Insurer Ordered to Pay $1 Billion Over 2002 Prestige Oil Spill

The sinking of the Greek tanker released an estimated 63,000 tonnes of foul-smelling black fuel along the Galicia coast and forced the closure of the country’s richest fishing grounds.

The sinking of the Greek tanker released an estimated 63,000 tonnes of foul-smelling black fuel along the Galicia coast and forced the closure of the country’s richest fishing grounds.

A Spanish court has ordered a British P&I insurer to pay a whopping $1 billion fine over the 2002 Prestige oil spill. 

The single-hulled oil tanker Prestige broke in half and sank off the northwestern coast of Spain after being denied a port of refuge after a tank was damaged in a storm. The wreck is estimated to have spilled some 63,000 tonnes of oil, fouling Spain’s Galicia coast and closing some of the country’s richest fisheries. The incident is considered one of Europe’s worst-ever environmental disasters.

A Spanish court on Wednesday ordered the London Steam-Ship Owners’ Mutual Insurance Association, aka the London Club, which insured the ship, to pay up to $1 billion in damages.

The London Club said it was aware of the judgment and “remains concerned at the direction that the Spanish court has taken generally.”

The Prestige’s captain, Apostolos Mangouras, was initially clear of criminal wrongdoing, but in January 2016, Spain’s Supreme Court overruled and convicted him of recklessness resulting in catastrophic environmental damage. Mangouras was sentenced to two years in prison, and the ruling opened the door to damage claims against him and the insurer.

The total damage bill has been estimated at over 4 billion euros. 

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