I feel?”

  “How?”

  “Do you remember when Patton looked out over the battlefield and said, ‘God help me, I do love it so.’ . . . When they were going to invade Europe, he said, ‘God wouldn’t let this happen and not make me be in on it.’ That’s the way I feel.”13

  Lee R. Raymond, the president of Exxon Corporation and then its number-two executive, heard about the grounding of the Exxon Valdez while on company business in Jacksonville, Florida. Raymond had helped to design the ambitious reorganization plan that had eliminated more than 40 percent of the corporation’s employees in the years before the wreck. He was in Jacksonville because Lawrence Rawl had sent him there to scout real estate. As part of their campaign to remake Exxon, Rawl and Raymond had decided to move the company’s head office out of Manhattan; Jacksonville was a possible destination. As he absorbed the news from Alaska, Raymond said later, he was “chagrined . . . horrified and to an extent devastated.” His wife, Charlene, told him, “It’s the first time I have ever been embarrassed that we work for Exxon.”14

  Raymond was ill with a severe spring cold and could not fly for a few days, on doctor’s orders. Pent up in Jacksonville, restless, he began to assess the cause of the accident and to coordinate Exxon’s response. Raymond had grown up in Watertown, South Dakota. His father was a railroad engineer who drove trains between Watertown and Aberdeen. In high school the younger Raymond decided to study chemistry, particularly its mathematical aspects; he attended the University of Wisconsin as an undergraduate and ultimately earned a doctoral degree in chemical engineering at the University of Minnesota as a National Science Foundation fellow and on other scholarships. He took his first job at Exxon and rose through the ranks. He could mist up when speaking about his father or the people who worked for him at Exxon. Normally, however, he did not come across as a sentimental man and could be a blunt and demanding manager. At the time of the spill he was fifty years old and had worked at Exxon for twenty-five years.

  In time Raymond would draw a number of conclusions about the Exxon Valdez. One of his earliest assessments was that environmentalists and confused politicians in Alaska—particularly Alaska’s governor, Cowper—had prevented Exxon from reducing the effects of the disaster by refusing to allow the company to spray chemical dispersants on the oil slick during the first days, as provided for in a spill response plan previously filed by Exxon with the state. Chemical dispersants do not eliminate oil, but if applied correctly in favorable conditions, they can break up concentrations and drive oil droplets underwater. That can reduce the impact on birds and marine mammals that feed or travel at the surface. Chemically dispersed oil may also be less likely to wash up on beaches in dangerous concentrations. Oil driven beneath the surface might harm fish or other subsurface life, however. Fisheries were the most important source of income and employment in Prince William Sound. Also, several factors can limit the effectiveness of dispersants. The chemicals are less effective in cold waters than in warmer waters. They are typically released by aerial spraying. If the seas below are calm, as they were in Prince William Sound during the first days after the Exxon Valdez gashed itself on Bligh Reef, the chemicals may not churn and mix adequately. If the particular composition of spilled oil or the chemistry of the water is unknown, then the impact of dispersants may also be uncertain.

  Chaos reigned around the decision makers on-site in Valdez on Friday and Saturday. Local fishermen arrived at hastily arranged press conferences at the town’s civic center, shouted questions, made speeches, and threatened to take the cleanup into their own hands. On the stage at the press conferences stood Exxon employees “wearing three-piece suits,” recalled Dennis Kelso, then in charge of Alaska’s Department of Environmental Conservation. Meanwhile, in the crowd, “there was so much fear and anger you could hear it crackling through the audience.”15 Valdez was a small and isolated town; local oil and government representatives struggled to make decisions while consulting with their superiors over long-distance telephone lines. There were multiple sources of overlapping authority: the Coast Guard, the state of Alaska, the pipeline consortium, and Exxon. British Petroleum, the lead owner of the pipeline consortium, Alyeska, was supposed to have ensured that preparations for response to an oil spill in the sound would be adequate, but the consortium had failed to equip tiny Valdez with adequate boats, vehicles, booms, leased aircraft, and other vital materials.

  The Coast Guard had emergency procedures to respond to oil spills and had supervised cleanups in the Gulf of Mexico and elsewhere, but it, too, lacked the equipment to take full charge in Prince William Sound. Exxon lacked the means as well, because it had been relying on the B.P.-led pipeline consortium. Exxon “had more experience,” as a senior Coast Guard officer put it, so the Coast Guard yielded to the corporation. Raymond later said that Exxon in fact had access to “a lot of cleanup equipment on the ground,” but he blamed Alaskan officials for not granting permission to use it. He also deflected any suggestion that his and Rawl’s decision to lay off Exxon’s oil spill specialists during their cost-cutting spree had hindered the corporation’s response: “We have people all over the world trained to handle oil spills, even if they don’t have the exact title of oil spill specialist.”

  Fishermen in Valdez believed that spraying chemical dispersants would do more harm than good to salmon and other fish populations on which they depended. Hundreds of thousands of young salmon were about to be released into the sound at the start of their annual migration—if they swam through toxic oil driven beneath the surface by dispersants, they might be destroyed before they reached maturity. Locals voiced these fears to Steve Cowper and his advisers. Cowper authorized a few tests, which did not turn out promisingly—the chemicals were dumped accidentally onto cleanup crews. Coast Guard officers were not enthusiastic about using dispersants; neither Alaskan state officials nor Environmental Protection Agency specialists recommended going forward aggressively.

  Lee Raymond fumed. Running limited experiments in these circumstances was “like testing the fire hose after the house is on fire,” he thought. He accepted that in cases where the chemistry of oil and water was unknown, a dispersant plan might best be implemented cautiously—but that was not the case here. “There is only one kind of crude on a vessel leaving Valdez,” he said later. He was referring to the fact that only well-known Alaska crude blends came down t
he pipeline and their chemistry had been well studied. “It is one of the most susceptible of all crude oils” to dispersants. “Therefore, that information didn’t need to be established.”

  Early in his Exxon career Raymond had worked at the lab that developed COREXIT, the dispersant available to use in the sound; he felt he knew the issues from the molecular level on up. But Exxon executives on the scene kept telling him that “the state and special interest groups trying to influence the state” were opposed to using Exxon’s previously approved dispersants, and Dennis Kelso, in particular, was “flat opposed.”16 Alaskan officials and federal scientists later concluded that there had been neither enough chemicals nor delivery systems to make a decisive impact in the time available, but Raymond held just as firmly to the opposite view. The deeper this conviction took hold of him, the more it seemed to harden his belief that once the oil began to pour into Prince William Sound, the corporation acted blamelessly, while environmentalists did not.

  “I asked you a moment ago . . . what, if anything, you felt Exxon did wrong, and I think your answer began by saying, well, you didn’t really think it was a matter of right and wrong,” Jim Sherman, a lawyer for the State of Alaska, asked Raymond later at a deposition.

  “Well, I don’t mean to be argumentative, but assigning blame isn’t the same as being right or wrong,” Raymond said.

  “Well, do you think the State of Alaska’s actions in the first seventy-two hours after the spill in regard to dispersant use were wrong?”

  “My own view is that dispersants should have been applied. If you are suggesting that the state didn’t think they should be applied, then I guess we would have a difference of view. And since I’m right, I guess by your supposition you are wrong.”

  “By those same terms, did Exxon do anything in the course of the weeks that followed the spill that was wrong?”

  “The state may have a view on that and I have a different view.”