U.S. Announces $3M Settlement for Mississippi Oil Spill

June 28, 2004

The U.S. Justice Department, U.S. Environmental Protection Agency and the State of Mississippi recently announced a settlement with Genesis Energy, Inc., Genesis Crude Oil, L.P., and Genesis Pipeline USA, L.P. (Genesis) for penalties and natural resource restoration and damages.

Genesis will spend over $3 million as a result of an oil spill which discharged 336,000 gallons of crude oil near Soso, in Jones County, Miss., reaching the Leaf River and making it the largest oil spill in Mississippi since the enactment of the Oil Pollution Act of 1990.

"Maintaining the integrity of our nation's industrial infrastructure, such as oil pipelines, is a critical priority for the Justice Department. Today's action is a substantial step toward restoring the environment in the Leaf River watershed," said Tom Sansonetti, assistant attorney general of the Justice Department's Environment and Natural Resources Division.

Under the settlement lodged June 24 in the U.S. District Court for the Southern District of Mississippi, Genesis will pay a $1 million civil penalty, to be split evenly between the United States and the State of Mississippi, and perform a land acquisition and conservation supplemental environmental project within the Leaf River watershed at a cost of at least $2 million.

Discovered on December 20, 1999, the spill flowed into a tributary of the Leaf River. The settlement provides for Genesis to restore the stream bed and riparian zone of the tributary, as well as injured wetlands, and to monitor groundwater. In addition, Genesis will pay over $110,000 to federal and state natural resource agencies for natural resource damage assessment costs, oversight, and a wood duck nesting project to be completed by the United States Fish and Wildlife Service.

"We are pleased to see a settlement in this case," said Charles Chisolm, executive director of the Mississippi Department of Environmental Quality. "Our agency will continue to work with Genesis and state and federal agencies to restore and protect this valuable watershed."

The settlement resolves claims under the federal Clean Water Act and Oil Pollution Act and the Mississippi Air and Water Pollution Control Law. This settlement is in addition to the roughly $20 million Genesis spent on the removal action to clean up the spill.

In addition to this settlement, the United States has recently settled with several other pipeline companies for oil spill violations, including Colonial Pipeline Co., Olympic Pipe Line Company, and Shell Pipeline Company.

The settlement agreement is subject to a 15-day public comment period and final court approval.

Source: EPA