Environmental Groups and Shell Oil Company Propose Landmark Settlement of Clean Air Act Lawsuit

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Shell Would Pay $5.8 Million Civil Penalty, a Record for Citizen Enforcement Suits

Environment Texas

HOUSTON – Sierra Club and Environment Texas announced today that they have filed a proposed Consent Decree in federal court that would settle their Clean Air Act lawsuit against Shell Oil Company and two affiliates. If approved by U.S. District Judge David Hittner, the settlement would require dramatic air pollution reductions at Shell’s Deer Park, Texas, refinery and chemical plant, extensive plant upgrades, enhanced monitoring of air emissions, and a record penalty for a citizen enforcement suit.

“This settlement agreement represents a major victory in the fight for clean air on Texas’s Gulf Coast,” said Neil Carman, Clean Air Program Director for Sierra Club’s Lone Star Chapter. “We urge other oil and chemical companies in the region to take note of Shell’s willingness to work constructively with us in developing solutions to the problems at the Deer Park facility – problems that are not unique to Shell.”

“Texas families have suffered from illegal air pollution for far too long,” said Environment Texas Director Luke Metzger. “Texans couldn’t count on our state environmental agency to hold polluters accountable, so citizens had to step in to demand compliance with the law. This settlement will mean cleaner air for the Houston region and should serve as notice to other polluters playing fast and loose with our environmental laws.”

The lawsuit, originally filed in January 2008, is the first case in Texas in which citizen groups are suing to stop illegal air emissions arising from so-called “upset” events: equipment breakdowns, malfunctions, and other non-routine occurrences. The groups allege that more than a thousand separate Clean Air Act violations at the Deer Park facility since 2003 have resulted in the release of five million pounds of air pollutants, including toxic chemicals such as benzene and 1,3-butadiene.

Shell’s Deer Park facility is a 1,500-acre complex located on the Houston Ship Channel in Harris County, about 20 miles east of downtown Houston. It is the nation’s eighth-largest oil refinery and one of the world’s largest producers of petrochemicals. The facility is also the third largest stationary source of air pollution in Harris County, which ranks among the worst in the nation in several measures of air quality. Shell Oil Company is an affiliate of Royal Dutch Shell, ranked by Fortune as the third largest company in the world.

Highlights of the proposed settlement, which was hammered out in coordination with air enforcement staff at U.S. EPA, include:

  • A mandatory 80% reduction in “upset” emissions within three years (a cut of approximately 750,000 pounds per year compared to recent levels);
  • Monetary penalties for failures to meet pollution reduction benchmarks;
  • Plant upgrades to cut emissions from the most heavily used chemical plant flare, and to reduce routine flaring throughout the complex;
  • Plant upgrades to cut emissions from the Coker Unit at the refinery and from storage tanks throughout the complex;
  • Enhanced monitoring of benzene emissions.

In addition, Shell would pay a $5.8 million civil penalty for its past violations. The groups believe this is the largest penalty in an environmental citizen suit in Texas history, and nationally one of the largest ever against a single facility. The entire penalty payment will be used to fund environmental, public health and education projects in Harris County, including a project to reduce diesel emissions from school buses.

Emission reductions under the settlement would include nitrogen oxides and volatile organic compounds (VOCs), which contribute to the formation of ground-level ozone, or smog; sulfur dioxide, which contributes to respiratory illness and acid rain; and benzene and 1,3-butadiene, which are carcinogens.

The Clean Air Act’s “citizen suit” provision, which allows private citizens to enforce the Act in federal court, requires a judge to wait 45 days before signing a proposed consent decree to allow time for the U.S. EPA to review and comment on it. 

Environment Texas advocates for clean air, clean water, and preservation of Texas’s natural areas on behalf of approximately 8,000 members statewide.

Sierra Club has approximately 24,000 members in Texas who are dedicated to exploring, enjoying, and protecting Texas’ environment and natural resources.

The groups are represented by: the National Environmental Law Center; attorney David Nicholas of Newton, Massachusetts; and Houston attorney Philip Hilder.