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Great Lakes Article:

Murphy Oil Refinery Must Cut Sulfur Emissions

MADISON, Wisconsin, January 24, 2002 (ENS) - Murphy Oil USA "withheld information knowingly and intentionally" from the Wisconsin Department of Natural Resources when it applied for a permit to modify its refinery at Superior, Wisconsin, and that omission will cost the company at least $12 million, state and federal agencies said Wednesday.

Under the terms of a proposed settlement arising from Clean Air Act violations, Murphy Oil will pay a $5.5 million civil penalty, the largest ever leveled in Wisconsin in an environmental enforcement case. The State of Wisconsin will receive $750,000.

The U.S. Justice Department, the U.S. Attorney's office in Madison, Wisconsin, the Environmental Protection Agency and the Wisconsin Department of Justice announced that as part of the settlement, emissions of sulfur dioxide (SO2) from Murphy Oil's 35,000 barrel a day refinery will be drastically reduced.

  "As a consequence of Murphy Oil's violations, the company has been emitting SO2 from its sulfur recovery unit up to 20 times the level that would have been allowed if it had applied BACT [Best Available Control Technology] or complied with New Source Performance Standards," said U.S. Attorney Grant Johnson. "This agreement requires the company to comply with stringent pollution control standards, just as its competitors do."

Sulfur dioxide is a primary cause of acid rain, formed when the gas reacts in the atmosphere with water and oxygen to form a mild solution of sulfuric acid. Acid rain damages forests and soils, fish and other living things, materials, and human health.

Murphy Oil also will have to improve its programs to monitor and repair leaks of volatile organic compounds and prevent oil spills at the refinery, located at the western tip of Lake Superior.

As part of the deal, the company must undertake two environmentally beneficial projects at a cost of approximately $7.5 million over a five year period to further reduce SO2 emissions from other refinery process units.

In orders issued on May 18, 2001, and on August 1, 2001 after a 10 day trial, Chief United States District Judge Barbara Crabb found Murphy Oil liable for violations of Clean Air Act emission limits and permitting requirements as well as water permit, oil spill containment and waste handling requirements.

Judge Crabb ruled that Murphy Oil violated the Clean Air Act when it made major modifications at its refinery without obtaining the required Prevention of Significant Deterioration (PSD) permits, part of the EPA's New Source Review program.

When Murphy Oil obtained a PSD permit exemption from the Wisconsin Department of Natural Resources, it "withheld information knowingly and intentionally and that if it had submitted the withheld materials, they would have been material to the decision making process," the judge found.

The New Source Review program requires that an air pollution source, such as a power plant or industrial complex, install the best pollution control equipment available when it builds a new facility or when it makes a major modification that increases emissions from an existing facility. The NSR was designed to ensure that new and modified sources do not hamper progress toward cleaner air.

  "The impressive outcome of this case is the direct result of a successful, cooperative effort by State and federal officials," said Tom Sansonetti, assistant attorney general of the Justice Department's Environment and Natural Resources Division. "Companies that knowingly withhold information from regulators should be prepared to face the consequences of their misconduct," he said.

Murphy Oil officials were not immediately available for comment on the proposed settlement.

"I commend the State of Wisconsin for partnering with the federal government to bring this important case to closure, and for working to make the air cleaner for its citizens and neighboring states," said EPA Administrator Christie Whitman.

The settlement, which resolves Murphy Oil's Clean Air Act, Clean Water Act, and Resource Conservation and Recovery Act violations prior to the penalty phase of the trial now scheduled for March 2002, requires the company to install and operate a tail gas treatment unit to substantially reduce SO2 emissions from the sulfur recovery unit at the refinery;

Murphy Oil must now apply for and obtain a Prevention of Significant Deterioration permit.

The company must comply with stringent SO2 emission limitations until the Wisconsin Department of Natural Resources determines what the best available control technology is for the sulfur recovery unit.

Murphy will have to implement a comprehensive and improved refinery wide program to minimize the emission of volatile organic compounds from the refinery's pumps and valves for five years.

Oil storage tanks must be brought into compliance, including measuring containment areas and increasing their capacity, if necessary.

The consent decree only resolves Clean Air Act New Source Review violations at the sulfur recovery unit. It does not preclude the EPA or the State of Wisconsin from investigating and bringing enforcement actions for violations of New Source Review requirements at other units at the refinery, if any.

The new control technologies and programs to be implemented by Murphy Oil at its refinery will reduce emissions of sulfur dioxide and volatile organic compounds, both which can cause serious health problems for the young and elderly.

Wisconsin Attorney General Jim Doyle said, "The state continued to work closely with the federal government in the prosecution of this case. We are pleased this consent decree will significantly reduce the SO2 emissions from the refinery and improve the air quality for the citizens of Superior."

The agreement will be filed with the U.S. District Court for the Western District of Wisconsin, and is subject to a 30 day public comment period and final court approval.

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