why doing the right thing is the right thing to do - steven g. jones 11.21.14
TRANSCRIPT
Why Doing the Right Thing
is the Right Thing to DoChevron Pipe Line Company’s Response to the Red Butte and Willard Bay Pipeline Releases
The High Cost of Non-Compliance:Risk Management and Environmental Protection Duties from the Industry Perspective
November 21, 2014
Steven G. Jones
Important Information
This presentation is similar to any other seminar designed to provide general information on pertinent legal topics. The statements made and any materials distributed as part of this presentation are provided for educational purposes only. They do not constitute legal advice nor do they necessarily reflect the views of Holland & Hart LLP or any of its attorneys other than the speakers. This presentation is not intended to create an attorney-client relationship between you and Holland & Hart LLP. If you have specific questions as to the application of the law to your activities, you should seek the advice of your legal counsel.
All Presentations and Other Materials © Holland & Hart LLP 2014
Red Butte Creek, June 11, 2010
Wind causes a “ground fault” at RMP substation
Current flows down fence post
Melted fence post
5
Ruptured pipeline
6
Chevron’s response – June 18, 2010
8
Red Butte Creek cleanup
Liberty Park/Tracy Aviary cleanup
Liberty Park pond cleanup
11
Liberty Park pond today
12
Improvements to private property
Before After
Before
After
Improvements to private property (cont’d)
Before
After
Wedding planning
Chevron’s Costs and Expenses for Red Butte
16
Expense AmountRed Butte Creek Clean-up Costs $26,642,254
Liberty Park Pond Clean-up Costs $2,293,540
Reimbursement to the University of Utah
$1,304,332
Payments to Third-Parties (Homeowners, etc.)
$832,476
Reimbursement to Salt Lake City $508,032
Waterfowl Mitigation Project $100,000
TOTAL $31,680,634
Willard Bay, April 13, 2013
Before and after pictures
Canal closest to release, adjacent to I-15
During cleanup, water was diverted tokeep incoming water clean
Same canal after cleanup
Looking east across park road
All surfaces where cleanup workers walked were covered with absorbent pads to avoid
spreading diesel
Same creek bed post-cleanup
Beach area – work was undertaken to ensure no diesel reached the bay
Beach area (cont’d)
Old sand was removed and replaced with clean sand
Beach area post-cleanup
Improvements to State Park
Park improvements (cont’d)
Deconstruction of Wetland Trail
$35,000
Weed & Trash Removal
$8,000
Fire Hydrant Replacement
$5,000
Door and Flooring Replacement
$7,000
Wood Boxes $772
Bat Boxes $3,464
Fencing $15,000
Safety guards $60,000
Fencing $40,000
Habitat rehabilitation $105,000
TOTAL $1,238,236
Mitigation over and above $21.5M in cleanup costs
Project CostWater Control Structures
$80,000
Erosion ControlCulvert Cleaning $5,000 Replanting Habitat Enhancement
$150,000
Re-sodding of Pavilion Area
$30,000
Paving $245,000 Slurry Seal $90,000 Invasive Species Removal
$10,000
Overflow Parking Lot $47,000
New Upland Trail $95,000 Trail Fence Rail $70,000 Sidewalk at Eagle Beach
$12,000
Temporary Fence $40,000 Beach Sand Enrichment $85,000
$1,238,236
The benefits of being proactive
• Red Butte– Early settlement with Salt Lake City– Early settlement with University of Utah– Early settlement with LDS Church– Structured settlement with State of Utah• Penalty• Funded mitigation projects
Benefits of being proactive (cont’d)
Willard Bay– Settled Parks Department’s lost use
damages– Structured settlement with State
• Penalty• Funded mitigation projects
Benefits of being proactive (cont’d)
Federal Penalty Negotiations– Negotiation of federal penalties deferred
until after the State negotiations were concluded and settlements funded
– As a result, Chevron received credit for both the State penalties and mitigation projects
Public response to mitigation
Willard state park reborn after spill cleanup, May 21, 2014
“All in all, [State Park Ranger James] Morgan says he was satisfied with Chevron’s response to the environmental crisis.
“I’d never throw them under the bus,” he said. “Would I want this to happen? No. But did they step up to the plate, and go above and beyond in fixing it? They did.”
Public response to mitigation
“‘It’s time to celebrate,’ said Willard Mayor Kenneth Braegger. … The proposal now green-lighted by the DWQ was formally called Willard Creek Nature Park & Debris Basin Rehabilitation Project.
‘We’ll probably rename it.’ Braegger said. ‘We’ll have to do that now that we’ve got the money. Maybe ‘Big Kiss on the Lips to Chevron Park.’”
Spill settlement mostly going to Willard Bay, May 28, 2014
Take aways
• S*** happens• If you’re in a business where it’s likely to
happen - do the right thing
Respond immediately Take responsibility Do a thorough job of cleanup Go above and beyond what’s necessary Ultimately, this makes dealing with both
regulators and the public much easier
For more information
Steven G. JonesHolland & Hart LLP
[email protected] (direct)206-356-3360 (cell)