Attorney General Files Criminal Charges Against XTO Energy Drilling Company
The Attorney General's Office Tuesday announced charges against a Pennsylvania subsidiary of ExxonMobil for illegally discharging more than 50,000 gallons of toxic wastewater from a Marcellus Shale gas well site in Penn Township, Lycoming County.
Attorney General Kathleen G. Kane identified the company as XTO Energy Inc., 395 Airport Road, Indiana, Pa. Evidence and testimony was presented to a statewide investigating grand jury, which recommended the criminal charges being filed.
XTO owns the Marquardt well site in Penn Township, which contains two natural gas wells on the site. During natural gas extraction, these wells produce waste water containing toxic substances, such as chlorides, barium, strontium and aluminum. XTO allegedly stored this waste water in 21,000-gallon storage tanks at the Marquardt site for subsequent processing.
The grand jury found that XTO hired a company to recycle waste water at the Marquardt site from Nov. 4, 2010 through Nov. 11, 2010. After that one-week period, XTO directed that company to remove their processing equipment from the site and transport it to another XTO well site in West Virginia.
However, XTO allegedly continued to transport and store gas well waste water at the Marquardt site despite not having the proper equipment on site to safely store or process it.
The illegal discharge of gas well waste water was discovered on Nov. 16, 2010, when an inspector with the Department of Environmental Protection made an unannounced visit to the Marquardt site.
According to the grand jury, during that visit a DEP inspector discovered that a rear discharge valve on a storage tank had been opened and a drain plug had been removed, causing gas well waste water to flow out of the storage tank onto the ground. There also was evidence of prior waste water discharges from other storage tanks at the Marquardt site.
The grand jury found that between November 12-16, 2010 more than 93,000 gallons of waste water was transported to and stored at the Marquardt site, of which approximately 57,000 gallons was unaccounted for following the spill.
Kane said that the toxic waste water flowed into and polluted an unnamed tributary of Sugar Run. As a result of the spill, DEP required more than 3,000 tons of contaminated soil to be excavated and removed from the Marquardt site
XTO allegedly failed to place a spill containment system under any of the storage tanks at the Marquardt site; failed to lock or otherwise secure any of the storage tanks on site; and failed to utilize any security measures to prevent unauthorized individuals from accessing the Marquardt site.
According to the grand jury, XTO did not have a permit to discharge wastewater at the Marquardt site and failed to report any waste water spills to DEP as required by law.
XTO Energy Inc. is charged with five counts of unlawful conduct under the Clean Streams Law and three counts of unlawful conduct under the Solid Waste Management Act.
Kane thanked the Department of Environmental Protection for their assistance with the investigation.
The case will be prosecuted in Lycoming County by Chief Deputy Glenn A. Parno of the Attorney General's Environmental Crimes Section.
XTO Energy Inc., a subsidiary of Exxon Mobil Corporation, said today it will
challenge criminal charges filed by Pennsylvania’s Attorney General, Kathleen Kane, regarding a November 2010 spill of produced water from a temporary storage tank being used during a water recycling operation in Lycoming County.
Criminal charges are unwarranted and legally baseless because neither XTO nor any of its employees intentionally, recklessly or negligently discharged produced water on the site.
XTO acted quickly and cooperatively with state and federal authorities to clean up the produced water.
There was no lasting environmental impact and the site has been fully remediated in accordance with guidance of Pennsylvania’s Department of Environmental Protection.
The criminal charges filed by the Attorney General are unprecedented and an abuse of prosecutorial discretion. There was no intentional, reckless, or negligent misconduct by XTO. The incident did not result in significant or lasting environmental harm.
Charging XTO under these circumstances could discourage good environmental practices, such as recycling. The action tells oil and gas operators that setting up infrastructure to recycle produced water exposes them to the risk of significant legal and financial penalties should a small release occur.
XTO has already agreed with federal authorities on reasonable civil penalties and preventative steps to avoid future accidents of this type. Without admission of liability, on July 18, 2013, a consent decree regarding the discharge was signed between XTO and the U.S. Department of Justice and the U.S. Environmental Protection Agency.
The Department of Justice conducted a full investigation for more than a year and concluded that criminal charges were not warranted. An investigation by the Pennsylvania Department of Environmental Protection is ongoing.
The PA Chamber of Business and Industry said it is deeply concerned by Pennsylvania Attorney General Kathleen Kane’s decision to file criminal charges against a company operating in the Commonwealth for what by all accounts was an unintentional action caused by a contractor.
Kane’s charges against XTO Energy, Inc. stem from a November 2010 spill of produced water from a temporary storage tank being used during a water recycling operation in Lycoming County.
PA Chamber President and CEO Gene Barr said it is puzzling that this action is being taken given that XTO worked voluntarily with state and federal authorities to clean up the produced water, and the site has since been fully remediated; and especially given that both the U.S. Department of Justice and the U.S. EPA found no reason to impose criminal sanctions.
“This decision sends a chilling message to all businesses looking to locate in Pennsylvania that they could be held criminally liable in the event of an unintentional spill by a contractor that resulted in no injury to humans or wildlife and that had no lasting impacts on the environment,” Barr said. “It’s an unusual, if not unprecedented, over-reach by the attorney general.”
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