West Texas Gas Companies Agree to Pay $3 Million Civil Penalty in Federal Settlement Requiring $5 Million in Safety Improvements and Clean Air Act Compliance at Eight Natural Gas Processing Plants

2 years ago

Five subsidiaries of West Texas Gas Inc. will spend up to $5 million on compliance measures in a settlement that resolves allegations in the United States’ complaint, lodged today, that they violated federal Clean Air Act chemical accident prevention requirements at several of their natural gas processing plants. The companies will pay more than $3 million in civil penalties to resolve claims stemming from fatal chemical accidents and accident prevention program violations.

In a related criminal case, another West Texas Gas subsidiary that operated a gas plant in Big Lake, Texas, – Big Lake Gas Plant L.P. – pleaded guilty to one count of negligent endangerment and one count of violating the Clean Air Act.

The settlement requires the subsidiaries to take steps to prevent chemical accidents and improve safety at eight natural gas processing plants that the companies own and operate. Seven plants are located in Texas and one is in New Mexico. The plants use a variety of chemical processes containing toxic substances and flammable hydrocarbons, such as butane, methane and propane.

“West Texas Gas’ Clean Air Act violations cost lives,” said Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division. “Today’s settlement sends a strong message to industry that the Justice Department will vigorously enforce Clean Air Act requirements that protect workers, neighboring communities and the environment by preventing dangerous chemical releases like these.”

“This company’s blatant disregard of clean air regulations had devastating real-world consequences,” said Acting U.S. Attorney Prerak Shah for the Northern District of Texas. “Our hearts go out to the family of the employee killed in the chemical incident at the plant in Big Lake. We are proud to hold the company criminally responsible, and hopeful that the safety measures stipulated in the civil settlement will protect against similar incidents.”

“The tragic deaths due to the failure by West Texas Gas to safely manage hazardous chemicals, as required by law, demonstrates the severe dangers that these violations pose to workers, nearby communities and the environment,” said Acting Assistant Administrator Larry Starfield of the Environmental Protection Agency’s (EPA) Office of Enforcement and Compliance Assurance. “Today’s settlement requires West Texas Gas to take concrete steps to prevent future accidents and will improve air quality in the vicinity of these facilities.”

The civil complaint alleges that WTG Gas Processing L.P., WTG South Permian Midstream LLC and Davis Gas Processing Inc. violated section 112(r) of the Clean Air Act and the related chemical accident prevention regulations. The EPA identified the Clean Air Act violations addressed in today’s settlement during a series of inspections of the companies’ natural gas processing plants. The EPA inspections were initiated after a catastrophic fire in November 2015 killed an employee at WTG Gas Processing, L.P.’s East Vealmoor Gas Plant in Coahoma, Texas. Thousands of pounds of flammable and toxic substances were also released into the air. Other serious fires, resulting in millions of dollars of damage, occurred at some of the companies’ other plants, and an August 2018 leak of toxic hydrogen sulfide resulted in the death of another company employee in Big Lake, Texas.

Under the settlement, the companies must hire an outside, independent engineering firm to recommend actions that the companies will complete to improve process safety at six of the eight plants. The six plants must also implement an environmental management system to improve their compliance with all federal, state and local air pollution related requirements, not just those dealing with preventing chemical accidents. The companies have elected to permanently shut down the remaining two plants. 

Section 112(r) of the Clean Air Act and the risk management program regulations contain a comprehensive set of requirements to prevent accidental releases of hazardous air pollutants, an important objective of the Clean Air Act. These regulations require owners and operators of facilities, such as natural gas processing plants, chemical plants and petroleum refineries to perform adequate and timely equipment inspections and repairs, train employees involved in the operation and maintenance of equipment, evaluate the hazards of the chemical processing equipment and ensure that operating procedures contain clear and comprehensive instructions to safely operate process equipment.

In the related criminal case against Big Lake Gas Plant L.P. arising out of the August 2018 leak, the plant admitted that it negligently released hydrogen sulfide into the ambient air. Hydrogen sulfide is a toxic gas that can compromise the human nervous system and respiratory tract and can cause life-threatening health effects if not handled properly. One employee died as a result of exposure sustained while working at the plant, and another employee was injured. The company further admitted that it knowingly failed to properly update its risk management plan following the incident, an update required by law.  

Under the terms of its plea agreement, the plant agreed to pay a $3 million fine, and acknowledged it may be ordered to pay restitution to victims, as well as the costs of supervision.  

Assistant U.S. Attorney Sean Taylor prosecuted the criminal case.

Today’s settlement is part of the Justice Department and the EPA’s ongoing efforts to protect public health and the environment by preventing industrial accidents involving hazardous chemicals. 

The settlement was lodged today in the U.S. District Court for the Northern District of Texas.  The settlement is subject to a 30-day public comment period and final court approval. 

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