The Offshore Pollution Liability Association Ltd

Liability under OPOL

Parties to OPOL accept strict liability, that is to say they are liable to meet claims unless they can establish that the incident:

a) resulted from an act of war, hostilities, civil war, insurrection, or a natural phenomenon of an exceptional, inevitable and irresistible character;

b) was wholly caused by an act or omission of a third party with intent to cause damage;

c) was wholly caused by the negligence or other wrongful act of any State or other authority, or resulted from compliance with conditions or instructions given by the licensing State;

d) resulted wholly from or partially either from an act or omission of the claimant done with intent to cause damage, or from the negligence of that claimant, in which case the liability is reduced accordingly.

Limit Upon Liability

The maximum liability of a party under OPOL is US $120,000,000 per incident. This is made up of US $60,000,000 to cover pollution damage claims and US $60,000,000 for remedial measures. However when all the claims in one category have been met, any surplus may be used to meet unsatisfied claims in the other category. If the total claims in a category exceed the sums available in that category, then after any surplus from the other category has been fully utilised, the compensation is pro-rated amongst the claimants.

Establishment of Financial Responsibility

Parties to OPOL undertake to establish and maintain their financial responsibility to meet their obligations for an amount of not less than US $120,000,000 for any one incident and US $240,000,000 in the annual aggregate.

Contribution to Claims

Under OPOL the parties agree to contribute to the payment of claims due from a party that fails to meet its obligations to claimants. Contributions by the remaining parties are proportionate to the number of offshore facilities operated by the parties.

Disputes

In the event of any dispute arising between a claimant and a party, provision is made for arbitration in London in accordance with the rules of the International Chamber of Commerce.

Administration of OPOL

The Offshore Pollution Liability Association Limited ("the Association") was formed in England to administer OPOL. All parties to OPOL are members of the Association.

The Association is primarily concerned with the administration of OPOL and the relations between the parties, but in addition it administers the contributions referred to above and, at the request of any State to which OPOL applies, will confirm to that State that a party has accepted OPOL and established satisfactory evidence of financial responsibility.

Duration of OPOL

OPOL came into effect on 1st May 1975 and continues indefinitely.