Talk about murky waters...

So, I tried to find precedent-setting historical events to use as a guideline or model for the Gulf spill, with Exxon Valdez as the primary event because of its huge impact on Alaskan fishing industries... and the fact that the litigation involved is now finally finished, 20+ years after the fact.

This is NOT an easy course to steer, however. The initial punitive damages awarded by the courts for Exxon to pay were determined to be one-years worth of profit... estimated at $5 billion in 1990 dollars, but through an appeals process that took 14 years to complete, the SCOTUS determined that the punitive damages could not exceed the compensatory damages, which stood at $500 million and some change. In an effort to end the litigation process, Exxon settled out-of-court with the famous "Seattle Seven" (the largest seafood producers effected by the spill) which further cut their financial cost down to $63.75 million... and that is a HUGE reduction from the initial $5 billion awarded, and the $500 million that the SCOTUS determined was "justified". I have to assume that this settlement was reached only because of the time lost in the appeals court system... nearly 18 years of litigation before these seven seafood companies saw even a penny in lost revenue compensation.

Exxon averaged $3.9 billion a year in net profits during the entire court process from early in 1990 its completion in 2008.

I'm saying here that I do feel BP is responsible for lost revenue to the Gulf Coast seafood industry. The Exxon Valdez wreck was determined to be an "accident", just as I am assuming the rig explosion will be (keeping to the "angelic" position Jambo took in his initial post), but the Courts determined that Exxon had a responsibility, just as I am sure they will with BP. The fact that the rig was leased won't factor in unless some fact or procedure was omitted from operation, thus moving the culpability to the manufacturer rather than BP (Transocean, I think). As Jambo said, the clean-up is completely and utterly BP's job, in both cost and operation, and any assistance that the Feds might offer via the National Guard or the military will be paid for by BP. I kept the scope of my reading only to the question of lost revenue to the regional industries, and going by the results and determinations of the Exxon Valdez disaster, I'd say that BP will pay, but far less than what is determined to be owed and only after decades of litigation and appeals have passed.

I'm far more curious to see what this disaster does to the "Drill, baby, drill" movement so central to conservative plans for greater domestic energy production. Calls (screams, more likely) that the drilling is bad for Mother Earth by the environmental crowd won't negate the fact that the vast majority of our domestic crude production is handled safely and without incident... but the exception to the rule (in this case) is going to be all anyone sees for many years into the future.

One further point... on the phone, Jambo mentioned that the slick was far worse than expected and that the possibility stood that the well-head itself was ruptured beyond the means to close it off, allowing as much as 150,000 barrels per day to pour into the Gulf. This estimation, as far as I can see, is worst-case. The size of the slick is measured from satellite data, and it is bigger than expected, but weather conditions in the Gulf have been less-than-ideal and may have contributed to a greater spreading effect (meaning the oil is floating in a slick only half a millimeter think over a greater area than the 2-inch-thick slick that washed ashore after the Valdez wreck). I know that the slick was estimated to reach the Chandeleur Islands (which I have been to... a beautiful spot, believe me) today, and scientists will be able to accurately measure the thickness of the slick as it reaches those shores. Islands more familiar to our group, like the Ship Islands and the Horn Islands, shouldn't see oil till the end of the week (if at all).

What I am trying to say is that, having sent 4 separate ROV missions down to the well-head already, I think I'm more inclined to believe the 5,000 barrel per day estimate than I am the 100,000 barrel estimate, until such time as the exact nature of the leak is determined. What is known to be fact is that the well-head can't be closed without some kind of secondary means not already in place (either a dome placed over it, or additional relief wells drilled through the leaking well), so the leak will continue for the time being. All that can be hoped is that it isn't as bad as the worst-case scenarios have estimated.