Koch Industries Indicted for Environmental Crimes atRefinery

A federal grand jury returned a 97-count\r\nindictment against Koch Industries Inc., Koch Petroleum Group and\r\nfour corporate employees, charging them with environmental crimes at\r\na Texas oil refinery.

A federal grand jury in Corpus Christi, Texas returned a 97-count indictment against Koch Industries Inc., Koch Petroleum Group, and four corporate employees, charging them with environmental crimes at a Texas oil refinery.

The defendants are charged with violating federal air and hazardous waste laws at Koch Petroleum Group''s West Plant refinery near Corpus Christi.

The indictment also charges the defendants with conspiracy and making false statements to Texas environmental officials.

The West Plant is subject to Clean Air Act standards that limit emissions of benzene.

In 1977, EPA added benzene to the list of hazardous pollutants based on scientific reports strongly suggesting an increased incidence of leukemia in humans exposed to benzene.

The Clean Air Act also requires owners and operators of oil refineries like the West Plant, to submit an annual report to federal and state regulators certifying that their refineries comply with benzene regulations.

The West Plant was required to comply with the federal benzene standards by April 1994, but Koch Petroleum Group applied for and received a compliance waiver until January 1995.

The indictment alleges that in 1995, Koch Industries and Koch Petroleum Group were told by an employee that the West Plant had at least 91 metric tons of uncontrolled benzene in its liquid waste streams, some 15 times greater than the 6 metric ton limit that applied to the refinery.

"Companies that produce dangerous pollutants simply cannot focus on profit and efficiency at the expense of a community''s health," said Lois Schiffer, assistant attorney general in charge of the environment at the Justice Department. "We will continue to find and prosecute those who would flout our environmental laws."

The indictment charges Koch Industries and Koch Petroleum Group with Violating the Clean Air Act, among other things, failing to install required emissions control devices in 1995 on certain waste management units, such as its oil-water separators, wastewater sewers, and oil and wastewater tanks.

In addition, Koch Petroleum Group allegedly installed a device in January 1995 to destroy benzene fumes from two oil-water separators, the Thermatrix Thermal Oxidizer, that could not handle the high level of benzene routed to it, and it would often shut down for extended periods of time.

According to the indictment, when the Thermatrix shut down, the West Plant continued to operate and Koch Industries and Koch Petroleum Group intentionally vented large amount of untreated benzene fumes directly to the atmosphere through a bypass stack.

The benzene released through the bypass stack exceeded 10 pounds per 24-hour period on several occasions, and Koch Industries and Koch Petroleum Group did not report these releases to the National Response Center.

As a result, both were charged with violating the Comprehensive Environmental Response, Compensation and Liability Act for failing to immediately report to the National Response Center the discharges of benzene from the West Plant.

The defendants then made false and misleading statements to the Texas Natural Resource Conservation Commission to conceal the extent of the refinery''s noncompliance with the Clean Air Act, and falsely certified a report filed in 1996 that the refinery complied with the benzene regulations.

"The Texas Natural Resource Conservation Commission (TNRCC) takes very seriously its responsibility to enforce all environmental laws to protect pubic health and the environment," said TNRCC Executive Director Jeff Saitas. "We continue to work closely with state and federal task force members on this and other environmental criminal matters."

David L. Lamp of Woodlands, Texas, was plant manager of the West Plant from November 1991 until June 1994, when he was promoted to vice president of marketing of the Koch Refinery and Chemical Group. In May 1996, Lamp became vice president of Texas operations for Koch Refinery Group, which later became Koch Petroleum Group.

Lamp is charged with conspiracy to violate the Clean Air Act and conspiracy to make false statements to Texas environmental official, operating the West Plant in violation of the Clean Air Act and making false statements to Texas environmental officials.

If convicted, Lamp faces a maximum penalty of 25 years imprisonment and $1.25 million in fines.

Vincent A. Mietlicki of Andover, Kan., was an attorney in the legal department of Koch Industries Inc. and subsequently the environmental manager of the West Plant.

Mietlicki faces maximum penalties of 35 years imprisonment and $1.75 million in fines.

John C. Wadsworth of Witchita, Kan., was vice president and plant manager of the West Plant from 1994 until 1996. Wadsworth faces maximum penalties of 20 years imprisonment and $1 million in fines.

James W. Weathers Jr., of Andover, Kan., was environmental engineer from 1992 and 1996, when he became manger of the environmental department of the West Plant. He also faces maximum penalties of 20 years imprisonment and $1 million in fines if convicted.

Koch Industries and its subsidiary Koch Petroleum Group face a maximum statutory penalty of $48.5 million.

According to the indictment, Koch Industries and Koch Petroleum Group earned profits of more than $176 million in 1995, while operating the refinery in violation of the Clean Air Act.

One goal of the alleged conspiracy was to maximize profits and avoid shutting down the refinery, which did not meet environmental standards.

by Virginia Sutcliffe

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