ConocoPhillips lawsuit (re oil spill in China)


In 2011, a subsidiary of a US based company ConocoPhillips, ConocoPhillips China, caused an oil spill in the Bohai Sea in China, which severely damaged the ecosystem in the Bohai Bay and greatly affected the livelihoods of local fishermen.  In January 2012, ConocoPhillips and its partner, the China National Offshore Oil Corporation, reached an agreement with China's Ministry of Agriculture and State Oceanic Administration to settle compensation claims in amount of 1.09 billion yuan in relation to fishery-related losses in Hebei and Liaoning provinces.  However, fishermen from some other areas, allegedly also affected by the spill, were excluded from the compensation scheme.

Litigation in China

Aqua-farmers from the affected areas filed several lawsuits before the Tianjin Maritime Court and the Qingdao Maritime Court.  In 2011, a group of fishermen from Hebei and Liaoning provinces, who did not join the 2012 settlement process, filed a lawsuit in Tianjin court.  In 2015, the court ordered ConocoPhillips to pay them 1.68 million yuan ($265,000).  This group of plaintiffs was the first to have their claim accepted.  The same year, Qingdao court effectively refused to hear a claim brought by Shandong fishermen by neither accepting nor rejecting the lawsuit.  In July 2015, Qingdao Maritime Court accepted a case filing by a Chinese environmental NGO against ConocoPhillips and its partner.  However, the case concerns only the reparation of environmental damage and does not include compensation claims for farmers.  Also in 2015, after Tianjin court initially declined to hear a claim by a group of Tianjin fishermen, five of them refiled a lawsuit, which this time was accepted.  The hearings on the case started in December 2016.  In December 2016, Qingdao maritime court also admitted a lawsuit filed by 205 fishermen from Shandong province claiming a compensation of 170 million yuan ($24.4 million) and asked the parties to submit their evidence.   

Litigation in the US

On 2 July 2012, a group of 30 fishermen from Shandong province filed a lawsuit against ConocoPhillips in US federal court in Texas, where ConocoPhillips is headquartered.  The plaintiffs claimed that the US lawsuit was their only chance to get justice for the effect of oil spills on their livelihoods due to the Chinese Government blocking access to its own court system.  Some plaintiffs claim they have been warned, threatened and monitored by local governmental officials in Shandong, and intimidated into withdrawing the lawsuit.  On 16 October 2012, a group of 167 fishermen from Hebei province also filed a petition in Texas court to depose executives from ConocoPhillips, claiming that it directly relates to claims they have presented before the Chinese court.  ConocoPhillips argued that US courts do not have jurisdiction over the plaintiffs’ claims and that the lawsuit should be dismissed.  The company also claimed that according to the report by Chinese Ministry of Agriculture, fishermen in Shandong had not been affected by the oil spill.  ConocoPhillips argued that if the plaintiffs could prove they had been affected, they could seek compensation through the Ministry of Agriculture.  On 8 November 2016, the US district court of Southern Texas dismissed the civil claim of Shandong fishermen and the petition for deposition by Hebei fishermen.

- “Shandong fishermen sue ConocoPhillips in US”,, 5 Apr 2013
- “Beijing warns Shandong fishermen against suing ConocoPhillips over Bohai oil spill”, Stephen Chen, South China Morning Post, 3 Apr 3, 2013
- “ConocoPhillips Sued By Fishermen For China Oil Spills”, Juan A. Lozano, HuffPost Green, 2 Jul 2012

- [PDF] Peiqing Cong, et al. v. ConocoPhillips - ConocoPhillips Company's Reply Brief in Support of its Motion to Dismiss, 11 Jan 2013
- [PDF] Peiqing Cong, et al. v. ConocoPhillips - Complaint for Damages and Injunctive Relief, 2 Jul 2012 [plaintiffs' complaint filed at the US District Court for the Southern District of Houston]

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28 December 2016

China: Fishermen from Shandong province to sue ConocoPhillips over impacts of 2011 oil spill on livelihood

Author: Global Times (China)

"Shandong fishermen file 170 million yuan lawsuit for 2011 Bohai Bay oil spill", 28 Dec 2016

A maritime court in Qingdao, East China's Shandong Province has asked the parties involved in the oil spill in Bohai Bay in 2011 to submit their evidence Wednesday in a multi-million yuan lawsuit against multinational oil and gas producer ConocoPhillips and State-owned China National Offshore Oil Corporation (CNOOC).  85 fishermen from Muping district and another 120 from Changdang county, Yantai, Shandong Province are suing ConocoPhillips and CNOOC for 170 million yuan ($24.4 million).  Seven of the Yantai fishermen attended the Wednesday hearing, China Youth Daily reported...The oil spill took place in June 2011 at the Penglai 19-3 oil field, which was being jointly developed by ConocoPhillips and CNOOC...

