Australia offered $21 mn oil spill compensation

SYDNEY: A Hong Kong-based shipping company will pay Australia 25 million dollars (21 million US) in compensation for a massive toxic oil spill during a wild storm, officials said on Saturday.

Swire Shipping's cargo liner Pacific Adventurer released about 200,000 litres (53,000 US gallons) of heavy fuel oil off the coast of Queensland state as it travelled through cyclonic weather on March 11.

Vast stretches of popular tourist beaches were blackened by the sludge, which spilled from the hull after it was pierced by fertiliser containers as they fell overboard in heavy seas.

It was one of Australia's worst-ever oil spills.

Swire said the compensation figure far exceeded its legal obligation of between 14.5 and 17.5 million dollars.

"We very much regret the accident, caused by Cyclone Hamish, that resulted in the oil spill - and also the effect of the spill on the Queensland coastal environment and the people of Queensland," said Bill Rothery, head of Swire's Australian operations.

Queensland Premier Anna Bligh welcomed the settlement, which she said had taken five months of "hard work and a lot of public outcry".

"Frankly, I wish they'd done it a lot earlier and I wish we hadn't had an argument about it," Bligh said.

"Ultimately they've gone further than they've wanted to and that's a good thing."

The ship's Filipino captain, Bernardino Gonzalos Santos, 47, has been charged with illegally discharging oil, and faces fines of up to 350,000 dollars.

A preliminary transport bureau investigation into the accident found Santos set course toward Queensland despite knowing extreme weather lay ahead.

If successfully prosecuted for environmental or maritime breaches, Swire faces 1.5 million dollars in fines.

Both the national and Queensland governments have said they were seeking legal advice on further court action.