Houston-Based Pipeline Company Settles with Feds over Oil Spills

August 12, 2010

The U.S. Environmental Protection Agency (EPA) and the Justice Department announced that Houston-based Plains All American Pipeline and several of its operating subsidiaries have agreed to spend approximately $41 million to upgrade 10,420 miles of crude oil pipeline operated in the United States.

The settlement resolves Plains’ Clean Water Act violations for 10 crude oil spills in Texas, Louisiana, Oklahoma, and Kansas, and requires the company to pay a $3.25 million civil penalty.

“In the last year alone, transportation pipelines released more than two million gallons of oil into the environment, posing a serious threat to human health and natural habitats,” said Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance. “These spills — and the recent pipeline spill in the Kalamazoo River — remind us that we must be diligent in our enforcement efforts and work to ensure that companies are meeting their environmental obligations.”

Between June 2004 and September 2007, more than 273,000 barrels of crude oil were discharged from various pipelines and one tank owned and operated by Plains, some of which entered navigable waters or adjoining shorelines, the EPA’s announcement said. The 10 spills ranged in size from 2.5 barrels to 4,500 barrels and most were caused by pipeline corrosion.

As part of the agreement, Plains must take steps to replace or install corrosion control equipment, perform pipeline inspections, assess the integrity of newly acquired pipelines, improve leak detection practices and capabilities, and provide proper training for personnel. In addition, Plains must ensure that all breakout tanks used to replace or substitute existing tanks that relieve pipeline surges have adequate capacity to contain such surges and are properly located within secondary containment.

The Clean Water Act makes it unlawful to discharge oil or hazardous substances into waters of the United States or adjoining shorelines in quantities that may be harmful to the environment or public health. The $3.25 million penalty will be deposited in the federal Oil Spill Liability Trust Fund. The funds will be used to finance federal response activities and provide compensation for damages sustained from future discharges or threatened discharges of oil into water or adjoining shorelines.

According to recent pipeline spill reports, in the last year, more than 50,000 barrels (2.1 million gallons) of oil spilled from transportation pipelines across the nation. EPA’s enforcement responses to spills that affect waters of the United States under the Clean Water Act are critical to ensure that responsible companies are penalized for the spills and are required to take appropriate actions to reduce the potential for future spills.

The consent decree, filed in the U.S. District Court for the Southern District of Texas, is subject to a 30-day public comment period and approval by the federal court.

Source: Environmental Protection Agency

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