MOEX Offshore 2007 LLC Settlement

(Washington, DC - February 17, 2012) MOEX Offshore 2007 LLC has agreed to settle its liability in the Deepwater Horizon oil spill in a settlement with the United States valued at $90 million, announced the Department of Justice, the U.S. Coast Guard and the U.S. Environmental Protection Agency (EPA) today. Approximately $45 million of the $90 million settlement is going directly to the Gulf in the form of penalties or expedited environmental projects.

According to the terms of the settlement, MOEX will pay $70 million in civil penalties to resolve alleged violations of the Clean Water Act resulting from the spill and agreed to spend $20 million to facilitate land acquisition projects in several Gulf states that will preserve and protect in perpetuity habitat and resources important to water quality and other environmental features of the Gulf of Mexico region. At the time of the spill, MOEX was a minority investor in the lease for the Macondo well. It no longer owns any share of the lease.

On this page:

• Overview of Company
• Violations
• Health and Environmental Benefits
• Civil Penalty
• Supplemental Environmental Projects
• Comment Period

Overview of Company

MOEX Offshore 2007 LLC (MOEX Offshore) was a 10% owner of the lease for the Macondo Well at the time of the explosion and sinking of the Deepwater Horizon oil rig into the Gulf of Mexico in April 2010. (For more information on the 2010 Deepwater Horizon oil spill, see EPA Response to BP Spill in the Gulf).  MOEX Offshore is a wholly-owned subsidiary of the MOEX USA Corporation.  Mitsui Oil Exploration Co., Ltd. is the corporate parent of MOEX USA, which in turn is owned by Mitsui & Co., Ltd. of Japan.

Violations

The United States filed a complaint on December 15, 2010 in the U.S. District Court for the Eastern District of Louisiana alleging, among other things, that MOEX Offshore violated Section 311 of the Clean Water Act, 33 U.S.C. § 1321.  The claims alleged against MOEX Offshore are based on discharges of oil into waters of the United States beginning on April 20, 2010 from the Macondo Well and the Deepwater Horizon, the mobile offshore drilling unit lost in the course of the blowout of the Macondo Well.

Health and Environmental Benefits

Oil spills are known to cause both immediate and long-term harm to human health and ecosystems.  Oil prevents oxygen in water and can suffocate wildlife.

Oil emulsions may stick to the gills of fish or coat and destroy algae or other plankton.  Floating oil may reduce water exposure to the circulation of oxygen and, in conjunction with emulsified oil, interfere with photosynthesis. 

Oil slicks can kill birds, contaminate food sources, reduce animal and plant reproduction and contaminate nesting habitats.  Oil spills can cause long-term effects years later even if the oil remains in the environment for a relatively short period of time. Petroleum oils can also undergo oxidation and polymerization reactions and can form tars that persist in the environment for years. 

Civil Penalty

As part of the settlement, MOEX Offshore has agreed to pay a $70 million civil penalty, as follows:

• $45 million to the United States
• $6.75 million to Louisiana
• $5 million each to Alabama, Florida and Mississippi
• $3.25 million to Texas

Supplemental Environmental Project

As part of the settlement, MOEX Offshore will conduct a habitat protection Supplemental Environmental Project (SEP) valued at $20 million.  Pursuant to the SEP, MOEX Offshore will ensure that properties within the States of Louisiana, Texas, Mississippi and Florida are transferred to or acquired by State governmental entities, non-profit groups, land trusts, or other appropriate entities, to protect those properties in perpetuity from development by encumbering them with conservation easements, deed restrictions, covenants, or other institutional controls. 

Comment Period

The proposed settlement, lodged in the U.S. District Court for the Eastern District of Louisiana, is subject to a 30-day comment period and final court approval.  Information on submitting comment is available at the Department of Justice website.