CLAIM SUMMARY / DETERMINATION FORM 

Date : 4/27/2010 

Claim Number : P05005-158

Claimant : Sunoco, Inc. 

Type of Claimant : Corporate (US) 

Type of Claim : Loss of Profits and Earning Capacity 

Claim Manager :

Amount Requested : $19,427.00

FACTS: 

A. Oil Pollution Incident: 

On 26 November 2004, the Cypriot-flagged tank vessel ATHOS I struck a submerged anchor as 

it approached the CITGO Asphalt Refining Company terminal in Paulsboro, New Jersey. The 

anchor punctured the hull and caused the release of Venezuelan crude oil into the Delaware 

River. The Federal On Scene Coordinator (FOSC) issued a Notice of Federal Interest (NOFI) 

designating the vessel’s owner, Frescati Shipping Company Limited, as the Responsible Party 

(RP). After it paid for costs exceeding its limit of liability, the RP denied all claims under the 

Oil Pollution Act of 1990 (OPA). The RP acknowledged the claim submitted by Sunoco via an 

email dated November 1, 2007 and deemed the claim denied. It is important to note that when 

the Sunoco claim first arrived at the NPFC, the NPFC identified it as claim # P05005-140 but 

later decided to divide the Sunoco claim into two separate claims identified as # P05005-140 

claim for Sunoco refinery loss of profits and earnings claim and # P05005-157 claim for 

Sunoco’s vessel delay loss of profits and earnings. After the NPFC completed the initial 

adjudication of the claimant’s first two claims, it became evident that the NPFC did not include 

the increased expense portion of Sunoco’s claim in either of the preceding claims therefore the 

NPFC opened a new claim # P05005-158 in order to capture the increased expenses originally 

submitted with the initial Sunoco claim submission. 

B. Claim Detail: 

Claimant, Sun International Ltd. (Sunoco) presents this claim to the National Pollution Funds 

Center (NPFC) for reimbursement from the Oil Spill Liability Trust Fund (OSTLF) for loss of 

profits and earning capacity associated with increased expenses as a direct result of the Athos I 

oil-spill. Claimant seeks $19,427.00 in reimbursement for increased expenses for work 

performed by Blank Rome in order to obtain a Jones Act waiver of the coastwise laws pursuant 

to the Act of December 27, 1950, so that certain foreign-flag vessels, including the Greek-flag 

North Star, may transport crude oil from the Big Stone Anchorage in the Delaware Bay to 

Sunoco’s Philadelphia, Marcus Hook, and Eagle Point Refineries. The request stemmed from 

the Athos I oil-spill in the Delaware Bay on November 27, 2004, which has significantly delayed 

vessel traffic up and down the Delaware River such that the available capacity of coastwisequalified vessels was not sufficient to keep the oil-refineries in the Delaware Valley area 

adequately supplied with crude oil.
APPLICABLE LAW: 

In general, claims for the removal costs or damages must first be presented to the RP per 33 USC 

2713(a). If the RP denies the claim or does not settle the claim within ninety days, the claimant 

may commence an action in court against the RP or present the claim to the Fund. 33 USC 

2713(c)

The uses of the OSTLF are described at 33 USC 2712(a). It provides in relevant part that:

“The Fund shall be available to the President for the payment of claims in accordance with 

section 2713 of this title for uncompensated removal costs determined by the President to 

consistent with the National Contingency Plan or uncompensated damages.”

Damages include damages for loss of profits or earnings capacity as a result of loss or 

destruction or real or personal property or natural resources. 33 USC 2702(b)(E) Damages are 

further defined to include the costs of assessing the damages. 33 USC 2701(5)

Damage claims must be presented within 3 years after the date on which the injury and its 

connection with the discharge in question were reasonably discoverable with the exercise of due 

care. 33 USC 2717 (h)(2)

In any case in which the president has paid an amount from the Fund for any removal costs or 

damages specified under subsection (a), no other claim may be paid from the Fund for the same 

removal costs or damages. 33 USC 2712 (i)

Congress directed the President to promulgate regulations “for the presentation, filing, 

processing, settlement, and adjudication of claims...” 33 USC 2713 (e) Those regulations are 

found at 33 CFR part 136.

