Nick Snow
OGJ Washington Editor
WASHINGTON, DC, Aug. 12 -- Plains All American Pipeline LP agreed to spend $41 million over 3 years to resolve federal charges arising from 10 crude oil spills in four states, the US Department of Justice and Environmental Protection Agency said in separate Aug. 10 announcements. DOJ and EPA said the Houston-based firm will spend the money to upgrade 10,420 miles of pipeline, and pay an additional $3.25 million fine.
The spills occurred between June 2004 and September 2007, and involved 6,510 bbl of crude released from its pipelines and a terminal in Texas, Louisiana, Oklahoma, and Kansas, the two federal entities said. The discharges ranged in size from 2½ bbl to 4,500 bbl and mostly involved pipeline corrosion.
In a separate statement, Plains said that the settlement of federal Clean Water Act charges mainly involved a 2004 leak which reached the Pecos River and a 2005 leak which reached the Sabine River as well as eight smaller releases. “This agreement represents more than 4 years of information sharing and negotiation, which began shortly after the incidents occurred,” it noted.
Many of the consent decree’s requirements already have been incorporated into Plains’ operations because of this process, and the anticipated compliance costs have been reflected in operating and financial guidance which it has filed with the US Securities and Exchange Commission, the partnership said. The cash settlement’s full amount was included in its contingency accruals as of June 30, it added.
Under the consent decree, Plains agreed 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, according to EPA. It also said that 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 consent decree was filed in US District Court for southern Texas and is subject to a 30-day public comment period and final court approval, DOJ and EPA said. They indicated that the $3.25 million fine will be deposited into the federal Oil Spill Liability Trust Fund.
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US Government Accountability Office.