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9 December 2016

China: Court hears lawsuit by fishermen against ConocoPhillips over impacts of oil spill on livelihood

Author: Xu Yaqi, Crienglish (China)

"Court starts hearing lawsuit over U.S. ConocoPhillips oil leakage case", 9 Dec 2016

The maritime court of Tianjin in China on Friday started hearing a case lodged by five local fishermen against two oil companies from the U.S and China for an oil spill in June 2011.  The ConocoPhillips and the China National Offshore Oil Corporation conducted cooperation in exploiting the Penglai 19-3 oilfield...where oil was spilled, polluting a sea area...The plaintiffs asked the two oil companies to compensate them...for their financial losses plus the cost of litigation.  They also demand a clean-up of Bohai's ecological environment.  According to a joint report...ConocoPhillips was the operator at the field when the oil was leaked, so all responsibilities should be claimed by the U.S. developer.  ConocoPhillips said in its statement of defense that the company had already paid one billion yuan for damages...However, fishermen from Shandong Province and Tianjin City...have not been covered by the compensation...It is reported that at that time there were 107 fishermen altogether from Tianjin and another 310 from Shandong filing this lawsuit that asked for a 1 billion yuan compensation.  However, the court didn't accept that case.  In 2015, the fishermen lodged litigation once again, and the accusation was accepted in the same year. 

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21 April 2014

Escaping Liability Via Forum Non Conveniens: ConocoPhillips's Oil Spill in China

Author: Chenglin Liu, University of Pennsylvania Journal of Law and Social Change, Article 3 in Vol. 17 Issue 2

In 2011...ConocoPhillips’s subsidiary in China caused a massive oil spill in the Bohai Sea. A group of fishermen suffered severe property damage as a result of the oil spill. After a failed attempt to have their complaint heard in a Chinese court, the fishermen sued ConocoPhillips in the United States District Court in Houston, Texas. It is very likely that the Houston District Court will deem the Chinese courts the more appropriate forum for this case...This [paper] argues that the Chinese courts are neither an available nor an adequate forum for mass tort cases involving environmental damage...A superficial examination of Chinese law as written is insufficient, because the laws on the books in China are often disregarded...U.S. courts should allow for a substantial examination of how these laws are implemented when deciding the adequacy of a Chinese forum. Finally, [this paper argues that] it is in the interest of U.S. courts to impose liability on U.S. corporations that inflict tortious acts in foreign countries...

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2 July 2012

Chinese fishermen sue ConocoPhillips over spills

Author: Associated Press

A group of 30 Chinese fishermen sued ConocoPhillips in U.S. federal court…, claiming their livelihoods have been greatly impacted by two oil spills last year from the company's offshore drilling operations in northeastern China. Attorneys for the fishermen said the lawsuit was filed…in Houston…because courts in China have blocked their efforts to file a similar suit…Calls and emails to ConocoPhillips were not immediately returned Monday. In prior statements, CEO Jim Mulva has apologized for the oil spills' impact, and the company has set up compensation funds… ConocoPhillips and its partner, the China National Offshore Oil Corp., reached a $160 million agreement in January with China's Ministry of Agriculture to settle compensation claims related to the spill…[T]he fishermen's attorney alleged that his clients have been excluded from making compensation claims because of a complicated and bureaucratic system that has been set up to distribute the funds.

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5 June 2012

ConocoPhillips China Confirms Oil Is Leaking Into Bohai Again [China]

Author: Wang Xiaocong, Caixin [China]

More crude is leaking at an oilfield in the Bohai Sea…where a major spill occurred last year. In the latest incident, ConocoPhillips China said 0.6 tons of crude oil were spilled…ConocoPhillips China and China National Offshore Oil Corp. (CNOOC) own the oilfield. The latest spill occurred at a different platform than the two that leaked last year. CNOOC released a statement…that…rig operator ConocoPhillips…said that a safety device on a valve on the main pipe failed. ConocoPhillips also told CNOOC that it cleaned up the oil slick immediately after it was discovered. An inspection by CNOOC showed that…on June 4, no oil was seen on the water…

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26 January 2012

Conoco, Cnooc Parent Reach $160 Million Oil Spill Settlement [China]

Author: Jason Paton, Bloomberg

ConocoPhillips and China National Offshore Oil Corp. will pay…$160 million to compensate Chinese fishermen for losses arising from oil leaks…The companies reached an agreement with the agriculture ministry to pay 1 billion yuan, Conoco...said...That’s more than four times the 234 million yuan ($37 million) 29 fishermen had sought in a lawsuit for the loss of clams and sea cucumbers resulting from spills...In a sign that China is cracking down on polluters, Premier Wen Jiabao demanded a “thorough” investigation…after China’s maritime regulator ordered Conoco…to shut the field…[but] it’s a “drop in the bucket” for Conoco...The compensation surpasses the 3.26 million yuan a unit of Zijin Mining Group...agreed to pay last year after the collapse of a tailing dam at a tin mine in 2010 killed 22 people...The payments contrast with the $20 billion fund…demanded from compensate victims of the worst U.S. oil spill…[also refers to PetroChina]

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