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Environment & Science

Spill at Tesoro's Wilmington refinery may put the oil company on the hook for half a million dollars

A groundwater leak at the Tesoro Refinery in Wilmington could yield a significant penalty for the independent oil producer.
A groundwater leak at the Tesoro Refinery in Wilmington could yield a significant penalty for the independent oil producer.

The Wilmington refinery owned by the independent refiner Tesoro may pay a fine of several hundred thousand dollars to the Los Angeles Regional Water Quality Control Board for spilling a component of petroleum from a leaky above-ground storage tank. It's just one incident, but it's worth a look because of the size of the proposed settlement penalty--a little under half-a-million dollars. (That's pretty big for an incident where there wasn't an explosion or an injury.)

The Control Board announced the proposed settlement for civil liability Tuesday. The idea is that, going forward, "we will be monitoring the groundwater to make certain that the cleanup is completed," Control Board officer Sam Unger said in a press release. "If the settlement is approved, the $440,670 fine will be deposited into the State Water Board’s Cleanup and Abatement Account."

State and federal regulators have been cracking down, over the past five years or so, on above-ground storage tanks. In this case, Tesoro spilled naphtha, which is toxic and considered hazardous in the workplace by the Occupational Safety and Health Administration. It's flammable, it's an eye irritant, and it can affect the central nervous system. According to the regional water board's tentative order, it "can be harmful or fatal if swallowed and contains benzene, which can cause blood disease, including anemia and leukemia."

By the terms of the order, Tesoro mostly recovered this mess. The company says its workers recovered 530,251 gallons, which according to the civil liability order "is more than 50% of the spilled amount of approximately 638,400 gallons. 

The Wilmington refinery is Tesoro's second-largest. It's been in the news lately because the company's been bargaining with the United Steelworkers union at all six of its refineries, and they just locked down a contract in Wilmington. (The Golden Eagle plant in Wilmington seems to be still negotiating.)

One reason workers may be bargaining so hard is safety. Not long after the naphtha spill in Wilmington, five workers died in a fire that started in the naphtha unit of Tesoro's 120,000-barrel-a-day Anacortes refinery in Washington. That event and others were eventually investigated by the Center for Public Integrity, which wrote that "problems quietly fester at the factories that refine the nation’s fuels — labyrinthine complexes full of hazardous chemicals that are plagued by often-preventable accidents, putting workers at risk and endangering nearby communities." 

The staff of the regional water board is accepting public comment on the issue through the end of June. If nobody objects, and the board members approve it, Tesoro could be writing the check this summer.