Petrobras agrees to settle US refinery pollution suit for $3.5m

26 July 2018 21:55 Source:ICIS News

HOUSTON (ICIS)--A subsidiary of Petrobras has agreed to pay $3.5m to settle a lawsuit that accused its Texas refinery of violating clean-air laws in the US, according to a proposed order that was filed on Thursday.

Environment Texas and Sierra Club sued Pasadena Refining System Inc (PRSI) in 2017, alleging that the company's refinery in Pasadena repeatedly violated pollution regulations for five years.

If the court approves the proposed settlement, then PRSI will pay a $350,000 civil penalty to the US Department of Treasury.

PRSI will pay another $3.175m to fund a programme that will help communities buy electric-vehicles and other low-emission vehicles for municipal fleets, the proposed order said.

In addition, PRSI will maximise the use of the refinery's electrostatic precipitator (ESP) to control emissions from the complex's fluid catalytic cracking (FCC) unit, the order said.

Other parts of the proposed agreement would require PRSI to provide Environment Texas and Sierra Club with the following:

- A hurricane shutdown and start-up plan;

- An up-to-date list of preventive measures intended to reduce emissions from the FCC unit; and

- An electrical-grid-failure plan, which will specify the procedures Petrobras will use to safely shut down the refinery and miminise emissions during such a shutdown.

PRSI also agreed to pay penalties for any future violations of air regulations, the order said.

In a statement, PRSI said: "The settlement agreement with Environment Texas and Sierra Club is in the best interest of all parties, and will provide a direct benefit to our community. Our priorities have always been on safety, and on reliable and efficient operations that comply with the company's commitment to life programme as well as all local, state and federal regulations. Through this agreement, we commit to further improvements for the facility and its operations, both of which are part of our objectives."

In a statement, Brian Zabcik, clean-air advocate at Environment Texas, said: “Pasadena and Galena Park residents will benefit twice. Refinery upgrades will reduce illegal air pollution, while the electric vehicles project will further improve air quality.”

In a statement, Neil Carman, clean-air programme director for Sierra Club’s Lone Star Chapter, said: "We brought this suit to address the repeated mechanical breakdowns and operational flaws that have plagued the Pasadena refinery for years."

The case was filed in US District Court, Southern Texas District. The case number is 17-cv-660.

In a separate matter, the Texas Commission on Environmental Quality (TCEQ) approved fines totalling $907,000 against PRSI, the regulator said. These fines are separate and unrelated to the proposed settlement agreement.

The TCEQ said the fines were for air and water quality violations that occurred from March 2011 and December 2013.

In a statement, Petrobras said: "We have completed measures to address these matters and believe the settlement will provide a direct benefit to our community."

Petrobras is trying to sell the refinery. It has a throughput capacity of 110,000 bbl/day.

Additional reporting by Steven McGinn

By Al Greenwood