Delaware City Refinery to pay $218,000 in state fines
The Delaware City Refinery has agreed to pay $218,000 to settle a series of environmental violations dating back to 2014, according to state regulators.
The payments are the result of two separate settlement agreements with the Delaware Department of Natural Resources and Environmental Control.
The first deal is related to the company's illegal shipment of crude oil up the Delaware River in 2014. The second is connected to numerous illegal discharges into the state's coastal waterways from late 2014 until mid-2017.
"The Department is working to address all outstanding issues at the refinery," DNREC Secretary Shawn Garvin said in a release. "Moving forward, DNREC recognizes the importance of the Delaware City Refining Company taking steps to minimize future violations."
The settlement deals were announced just before 4:30 p.m. Tuesday. Officials with the Delaware City Refinery and its owner, New Jersey-based PBF Energy, were not immediately available for comment.
The first settlement agreement announced by DNREC resolves a legal fight between the refinery, environmentalists and state regulators that has been brewing since 2013.
The refinery at that time had just started to bring in low-cost crude oil from North Dakota and Canada by train through its new $100 million rail yard and was looking to share that new feedstock with PBF Energy's other East Coast refinery in Paulsboro, New Jersey.
Former DNREC Secretary Collin O'Mara made a controversial decision not to require that PBF Energy obtain a permit under the state's 1971 Coastal Zone Act, which bars companies from transferring new bulk products, like crude oil, across docks along Delaware's shoreline.
Instead, he only required the refinery seek an air quality permit for pollution-capturing equipment at its Delaware City pier.
The order he issued allowed the refinery to ship up to 45,000 barrels of oil a day by barge, but included a stipulation that those shipments could only go to Paulsboro. Any other destination had to be requested in advance.
But the actual air permit he issued included no such limitation, something the refinery would later seize on.
State officials first discovered in 2015 that PBF was not abiding by O'Mara's Paulsboro limitation when a whistleblower at a refinery in Philadelphia notified the Delaware Department of Justice that the Delaware City Refinery had sent at least one oil barge up the Schuylkill River.
Refinery officials admitted to that shipment but insisted for more than a year that it was a one-time event.
As detailed in a 2016 News Journal article, that assertion helped to convince O'Mara's successor David Small not to impose any sanctions against PBF Energy.
That claim later proved to be untrue.
Just days before The News Journal published its article, PBF Energy quietly informed state officials that it had actually sent 17 barges to sites outside of Paulsboro – all during a two-week period in 2014.
PBF officials and their lawyers have characterized their prior claim as "a factual misstatement" and argue the refinery never "strategically undertook to intentionally deceive DNREC."
They also maintain the refinery has the right to ship crude oil anywhere it wants because the permit issued by O'Mara contains no restrictions on final destination.
Small disagreed and issued a $150,000 fine to the refinery – the maximum allowed by law – during his final weeks in office.
The refinery appealed that fine to the Environmental Appeals Board, which was set to hear the case on Feb. 27. That hearing was canceled on Feb. 23 after DNREC and the refinery reached a deal "in principle."
Under the deal announced by Small's successor Shawn Garvin on Tuesday, the Delaware City Refinery instead will pay a $100,000 fine while admitting no wrongdoing.
The company also has agreed to seek permission from DNREC before making any future shipments beyond Paulsboro – the same requirement it ignored in 2014.
"It looks like DNREC won," said activist Amy Roe, who has long criticized the agencies handling of the refinery's permit violations.
"But I'm disappointed because this should have been handled through the public appeal process instead of some backroom deal," she said. "And this settlement does not resolve the central issue of whether the refinery can ship barges somewhere other than Paulsboro."
The Delaware City Refinery also has agreed to pay a $118,000 penalty to DNREC for repeatedly violating its National Pollutant Discharge Elimination System permits between December 2014 and August 2017.
Those permits allow the refinery to discharge treated process water, wastewater cooling water and stormwater into the Delaware River and a handful of tributaries, including Cedar Creek, Dragon Run Creek and Red Lion Creek.
Through the federal Clean Water Act, NPDES permits dictate what level of pollutants can be safely discharged, such as bacteria, heavy metals, oil and grease.
The refinery violated those permits on multiple days over three years by releasing excess suspended solids, oil and grease into state waterways and failing to appropriately sample for sulfides.
Under the terms of the settlement announced Tuesday, the refinery can either pay the full $118,000 or opt to pay $37,433 in fines and other costs and then contribute at least $88,000 toward a shoreline stabilization project at the Fort DuPont Complex near Delaware City.
DNREC states in the settlement agreement that the Fort DuPont project would mitigate erosion along the Delaware River.
It was not clear Tuesday whether DNREC had ever issued a fine for the refinery's NPDES permit violations. Typically, DNREC issues a notice of violation and then assesses a fine before negotiating a settlement.
An agency spokesman did not immediately return messages seeking comment.
The recent settlement is at least the second deal DNREC has reached with the refinery over its NPDES permits in nearly four years.
In December 2014, the agency agreed to waive a $116,000 fine for water and wastewater violations dating back to 2011 in exchange for the refinery's promise to partially upgrade its badly outdated, 300-million-gallon-per-day cooling water intake system.
That agreement also called for studies of persistent toxic chemicals in the plant's discharges, such as dioxins and polychlorinated biphenyls, along with changes to the plant's stormwater discharge scheme and attempts to re-use some wastewater to reduce freshwater withdrawals.
Environmental advocates say those promises were never kept.
"The 2014 NPDES settlement has yet to produce what was promised," Roe said. "And I'm not optimistic DNREC will hold the refinery to the terms of this settlement either."
DNREC also has not updated one of the refinery's five-year NPDES permits since it expired in 2002, the year after a deadly explosion, fire and spill at what was then the Motiva Enterprises complex. The other has been administratively extended since it expired in 2007.
The Delaware City Refinery applied for a re-issuance of those permits as a single permit that covers 33 outfalls into the Delaware River and its tributaries. DNREC has yet to act on that application.
Contact reporter Scott Goss at (302) 324-2281, sgoss@delawareonline.com or on Twitter @ScottGossDel. Contact reporter Maddy Lauria at (302) 345-0608, mlauria@delawareonline.com or on Twitter @MaddyinMilford.