EPA v. CHEVRON USA, INC. (NATIONAL CASE) (NLP)

Case summary

EPA, DOJ and Mississippi Reach Settlement with Chevron U.S.A. Inc. Requiring Nationwide Safety and Chemical Accident Prevention Measures 10/24/2018 EPA, DOJ, and MDEQ announced a national settlement with Chevron U.S.A. Inc. that requires safety improvements at all its domestic refineries. This resolves claims that the company violated provisions of the CAA aimed at preventing accidental releases of hazardous chemicals that can have serious consequences for public health and the environment. As part of the proposed settlement, Chevron will spend approx $150 million to replace vulnerable pipes, institute operating parameters and alarms for safer operation, improve corrosion inspections and training, centralize safety authority within the corporation, conduct a pilot study of safety controls for fired heaters, and make other safety improvements at all its domestic refineries. Chevron also will pay a $2.95 civil penalty and will implement supplemental environmental projects worth at least $10 million in the communities surrounding the refineries in CA, MS, UT, AND HI. The overall value of this settlement exceeds $160 million, which makes it the largest settlement in the history of the EPAs enforcement of the RMP Rule under CAA 112r. EPA?s initial investigation was spurred by an Aug 6, 2012 fire involving high-temperature hydrocarbons released in the Crude Unit at Chevron?s Richmond, CA refinery. That fire prompted a shelter-in-place order by Contra Costa County officials, endangered 19 employees, and caused 15,000 local residents to seek medical attention. During EPA?s investigation, Chevron experienced accidental releases of regulated chemicals at two of its other refineries, including a 2013 explosion and fire in Pascagoula, MS that caused the death of employee Tonya Graddy, and a 2013 rupture in El Segundo, CA that caused a loss of power and flaring at the refinery. The Complaint, filed concurrently with the proposed settlement today in the US District Court for the ND of CA, alleges violations of CAA Section 112(r), which requires covered facilities to implement a systematic RMP to prevent accidental releases of dangerous substances, and to meet a general duty of care in designing and maintaining safe facilities. The MS Dept of Environmental Quality participated as co-plaintiff, exercising its concurrent authority to enforce the RM Program regulations over Chevron?s Pascagoula refinery. This is the first case in which the US and a state have jointly brought suit to enforce these provisions. The proposed settlement also resolves claims under CERCLA and EPCRA regarding delayed reporting of an Aug 2, 2012, hydrogen sulfide release from Chevron?s Richmond facility. The Supplemental Environmental Projects that Chevron has agreed to perform, valued at $10 million, will supply emergency response equipment to local jurisdictions surrounding the five subject refineries. Chevron U.S.A. Inc. is the subsidiary of Chevron Corp that owns and operates the corporation?s U.S. petroleum refineries. Chevron Corp is the second-largest integrated energy company in the U.S., and Chevron U.S.A. Inc. is the 6th-largest U.S. refiner as measured by crude oil distillation capacity. The proposed settlement covers all 4 Chevron U.S.A. Inc. refineries, located in Richmond and El Segundo, CA; Pascagoula, MS; and Salt Lake City, UT; as well as a 5th refinery formerly owned and operated by Chevron, Kapolei, HI. The Richmond component of the settlement builds on the relief achieved by previous state enforcement actions, including a 2013 criminal settlement with the California Atty General?s Office and the District Attorney for Contra Costa County, and a 2017 settlement with the CA Dept of Industrial Relations, Occupational Safety and Health Div. The proposed CD was lodged today in the U.S. District Court for the ND of California and is subject to a 30-day public comment period and final court approval.

Defendants (1)

• CHEVRON USA, INC.Named in complaintNamed in settlement

Facilities (6)

• CHEVRON USA INC, CHEVRON PRODUCTS COMPANY, PASCAGOULA REFINERY

  250 INDUSTRIAL ROAD, PASCAGOULA, MS, 39581

  Registry ID: 110000377477

• CHEVRON USA INC, CHEVRON PRODUCTS COMPANY, PASCAGOULA REFINERY

  250 INDUSTRIAL ROAD, PASCAGOULA, MS, 39581

  Registry ID: 110000377477

• CHEVRON USA INC, CHEVRON PRODUCTS COMPANY, PASCAGOULA REFINERY

  250 INDUSTRIAL ROAD, PASCAGOULA, MS, 39581

  Registry ID: 110000377477

• CHEVRON USA INC, CHEVRON PRODUCTS COMPANY, PASCAGOULA REFINERY

  250 INDUSTRIAL ROAD, PASCAGOULA, MS, 39581

  Registry ID: 110000377477

• CHEVRON USA INC, CHEVRON PRODUCTS COMPANY, PASCAGOULA REFINERY

  250 INDUSTRIAL ROAD, PASCAGOULA, MS, 39581

  Registry ID: 110000377477

• CHEVRON USA INC, CHEVRON PRODUCTS COMPANY, PASCAGOULA REFINERY

  250 INDUSTRIAL ROAD, PASCAGOULA, MS, 39581

  Registry ID: 110000377477

Statutes cited

• CAA 112[R][7] — Prevention of Accidental Release/Risk Management Plans (RMPs)
• CAA 112[R][1] — Prevention of Accidental Release/General Duty Clause

Enforcement conclusions (1)

• CHEVRON USA, INC. (NATIONAL CASE) (NLP)entered 2019-03-07

  Primary law: CAA

  Federal penalty: $457,250 · State/local: $457,250 · SEP: $3,100,165

Timeline (5 milestones)

• 2016-09-29Referred To Dept Of Justice
• 2016-09-30Enforcement Action Data Entered
• 2018-10-24Complaint Filed With Court
• 2018-10-24Final Order Lodged
• 2019-03-07Final Order Entered