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$1M Fine Caps EPA’s 30th Refinery Suit

Thursday, March 8, 2012

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The federal government has inflicted yet another blow—its 30th, to be exact— in its ongoing effort to clamp down on U.S. refinery air emissions, fining a Kansas operation nearly $1 million and securing upgrades that will cost millions more.

The U.S. Environmental Protection Agency and Department of Justice announced the 30th settlement this week with Coffeyville Resources Refining & Marketing (CRRM), of Coffeyville, KS.

 CVR Energy Inc.

 CVR Energy Inc.

The Kansas plant has already spent more than $550 million over five years to improve its environmental footprint, a company official said.

Under a consent decree filed Tuesday (March 6) in U.S. District Court in Wichita, KS, the company agreed to pay a civil penalty of more than $970,000 and to invest more than $4.25 million on new pollution controls and $6.5 million in operating costs to resolve alleged violations of air, Superfund, and community right-to-know laws at its facility.

‘State of the Art’

Coffeyville is owned by CVR Energy Inc., of Sugarland, TX. If approved after a 30-day public comment period, the settlement will replace a 2004 consent decree that CVR entered into when it purchased the refinery out of bankruptcy from Farmland Industries Inc.

“Coffeyville Resources remains committed to operating its facilities in a manner that meets or exceeds environmental regulations,” said Robert W. Haugen, executive vice president of refining operations at CVR Energy. “During the past five years, we have invested more than $550 million in projects to streamline and modernize our operations and improve our environmental footprint at Coffeyville.

“With these latest capital commitments, our facility will reach state of the art in environmental controls and operate as an equal to any facility in the nation.”

The settlement will cost the refinery $12 million over the next five years, CVR said.

Focus on Controls, Leak Detection

The settlement will require new and upgraded pollution controls, more stringent emission limits, and more aggressive leak-detection and repair practices to reduce sulfur dioxide and nitrogen oxide emissions from refinery equipment and process units.

CRRM’s refinery has the capacity to refine more than 115,000 barrels of crude oil per day, producing gasoline, diesel fuels and propane.

According to EPA, Coffeyville made refinery modifications that increased emissions without first obtaining pre-construction permits and installing required pollution control equipment. The company also failed to notify state and local emergency responders in a timely fashion of hydrogen sulfide and sulfur dioxide releases from the refinery, EPA said.

Once fully implemented, the pollution controls required by the settlement will reduce annual nitrogen oxide emissions by about 200 tons; sulfur dioxide emissions by more than 110 tons; and emissions of volatile organic compounds (VOCs), particulate matter, carbon monoxide and other air pollutants.

The company has also agreed to perform a voluntary environmental project at the refinery valued at more than $1.2 million. The project will benefit the environment and surrounding communities by reducing emissions of VOCs and hydrogen sulfide, reducing the frequency of future acid gas flaring incidents, and saving 15 million gallons of water each year that would have come from the Verdigris River.

‘Level Playing Field’

“This settlement puts CRRM on a level playing field with the more than 100 petroleum refineries that have agreed to implement aggressive pollution control measures, thereby reducing the threats posed by harmful emissions to area residents,” said Ignacia S. Moreno, assistant attorney general.

“The agreement reaffirms our commitment to ensure that the petroleum refining industry complies with the nation’s Clean Air Act.”

Added EPA Regional Administrator Karl Brooks: "The company's pledge to promptly start and quickly complete pollution-control work supports this Agency's use of the federal environmental protection laws to cut harmful refinery pollutants.”

Refinery Program

The Coffeyville settlement is the 30th reached under EPA’s Petroleum Refinery National Initiative, which began in March 2000.

In those 12 years, the agency has reached multi-issue, multi-facility settlements with U.S. companies that refine more than 90 percent of the nation's petroleum refining capacity. The settlements cover 107 refineries in 32 states and territories. Settling companies have agreed to invest more than $6 billion in control technologies, pay civil penalties of more than $83 million, and perform supplemental environmental projects that total in excess of $75 million.

EPA says negotiations are continuing with five other refiners that represent about 5 percent of domestic refining capacity, and investigations are underway on others.


Tagged categories: Construction; Emissions; EPA; Oil and Gas; Petrochemical Plants; Regulations; VOC content

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