Under 33 CFR 136.105(a) & 136.105(e)(6), the claimant bears the burden of providing all 

evidence, information, and documentation deemed necessary by the Director, NPFC, to support 

the claim. Further, a claim presented to the Fund should include, as applicable:

“the reasonable costs incurred by the claimant in assessing the damages claimed. This 

includes the reasonable costs of estimating the damages claimed, but not attorney’s fees 

or other administrative costs associated with the preparation of the claim.” 33 CFR 

136.105(e)(8).”

With regard to claims for loss profits and impairment of earning capacity, the NPFC must 

independently determine that the proof criteria in OPA and the implementing regulations, at 33 

CFR part 136 are met, including the general provisions of 33 CFR 136.105, and the specific 

requirements for loss of profits and earning capacity claims in Subpart C, 33 CFR 136.231, et 

seq.

Pursuant to the provisions of 33 CFR 136.231, claims for the loss of profits or impairment of 

earning capacity due to injury to, destruction or, or loss or real or personal property or natural 

resources may be presented to the Fund by the claimant sustaining the loss or impairment.

“In addition to the requirements of subparts A & B or this part, a claimant must establish the 

following-

(a) That real or personal property or natural resources have been injured, destroyed, or lost.
(b) That the claimant’s income was reduced as a consequence or injury to, destruction of, or 

loss of the property or natural resources, and the amount of that reduction.

(c) The amount of the claimant’s profits or earnings in comparable periods and during the 

period when the claimed loss or impairment was suffered, as established by income tax 

returns, financial statements, and similar documents. In addition, comparable figures for 

profits or earnings for the same or similar activities outside of the area affected by the 

incident also must be established. 

(d) Whether alternative employment or business was available and undertaken and, if so, the 

amount of income received. All income that a claimant receives as a result of the incident 

must be clearly indicated and any saved overhead and other normal expenses not incurred 

as a result of the incident must be established.” 33 CFR 136.233(a-d)

If a third party claimant or RP is able to establish an entitlement to lost profits, then 

compensation may be provided from the OSLTF, but the compensable amount is limited to the 

actual net reduction or loss of earnings and profits suffered. Calculations for the net reductions or 

losses must clearly reflect adjustments for the following: all income resulting from the incident, 

all income from alternative employment or business undertaken, potential income from 

alternative employment or business not undertaken but reasonably available, and saved overhead 

or normal business expenses not incurred as a result of the incident, and state, local, and federal 

tax savings. 33 CFR 136.235(a-e)

DETERMINATION OF LOSS: 

A. Overview:

1. The incident involved the discharge and continuing substantial threat of discharge of 

“oil” as defined in OPA 90, 33 U.S.C. § 2701(23), to navigable waters.

2. Real or personal property or natural resources have been injured, destroyed, or lost; 

specifically oil was released into and injured the Delaware River, a natural resource of 

the United States.

3. In accordance with 33 CFR § 136.105(e)(12), the claimant has certified no suit has been 

filed in court for the claimed uncompensated removal costs.

4. The claim was submitted on time.

5. The claimant seeks $19,427.00 in loss of profits, as a consequence of Sunoco’s additional 

costs.

6. The claimant asserts that if not for the oil spill the claimant would not have incurred

additional expenses.

7. Presentment of costs to the RP was made by the NPFC for which the RP responded 

denying responsibility for these costs.

8. In the process of adjudicating this claim, the NPFC Claims Manager collected additional 

information from the claimant to document what took place at the time of the incident.

B. Causation:

The Athos I oil-spill did in fact release significant amounts of oil into and causing damage 

and injury to the Delaware River, a natural resource of the United States. The resulting 

damage, injury and removal response disrupted shipping in and out of the Delaware River.1 

At the time of the spill, there were many large vessels in the area that were oiled due to the 

Athos I oil-spill. 

