The United States Clean Air Act is a federal law that regulates various business practices, including certain chemical releases for oil and gas companies. Business owners who operate in this industry likely know that allegations of a violation are serious, but just how serious? A recent case provides an example.
Feds demand millions in fines after allegations of an environmental regulation violation
The case involves an oil and gas company that operates in West Texas. It all began after a large fire in one of their plants in 2015 led to a federal investigation. The investigators found the fire resulted in the release of toxic substances into the air surrounding the plant.
The United States Department of Justice (DOJ) claims the release was the result of West Texas Gas Inc.’s violation of the Clean Air Act because it did not conduct sufficient accident prevention measures. These measures can include equipment inspections, employee training and use of clear instructions on operating procedures.
A spokesperson for the Environmental Protection Agency (EPA) stated the company was responsible for additional violations when it failed to update its risk management plan after the fire.
When faced with the allegations, the business chose to accept a plea deal. In exchange, they will pay a $3 million fine and additional restitution to victims who were injured and the family of a worker who was killed in the accident. The organization will also put an additional $5 million investment into compliance measures.
Lessons for other oil and gas companies
The feds take allegations of a Clean Air Act violation seriously — and the expense can be crippling to business operations. Businesses that operate in this market are wise to conduct regular internal audits and make changes as needed to better ensure compliance.