Equistar to Spend $125 Mil. on Plant Cleanup

July 19, 2007

The Justice Department (www.usdoj.gov) and the Environmental Protection Agency (EPA, www.epa.gov) announced that Equistar Chemicals (www.equistarchem.com) is required to spend more than $125 million on pollution controls and cleanup

The Justice Department (www.usdoj.gov) and the Environmental Protection Agency (EPA, www.epa.gov) announced that Equistar Chemicals (www.equistarchem.com) is required to spend more than $125 million on pollution controls and cleanup to address a myriad of air, water, and hazardous waste violations at seven petrochemical plants in Texas, Illinois, Iowa, and Louisiana.

Under terms of a consent decree lodged in federal district court in Illinois, Equistar is required to invest in comprehensive control and operational measures expected to significantly reduce air, water, and hazardous waste pollution from seven manufacturing facilities. The states of Iowa, Illinois, and Louisiana have all joined the federal government in the settlement.

“Equistar will be the first in the petrochemical industry to adopt these stricter environmental measures, many of which will go beyond what the regulations would require,” said Granta Nakayama, EPA”s assistant administrator for Enforcement and Compliance Assurance, in a prepared statement. “Through these investments in environmental compliance, Equistar has a chance to turn its performance record around and ultimately become a leader in the industry by running a cleaner, less polluting facility.”

The plants that are subject to the settlement are Equistar”s facilities in Morris, Ill.; Clinton, Iowa; Lake Charles, La. (currently inactive); Channelview, Texas; Chocolate Bayou, Texas; Corpus Christi, Texas; and La Porte, Texas.

The case was initiated as a result of inspections conducted by the EPA”s National Enforcement Investigations Center (NEIC) at Equistar”s Channelview, Texas, and Morris, Ill., facilities. During the inspections, the EPA identified extensive Clean Air Act, Resource Conservation and Recovery Act, and Clean Water Act violations.

The inspectors also found that Equistar had violated laws requiring the company to immediately report spills and releases of hazardous substances to federal and state emergency response centers. Once Equistar was notified of the violations, the company agreed to address potential compliance issues at all seven of its petrochemical plants.

According to the EPA, Equistar has already initiated action to correct the regulatory violations identified and will continue to implement enhancements to its air, water, and hazardous waste programs to address widespread deficiencies. Under the first 18 months of the settlement, Equistar is required to conduct a number of separate environmental audits of its operations to identify any additional problems, report its findings and proposed corrective measures back to the EPA and state regulators, and fix the problems.

In addition, Equistar has agreed to monitor and fix leaks of volatile organic compounds (VOCs) and hazardous air pollutants, such as benzene, from process units; to change out equipment that uses ozone-depleting substances; and to reduce flaring of VOCs. Equistar will also pay stipulated penalties under the consent decree for flaring based on the amount of pollution released to the atmosphere.

At its Channelview facility in Texas, Equistar will install a wastewater treatment system that is expected to reduce harmful air emissions by at least 26 tons per year. In addition, the company will eliminate the improper land disposal of an estimated 150,000 tons of D018 benzene-contaminated hazardous waste per year.

In addition to the pollution controls, Equistar will pay a civil penalty of $2.5 million (to be divided among the federal government and participating states), and spend $6.56 million on federal and state supplemental environmental projects. The projects include a system to capture hazardous air emissions from process vents at the Channelview, Texas, facility, and state projects that include: (1) the purchase of emergency response equipment and newer, cleaner school buses; (2) funding for the Mississippi River Tourism Center; and (3) hazardous waste cleanup activities in the wake of hurricanes Katrina and Rita.

The consent decree is subject to a 30-day comment period and final approval by the court. A copy of the consent decree is available on the Justice Department Web site at www.usdoj.gov/enrd/Consent_Decrees.html.

To report air and water violations to the EPA, visit www.epa.gov/tips.

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