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United States Announces $11.2 Million Settlement of Hazardous Waste Case Against ExxonMobil

Release Date: 12/13/2001
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ALAN VINEGRAD , United States Attorney for the Eastern District of New York, and JANE KENNY, Regional Administrator, United States Environmental Protection Agency (EPA) Region 2, today announced one of the largest hazardous waste settlements in history, with the filing of a Consent Decree, settling a hazardous waste case filed in 1996 against MOBIL OIL CORPORATION. The case alleged mismanagement of benzene-contaminated wastes at Port Mobil, a major petroleum product storage and distribution terminal on the Arthur Kill in Staten Island. United States v. Mobil Oil Corporation, 96-1432 (JG). The case was scheduled for trial this week before United States District Judge John Gleeson. The Consent Decree is with EXXON MOBIL CORPORATION, as a result of the 1999 merger of MOBIL and EXXON. The Consent Decree provides for the following: A total payment by EXXONMOBIL of $11.2 million; $8.2 million of the settlement amount is a civil penalty pursuant to the Resource Conservation and Recovery Act ("RCRA"), Title 42, United States Code, Sections 6901, et seq. This is one of the largest civil penalties ever obtained pursuant to RCRA; $3 million of the settlement amount will be used to purchase or restore environmentally sensitive lands in New York City on the Arthur Kill waterway that runs between Staten Island and New Jersey, or nearby; MOBIL admits liability for discharging hazardous wastes from 1991 to1993 into two large artificial ponds on the site without a permit and without the protections required by law; An injunction will be entered requiring EXXONMOBIL to perform cleanup at Port Mobil, to the extent EPA requires it after studies are completed; An injunction will be entered requiring EXXONMOBIL to comply at Port Mobil with the hazardous waste law and regulations raised in the case; and An injunction will be entered barring EXXONMOBIL, nationwide, from arguing that hazardous waste laws do not apply to individual disposal events, but rather only apply if long-term averaging of multiple events demonstrates the existence of toxic levels of waste. In 1996, the United States Attorney’s Office filed this civil environmental case against MOBIL OIL CORPORATION, seeking penalties for violations of RCRA. In enacting RCRA, Congress declared it to be the national policy to reduce or eliminate the generation of hazardous wastes, but to the extent that they are nevertheless generated, to require that the wastes be treated, stored or disposed of so as to minimize the threat to human health and the environment. Accordingly, Congress made it illegal to treat, store, or dispose of hazardous wastes without a permit from EPA. Benzene, a known human carcinogen, became a regulated hazardous waste under RCRA in 1990. The government’s investigation disclosed that MOBIL generated the benzene-contaminated wastes at its Port Mobil Terminal Facility. The facility can store approximately 125 million gallons of petroleum products, including gasoline, fuel oil, heating oil and kerosene. MOBIL distributes these products throughout the northeast by barge. As part of its operation, Port Mobil ran a barge cleaning and vacuuming operation to remove residue petroleum and sediment from the barges after they were unloaded. This process created a petroleum/water mix which was then further processed to draw off as much petroleum as possible; nevertheless, after processing, the mix still contained petroleum residues, including hazardous levels of benzene. Moreover, MOBIL added to its petroleum/water mix hazardous petroleum storage tank bottom waters, and hazardous oil-containing waters that had leached into the surrounding ground area. MOBIL routed this hazardous petroleum/water mix to two large open-air ponds at the site, where it underwent further processing, including mixing with rain water, and then was discharged into the Arthur Kill. On three occasions in 1993, EPA RCRA enforcers caught Mobil unlawfully discharging the benzene-contaminated wastes into the open-air ponds without the permit required by Congress and EPA. EPA’s National Environmental Investigations Center (NEIC) analyzed EPA’s 1993 samples from Port Mobil, and found levels of benzene as much as twenty times in excess of the lawful level. It also determined that the MOBIL wastes were consistently hazardous for benzene, contrary to what MOBIL had indicated in written submissions to EPA in 1992. The government’s investigation determined that the 1992 samples tested by MOBIL were below the prescribed levels only because MOBIL engineers manipulated its testing process, and that additional samples had actually been taken by MOBIL engineers and routinely showed the wastes to be hazardous. When the 1992 manipulated samples were taken, MOBIL personnel feared that a finding of hazardous waste management would force them to either close down their barge cleaning business, at a great loss of profit, or, worse, to close the entire facility. MOBIL also calculated that avoiding federal hazardous waste regulation would save the company millions of dollars in cleanup costs. In 1993, based on the results of its testing, EPA directed MOBIL to cease discharging wastes to the open-air ponds. The investigation disclosed that for several months thereafter, MOBIL unlawfully discharged the hazardous waste waters directly into the Arthur Kill, in violation of the Clean Water Act. In order to obtain permission to treat, store or dispose of waste containing hazardous levels of benzene in its open-air ponds, MOBIL was required to install proper groundwater wells and a monitoring system by September 1991, and to complete a year of groundwater monitoring by September 1992. Mobil failed to install the wells on time, and thereby lost the right to use the ponds for its benzene-contaminated waste. When MOBIL finally did install the wells, it installed them improperly, so that they were not capable of immediately detecting leaks, as the law required. Indeed, although MOBIL advised EPA that the liners in the ponds were leak-proof, internal company records revealed that there might be holes in the liners. In fact, after several years of delay, in 2000 EXXONMOBIL finally inspected the liners, and several holes were found. In announcing the settlement, U.S. Attorney ALAN VINEGRAD stated: "For two years, Mobil Oil dumped benzene-contaminated waste from its Port Mobil facility on Staten Island into ponds and then the Arthur Kill waterway, in violation of federal environmental laws. After years of hard-fought litigation, the government has achieved enormous success in righting the wrongs caused by Mobil’s unlawful conduct - - an $8.2 million civil penalty, funding for the purchase of environmentally sensitive property along the Arthur Kill waterway, the agreement to clean up the Port Mobil facility, and an order prohibiting Mobil from arguing that the environmental laws do not prohibit individual instances of hazardous waste dumping. I commend ExxonMobil for agreeing to take all of these steps in furtherance of our city’s environment." "At a time when we are losing so much green space in and around urban areas, this settlement insures key areas will be preserved or improved. Under the settlement, ExxonMobil will spend $3 million to restore or protect environmentally sensitive lands in the Arthur Kill area," said JANE KENNY , EPA Region 2 Administrator. "While the environmental violations in this case were very serious, a positive result has come from this case." The government’s case was prosecuted by Assistant United States Attorneys Stanley N. Alpert and Richard K. Hayes. Assistance was also provided by Assistant United States Attorneys Charles S. Kleinberg and Kevan Cleary. EPA was represented by Assistant Regional Counsel Stuart Keith.