Shell reaches $5.8m settlement for US pollution violations

23 April 2009 18:42  [Source: ICIS news]

HOUSTON (ICIS news)--Shell has reached a $5.8m (€4.5m) settlement with two environmental groups over alleged US Clean Air Act violations at the company’s site in Deer Park, Texas, along with agreeing to extensive emission reductions and upgrades, both sides said on Thursday.

“Texans couldn’t count on our state environmental agency to hold polluters accountable, so citizens had to step in to demand compliance with the law,” said Luke Metzger, director of Environment Texas.

“This settlement will mean cleaner air for the Houston region and should serve as notice to other polluters playing fast and loose with our environmental laws," he said.

Metzger’s Environment Texas group joined with the Sierra Club to file a lawsuit against Shell in January 2008 due to alleged pollution violations at the Deer Park facility.

In addition to the civil penalty, the settlement requires an 80% reduction in upset emissions within three years. Upset emissions are considered emissions occurring as a result of equipment breakdowns, malfunctions and other non-routine occurrences, the groups said.

Failure to meet that figure would subject the oil and chemical company to automatic monetary penalties for each pound above the maximum.

“This unique approach to upset events – a ‘hard cap’ on emissions, regardless of cause – creates a powerful incentive for Shell to prevent upsets and minimise pollution releases,” the environmental groups said in a joint statement.

Emission reductions under the settlement include nitrogen oxides, volatile organic compounds, sulphur dioxide, benzene and 1,3-butadiene, the groups said.

More than a thousand violations involving those chemicals have occurred at the facility since 2003, the group said, resulting in the release of 5m lbs (2,268 tonnes) of pollutants in that time.

The facility must also undergo upgrades designed to cut emissions from the most heavily used chemical flare, as well as upgrade the company’s monitoring system for benzene emissions.

“Shell shares the goal of the Sierra Club and Environment Texas to improve air quality,” Shell said in a statement.

“We strive to operate in compliance with all permits and regulations,” the statement added. “We are pleased that we have reached an agreement with the citizen groups to resolve the matter, avoid continued litigation and provide benefits in the public interest.”

The $5.8m civil penalty is believed to be the largest in an environmental citizen suit in Texas history, and nationally one of the largest ever against a single facility, the groups said.

The payment will be used to fund environmental, public health and education projects in the Houston area, including a project to reduce diesel emissions from school buses.

“We are particularly pleased with the provisions of the agreement that provide for the disbursement of funds to benefit Harris County [Texas] children – through the retrofitting of school buses and the development of environmental education programs – and to aid the development of solar energy systems in Harris County,” Shell said.

Shell’s Deer Park facility is the nation’s eighth-largest oil refinery and one of the world’s largest sources of petrochemical production, the groups said.

The settlement is subject to approval by the US Environmental Protection Agency (EPA) and the US Department of Justice (DOJ).

($1 = €0.77)

For more on Shell visit ICIS company intelligence
For more on benzene and butadiene visit ICIS chemical intelligence
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By: Ben DuBose
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