 

1 The FOSC ordered the river closed; POLREPs and FOSC documentation clearly show Sunoco’s facilities within 

the impacted area.
C. Analysis: 

As discussed previously, this claim arises from the Athos I oil-spill incident on the Delaware 

River that occurred on November 26, 2004, which increased Sunoco’s expenses due to 

shipping delays resulting from the slowed or stopped marine traffic on the Delaware River 

and as a result of activities performed in order to obtain a Jones Act waiver. The Sunoco 

Refineries in the region are highly dependent on river traffic, primarily for crude oil 

deliveries; typically 22 crude cargoes are required each month to maintain operations and 

cargoes are often discharged at multiple docks as shipments are shared between the Sunoco 

refineries. A typical crude oil cargo of one million barrels provides enough feedstock for the 

local refineries to operate for only 11⁄2 days. The oil spill specifically impacted four vessels 

that were chartered by Sunoco, increasing transit times in aggregate by approximately 

6.79583 days in November and December 2004. The financial impacts of this delay were 

increased expenses and lost profits resulting from the additional charter hires and lightering 

services required to make the crude oil deliveries to Sunoco’s refineries.2

To receive payment from the Fund for lost profits, a claimant must prove that it lost profits 

and that those profits resulted from the oil-spill. For example, decreased revenue and/or 

increased expenses caused by the oil spill that reduce the profits the claimant would have 

otherwise earned would be compensable as lost profit damages by the Fund. In this instance, 

the Delaware Bay is deemed a natural resource that has been injured by the Athos I oil-spill 

therefore decreased revenue and/or increased expense(s) experienced by Sunoco that reduced 

their profits which would otherwise have been earned are deemed compensable under OPA. 

In Sunoco’s claim submissions, it is important to note that Sunoco’s increased expenses 

continued throughout the Athos I oil spill for the time period between November 2004 and 

December 2004 without offsetting Sunoco’s revenues. While a loss of profits claim in and of 

itself does not necessarily equate to increased expenses, the financial data provided by the 

claimant demonstrates that Sunoco could not pass the increased cost on to others because this 

type of increased expense would have no impact on pricing revenues since the pricing for 

refinery product is determined by the market.3 As the claimant demonstrates, it was unable 

to offset the additional expenses. This claim deals with contracts where the revenue is fixed 

and the profit was directly affected by the expenses the claimant incurred in the process of 

fulfilling contractual commitments. Because the claimant could not increase prices and 

continued to incur expenses (i.e. mitigation costs associated with requesting a Jones Act 

waiver), the claimant effectively lost profit that it would have earned, had the vessels not 

been delayed by the oil spill. 

Moreover in this case, the significant reduction of oil supplies to Sunoco’s three refineries in 

the Delaware Valley area would jeopardize the continued availability of energy supplies to 

the east coast of the United States, at least in the short term and possibly in the long term. 

Thus, consistent with the opinion of Department of Energy4

, it was in the best interest of the 

national defense to ensure that there were no significant shortfalls to energy supplies 

provided by these three refineries, particularly as winter approached. As noted in Sunoco’s 

 

2

 See, Claim Supporting Documentation found in Volume 1 of 3; page 14 under the Narrative Section of the claim 

submission for claim # P05005-157. 

3

 See, Weekly United States Spot Price FOB Weighted by Estimated Import Volume (Dollars per Barrel) which 

demonstrates that the price of oil the months of November and December 2004 decreased and were not passed on to 

Sunoco’s customers

4

 See, Claim Supporting Documentation email from of DOE to of Sunoco dated 

December 5, 2004. 
initial claim submission and in addition to the Stena Vision, which was at anchor at the time 

of the incident and with Sunoco expecting four more tankers the weekend following the oilspill, Sunoco requested a waiver of the coastwise laws and authorization to use the foreignflag vessel North Star, or other foreign-flag vessels as necessary, for a period of 10 days or 

until the Delaware River opened to unrestricted vessel traffic, whichever was longer. 

D. Determination: 

The NPFC hereby determines that the OSLTF will pay $19,427.00 as full compensation for 

the damage costs incurred by the Claimant and submitted to the NPFC under claim # 

P05005-158. All costs claimed are for charges paid for by the Claimant for damages as that 

term is defined in OPA and, are compensable damages, payable by the OSLTF as presented 

by the Claimant. 

AMOUNT: $19,427.00

Claim Supervisor: 

Date of Supervisor’s review: 

Supervisor Action: 

Supervisor’s Comments: