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$13M Settlement Reached for 2021 Oil Spill

Posted on 10/3/2022 by Roger Marks

Three parties reached settlements to resolve alleged criminal violations of the Clean Water Act resulting from a spill of about 25,000 gallons of oil from a pipeline off the California coast last year.

An energy company and two of its subsidiaries each pleaded guilty to one misdemeanor count of negligent oil discharge into the water. The companies will pay a $7.1 million criminal penalty and serve four years on probation. In addition, the companies will reimburse the government for $5.8 million in response costs.

While serving four years probation, the companies must:

  • Improve training for employees and management,  
  • Install a new leak detection system for pipelines,
  • Visually inspect the pipeline (underwater) twice per year,
  • Notify regulators of all leak detection alarms, and
  • Make procedural modifications at a cost of about $250,000.

Lastly, the companies must contract with an oil spill response organization that is able to detect oil on the water’s surface at night or in low-light conditions.  

What Happened?

The oil spill occurred on October 1 and 2, 2021 from a pipeline that transfers crude oil from offshore facilities to a Long Beach, CA processing plant.  

Multiple leak detection alarms sounded, leading employees to shut down the pipeline.

However, employees “repeatedly and incorrectly assessed that there was no leak,” according to the Department of Justice. Because they did not recognize the leak, employees pumped more oil through the pipeline. This caused about 588 barrels of crude oil to be discharged off the coast of Huntington Beach.

The crack in the pipeline may have been caused by a vessel operator striking and dragging the pipeline with their anchor, according to Federal transportation investigators.

$13M Settlement Reached for 2021 Oil Spill

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Tags: Clean Water Act, environmental compliance, oil spill

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