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This is a brief comparison between the ongoing oil spill in the Gulf of Mexico and a previous oil spill in the Gulf. I cannot say with any confidence that the consequences of the current, Deepwater Horizon spill will be as slight as the fortunately slight effects of Ixtoc 1 of 1979. I present the facts just to keep my readers up to date in an issue which is of concern to many if not all of us.

1979 and 2010

The Deepwwater Horizon oil spill is an environmental catastrophe which is still developing. It is not, however, the only major oil spill to have occured in the Gulf of Mexico. In fact, the second largest oil spill in history occured in 1979 in the western Gulf and it is now known as the Ixtoc 1 oil spill. The Ixtoc 1 well was owned and operated by Pemex, the national oil company of Mexico.

There are many similarities and a few important differences between the Deepwater Horizon oil spill and the Ixtoc 1 spill that occured in the Bay of Campeche, west of the Yucatan peninsula, in 1979. While fishing (and shrimp) returned to that region of the Gulf of Mexico in little over two years, it is still possible that the current oil spill will have more serious environmental consequences.

Voume of Oil

Ixtoc 1 is the second largest oil spill in history, eclipsed only by the intentional oil spill by Saddam Hussein's army as it retreated from Kuwait in 1991. Estimate of Ixtoc 1 volume is 150M gallons of oil. Iraqi deliberate oil spill: 400M gallons. Current, and obviously rough, estimates of Deepwater Horizon oil spill: 20M gallons of oil. Exxon Valdez: 10M gallons.

Cause and Well Capping

The Ixtoc 1 oil leak was caused by a blowout, as with the Deepwater Horizon spill. As with the current case, attempts were made on ixtoc to (a) cap the well with a kind of steel hat, (b) place cement and glass beads into the well and (c) drill relief wells into the leaking well. Only (c) was ultimately successful. The Ixtoc 1 well released oil for approximately 10 months. BP is currently in phase (b) with Deepwater Horizon. A relief well will take until August to complete.

Depth of Well and Oil

A major and potentially serious difference between Ixtoc and Deepwater Horizon is that the former was in only 160 feet of water while the latter is a mile below the ocean's surface. Further, the Ixtoc 1 oil floated fairly readily to the surface while the Deepwater Horizon oil has remained to at least some extent in deep water and has even drifted into deeper water than the location of the well itself. While the reason for this is unclear, the advantage of water closer to the surface is that oil eating microbes seem to have significantly lowered the overall impact of the Ixtoc spill. It is not clear if that natural cleanup will be inhibited in deeper water.

Aftermath

Even afer 31 years, the final effect of the Ixtoc 1 oil spill is not fully known. However, it is clear that it did not produce wide-scale environmental disaster or species extinction. The oil was dispersed or literally eaten within a couple years. Undoubtedly, as with Deepwater Horizon, countless birds and aquatic animals died. One additional effect that may prove important is that of the dispersant chemicals which BP used on the oil. These chemicals are highly toxic and may prove to be even more damaging than the oil itself. But this is speculative.

Policy

I will state one policy issue here, which is the following. Senator Robert Menendez (D-NJ) has produced a bill in the Senate to raise the maximum liability for oil spill damage from $75M to $10B. The effect of this will be to make liability insurance very high and out of the price range for all but the largest oil companies, thereby reducing competition for sea drilling and undoubtedly raising prices. As a firm believer in the free market, however, I believe that liability for damage done by any company searching for oil (or in any other activity for that matter) should rest with that company. An artificial and low cap of $75M does not nearly cover potential cleanup costs. Therefore, while I have not yet studied the Menendez bill, and I do not know if it contains other provisions that would change my opinion, I do not believe that government should subsidize any industry and I agree in principle with this proposed legislation.