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Plant Settlement to Cost Shell $115M+

Friday, July 12, 2013

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Shell Oil will spend nearly $120 million for facility upgrades and fines to settle federal litigation involving pollution at its Houston-area refinery and chemical plant.

Under a federal settlement agreement announced Wednesday (July 10), the oil giant will pay $2.6 million in civil penalties, $1 million for a benzene monitoring system, and more than $115 million for technology to control air pollution from industrial flares and other processes, the U.S. Justice Department and Environmental Protection Agency announced.

Consent Decree

A 250-page consent decree filed in U.S. District Court for the Southern District of Texas details a variety of steps that Shell must take to improve its flaring operations and other processes. Industrial flares are used to burn waste gases.

Shell Deer Park
Shell Oil

Shell processes about 330,000 barrels per day of crude oil at the Deer Park facility, making it the 11th largest refinery in the United States.

The decree includes a requirement that Shell recover and recycle waste gases from its chemical plant—the such agreement of its kind, federal authorities said.

Houston-based Shell processes about 330,000 barrels per day of crude oil at the Deer Park facility, making it the 11th largest refinery in the United States. The Deer Park chemical plant produces about 8,000 tons of ethylene, benzene, toluene, xylene, phenol, acetone and other products.

Both the chemical plant and the refinery operate 24 hours a day, 365 days a year.

Settlement Terms

In a complaint filed at the same time as the settlement, the federal government accuses Shell of violating Clean Air Act emissions requirements at 12 steam-assisted flaring devices.

Under the agreement, Shell will spend $100 million on new technology to reduce the air pollution from its flaring operations. The agreement requires the company to:

  • Recover and recycle the waste gases, which Shell may then reuse in fuel or other products;
  • Comply with limits on how much waste gas can be burned in a flare (flare caps); and
  • Install and operate instruments and monitoring systems to ensure that gases sent to flares are burned with 98% efficiency.
Shell Deer Park
Shell Oil

The oil company will spend between $115 million and $160 million for upgrades at the refinery and chemical plant near Houston.

Shell must also:

  • "Significantly modify" its wastewater treatment plant;
  • Replace and repair tanks as necessary;
  • Inspect tanks biweekly with an infrared camera to better identify potential integrity problems that may lead to leaks; and
  • Implement enhanced monitoring and repair practices at the benzene production unit.

That list of projects are expected to cost between $15 million and $60 million.

And  in a second project to benefit the community, Shell has agreed to spend $200,000 on retrofit technology to reduce diesel emissions from government-owned vehicles used near the Deer Park complex.

Reducing HAPs

Once fully implemented, the mandated pollution controls will eliminate at least 4,550 tons of emissions by hazardous air pollutants each year. The pollutants include sulfur dioxide and volatile organic compounds (VOCs), including benzene.

The controls will also reduce emissions of greenhouse gases by about 260,000 tons per year, the agencies said.

Focus on Flares

EPA assistant administrator Cynthia Giles said the settlement was "part of EPA’s nationwide enforcement effort to protect fenceline neighborhoods by significantly reducing toxic pollution from flares and making information about pollution quickly available to affected communities.”

EPA is trying to reduce the amount of waste gas sent to flares and to improve flare operations in order to reduce toxic emissions.

Shell Deer Park
justiceinnigerianow.org
Criticized over its flaring practices in the Niger Delta, Shell has reduced flaring there.

Officials say such emissions pose a significant threat to public health. Exposure to high concentrations of sulfur dioxide can affect breathing and aggravate respiratory and cardiovascular disease; VOCs are a key component in smog, which causes respiratory illnesses; and benzene is a carcinogen.

Shell has faced criticism in other regions of the world, including Africa, for its flaring practices. The company says it has reduced flaring in the Niger Delta.

"Improper operation of an industrial flare can send hundreds of tons of hazardous air pollutants into the air," authorities said in a statement. "EPA wants companies to flare less, and when they do flare, to fully burn the harmful chemicals found in the waste gas."

The consent decree is subject to a 30-day public comment period and court approval.

   

Tagged categories: Chemical Plants; Enforcement; Facility Managers; Oil and Gas; Petrochemical Plants; Tanks and vessels

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