EPA v. Hovensa LLC

Case summary

DOJ, EPA Region 2 and EPA headquarters staff have already met with Defendant to discuss the Petroleum Refinery Initiative and terms generally agreed upon in petroleum refiner global and mini-global Consent Decrees (CDs). EPA requests the Department of Justice continue negotiations seeking penalties and injunctive relief for known and potential violations of the Clean Air Act (CAA) violations at the refinery in the Virgin Islands. In an expedited referral letter to DOJ dated September 28, 2004, EPA requested that DOJ bring a civil action against Defendant as a part of the Petroleum Refinery Initiative. Since 2004, the U.S. and the Virgin Islands have been negotiating a settlement of the PRI issues. In 2006, HOVENSA informed the governments of violations of its delayed coker unit, which is not routinely included in PRI settlements. Confirms an oral request form EPA that DOJ include settlement of the coker violations in the PRI settlement. On June 7, 2011, the U.S. District Court for the Virgin Islands entered a consent decree resolving CAA violations, primarily of PSD, NSPS, Leak Detection and Repair and Benzene Waste Operation NESHAP regulations alleged against the Defendant. Injunctive relief conducted pursuant to the CD is expected to reduce emissions of NOx and SO2. Defendant will pay the United States a civil penalty and incorporate new pollution controls that will help protect public health and the environment. Defendant will also pay the U.S. Virgin Islands, the co-plaintiff, a civil penalty and at the request of the US Virgin Islands, has agreed to put monies into an escrow account to support one or more SEPs to benefit the people of the Virgin Islands. Defendant and the Virgin Islands will jointly determine, in consultation with EPA, which project(s) to fund. In addition, Defendant will provide technical assistance and other support for the operation and maintenance of the Virgin Island Power Authority (VIWAPA) opacity, NOx and CO Continuous Emission Monitoring Systems located at the VIWAPA facilities on St. Croix and St. Thomas. Under the CD, Defendant may use contractors and/or contractor support and is not required to spend more than $500,000 in the execution of the VIWAPA project. On December 30, 2021, the Court held a hearing on the Motion to Enter, shortly after which the judge entered the CD Modification. The Modification transfers certain of HOVENSA?s obligations under the 2011 consent decree to Limetree Bay Terminals, LLC and Limetree Bay Refining, LLC (Limetree Bay). The modification includes references to updated CAA requirements and updates benzene waste and leak-detection and repair audits and operating requirements, which ensure reduced emissions from refinery equipment and process units. It also makes adjustments to account for Limetree Bay's lower operating capacity as compared to HOVENSA?s. The Modification also transfers certain obligations of the 2011 consent decree to an environmental response trust. The trust was established during HOVENSA?s bankruptcy proceedings to address Resource Conservation and Recovery Act requirements and to distribute the remaining consent decree-required escrow funds, which are now approximately $4.5 million, to be used for Territorial Supplemental Environmental Projects chosen by the Virgin Islands Department of Natural Resources, and to distribute consent decree-required funds to assist the Virgin Islands Water and Power Authority in air monitoring. A second non-material Modification makes a very minor change to the first CD Modification. Specifically, it changes the due date for the first Benzene Waste Organic NESHAP (?BWON?) audit from March 30, 2021 to November 22, 2021.

Defendants (7)

• Hovensa L.L.C.Named in complaintNamed in settlement
• Limetree Bay Terminals, LLCNamed in settlement
• Limetree Bay Refining, LLCNamed in settlement
• Environmental Response TrustNamed in settlement
• Port Hamilton Refining and Transportation LLLP
• West Indies Petroleum Refining Limited
• Transition Refinery Entity LLC

Facilities (1)

• HOVENSA L.L.C.

  1 ESTATE HOPE, CHRISTIANSTED, VI, 008205652

  Registry ID: 110071301064

Statutes cited

• CAA 165 — Prevention of Significant Deterioration (PSD)
• CAA 112 — Hazardous Air Pollutants
• CAA 173 — New Source Review Permit Requirements
• CAA 111 — New Source Performance Standards

Enforcement conclusions (3)

• Hovensa LLCentered 2021-12-30

  Primary law: CAA

• Hovensa LLC

  Primary law: CAA

• Hovensa LLC (global)entered 2011-06-06

  Primary law: CAA

  Federal penalty: $5,125,000 · State/local: $250,000

Timeline (6 milestones)

• 2004-09-28Referred To Dept Of Justice
• 2004-10-04Enforcement Action Data Entered
• 2008-03-31Supplemental Referral-Adding parties, counts
• 2011-01-26Complaint Filed With Court
• 2021-04-08Final Order Lodged
• 2021-12-30Final Order Entered