FOR IMMEDIATE RELEASE ENRD

TUESDAY, AUGUST 15, 2006 (202) 514-2007

WWW.USDOJ.GOV TDD (202) 514-1888

Federal Government Reaches

Settlement with Pipeline Companies
Regarding Crude Oil Spills
Pipeline Companies to Pay $2.87 Million Civil
Penalty
for Oil Spills in Kentucky and Louisiana
WASHINGTON – The federal government today reached a settlement with Mid-
Valley Pipeline Company (Mid-Valley) and pipeline operator Sunoco Pipeline L.P.
(SPLP), requiring the companies to pay a $2.57 million penalty relating to a January
2005 spill that dumped more than 260,000 gallons of crude oil into the Kentucky
and Ohio Rivers.

The complaint and consent decree also address the government’s claim under the
Clean Water Act against Mid-Valley and the pipeline operator, Sun Pipe Line
Company (Sun), for the spill of 63,000 gallons of crude oil due to pipeline corrosion
on Nov. 24, 2000, into Campit Lake in Claiborne Parish, La. The settlement requires
Mid-Valley and Sun to pay a federal civil penalty of $300,000 for that spill.

The consent decree, filed today in the U.S. District Court for the Eastern District of
Kentucky, represents the combined efforts of both the U.S. and the Commonwealth
of Kentucky, which is party to the settlement.

“Today’s agreement demonstrates the Justice Department’s on-going efforts along

with other federal and state agencies, to enforce our environmental laws,” said Sue
Ellen Wooldridge, Assistant Attorney General for the Justice Department’s
Environmental and Natural Resources Division. “The spill in the Kentucky River
was serious, and today’s settlement will ensure that the defendants are being held
responsible for their actions.”

“This settlement underscores the commitment of both the Environmental Protection

Agency and our state partners to maintain an aggressive enforcement program that
protects human health and the environment,” said Jimmy Palmer, EPA Regional
Administrator. “This joint effort shows once again that, working together, we can
achieve decisive, and very effective, results.”

Mid-Valley and SPLP will pay $1.4 million to the United States, and $1.17 million
to Kentucky in penalties for the Kentucky spill. In addition, Mid-Valley and SPLP
will perform measures to enhance future spill response preparation, and will
reimburse the Commonwealth for response costs of more than $120,000. The
defendants have already reimbursed federal response costs of at least $234,000. The
settlement also requires Mid-Valley and SPLP to donate $230,000 to a non-profit
organization dedicated to improving the environment of Kentucky.

The spill in Kentucky from the Mid-Valley Pipeline occurred on January 26, 2005,
as a result of a girth weld failure in 22-inch diameter pipe that had been laid in
1950. The oil spill harmed hundreds of migratory waterfowl. The oil slick was over
17 miles long and reached the Ohio River. The settlement resolves claims asserted
in the complaint – filed jointly with the consent decree – pursuant to the federal
Clean Water Act and the Kentucky environmental law. This settlement is in
addition to the approximately $9.5 million defendants spent on their response action
to clean up the Kentucky spill. The Clean Water Act makes it unlawful to
“discharge oil or any hazardous substances into or upon the navigable waters of the
United States [or] adjoining shorelines” and makes owners, operators, or any person
in charge of onshore oil facilities which illegally discharge oil or hazardous waste
liable for civil penalties.

The $300,000 penalty for the Louisiana spill is in addition to the $2.2 million spent
by the defendants in response costs and restoration, and to the over $26,000
reimbursed for federal response costs.

The penalty money paid to the United States for these spills will be deposited in the
federal Oil Spill Liability Trust Fund. The proposed consent decree is subject to a
30-day public comment period and court review and approval. It can be obtained on
the Justice Department Web site at
http://www.usdoj.gov/enrd/Consent_Decrees.html.

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