BOSTON -- Picture this:

Two oil tankers collide early in the day about 140 miles off the coast of Massachusetts and start leaking crude oil into the waters of Georges Bank, threatening birds, fish and lobsters in one of the richest fishing grounds in the world.

By early afternoon, the ships have spilled more than 3.5 million gallons of crude oil into the north Atlantic, according to Coast Guard officials in Boston, who struggle to implement a joint-response plan with their Canadian counterparts.

No injuries are reported, but both vessels are damaged and leaking oil. The collision produces a slick of crude oil four to six miles long and four miles wide, spinning slowly clockwise and moving six to 12 miles a day toward shore in light winds and gentle seas.

At the Coast Guard base in Boston, the on-scene commander, Capt. William Boland, asserts federal authority over the spill and directs U.S. and Canadian vessels to the scene. Officials consider whether to drop chemical dispersants on the spill to break up the oil slick.

None of this happened. But all of it could have happened.

So, dozens of officials from the Coast Guard, the oil industry and government agencies from the United States and Canada gathered here for four days last week to act out the roles they would play if such a spill had occurred.

These war games in the battle to save the environment are staged every two years along the East Coast to let the two nations test their communications, gear and assumptions. In this year's exercise, the first since the Exxon Valdez disaster in Alaska in March 1989, participants battled the hypothetical spill for three days, then essentially declared victory and went home.

Rear Adm. Richard I. Rybacki, commander of the U.S. Coast Guard 1st District, pronounced himself "very pleased" by the joint exercise, saying the drill improved both nations' ability to respond to a real spill by testing their equipment, expanding the scientific data base and letting the participants get to know each other.

Rybacki and other officials in the drill said they believe that they have the legal authority needed to respond to such a spill, even if a recalcitrant owner refuses to take responsibility. But U.S. and Canadian officials stress that there is a general shortage of equipment to deal with a major spill.

"Very obviously, we don't have all the equipment we would like, and we don't have it in the places we would like," Rybacki said, blaming lack of funds and Congress's refusal to authorize a new class of buoy tenders that the Coast Guard wants to outfit with pollution-fighting equipment.

Ken Curren, director general of the Canadian Coast Guard for the Maritimes, said the situation was similar in Canada. "We are looking forward to new and additional equipment," he said.

Officials on both sides emphasized that the Coast Guard's role in dealing with oil spills is changing. Increasingly, they said, owners of oil tankers are expected to take responsibility and pay for cleaning spills, while private contractors are expected to do much of the actual work. The Coast Guard expects to provide oversight and coordination and to step in directly only when necessary.

In this year's drill, the players were confronted with a hypothetical spill of 3.5 million gallons of crude oil. Eighteen hours later, the on-scene commander authorized the ships' owners to test a chemical dispersant. The next day, the U.S. and Canadian commanders on the scene gave the go-ahead to spray dispersants from aircraft.

At a debriefing, Boland said he had few options. He said ships outfitted with skimming and pumping equipment would arrive too late and pose a risk to their crews. He also said he did not consider use of polymer coagulants, which might turn the oil into a floating semi-solid, because the scientific advisory panel did not recommend it.

Although the drill's planners tried to make it as realistic as possible, they also acknowledged that a real spill would present different challenges. For example, participants knew that the exercise was planned and assembled in Boston, and no one was asleep, on vacation or on duty in the Persian Gulf.

Conditions were nearly ideal -- sunny, cool days with light winds and seas. Officials admitted that a hurricane or blizzard might overwhelm their plans.

In addition, the drill involved government scientists and invited guests from the oil and cleanup industries but no members of private institutions such as the New England Aquarium, Greenpeace or the Massachusetts Audubon Society, which surely would become involved in a real spill.

An actual spill also would trigger an international media frenzy, in contrast to the polite questions from a few reporters last week.

Still, there were indications that the joint exercises are contributing to readiness.

One assessment came from retired Coast Guard captain Lynn Hein, who commanded the response when the Argo Merchant ran aground off Nantucket Island Dec. 15, 1976, spilling 7.7 million gallons of oil.

Invited to observe this year's drill and comment, Hein said he had to confront a major spill without the command structure and scientific advisory board now in place and without the computerized communications and weather-forecasting gear introduced in the last 14 years.

"I can say we've come a long way from the Argo Merchant scenario," Hein said. Then he added that there is still much to do.