U.S. sues over pipeline disaster: $37 million sought from companies
By Steve Miletich

Seattle Times
31 May, 2002

Alleging gross negligence, the U.S. Justice Department filed suit against Olympic Pipe Line and Shell Pipeline yesterday, seeking up to $37.2 million in fines over the 1999 pipeline rupture in Bellingham that killed three young people.

"The gasoline spill in Washington state was a horrible but preventable tragedy that ... endangered an entire city," said Tom Sansonetti, assistant attorney general in the Justice Department's Environmental and Natural Resources Division in Washington, D.C.

"We've filed this suit to ensure that measures are taken to help prevent such an incident from ever happening again," he said.

The suit contains allegations previously outlined in civil, criminal and administrative actions brought against the companies.

It alleges the rupture stemmed from defects in the design, construction and operation of a pump station in the pipeline system, which has been linked to a pressure surge.

It also contends the companies failed to supervise construction in the mid- 1990s that weakened the pipe and didn't detect and repair the damage.

Additionally, the suit alleges that an inadequate computer system, poor training and mistakes by operators contributed to the rupture.

The suit, filed in U.S. District Court in Seattle, seeks up to $18.6 million each from Renton-based Olympic and Shell Pipeline, which previously operated under the name Equilon Pipeline, in what would be among the largest fines ever paid for a pipeline rupture.

It also seeks to impose rules on the companies to minimize future spills, including changes in management, maintenance and repair procedures.

The action was separate from a criminal indictment brought against Olympic, Equilon and three individuals in September, alleging the rupture stemmed from felony and misdemeanor violations of federal law. Trial in that case is set for January.

Yesterday's suit adds to a tangle of litigation arising from the rupture, including a wrongful-death action in which Olympic, Equilon and others agreed in April to pay $75 million to the families of two 10-year-old boys killed when the spill erupted into a huge fireball.

The family of an 18-year-old man who was overcome by fumes and drowned reached a confidential settlement without suing.

"We can't bring the boys back," said L. John Iani, regional administrator of the Environmental Protection Agency in Seattle. But the suit sends a "clear and strong message to pipeline owners and operators," he said.

Shell spokesman Cameron Smyth said the company is "committed to continuing an open dialogue" with the government in hopes of reaching a "mutually agreeable settlement."

The suit alleges Equilon, which became Shell Pipeline earlier this year in a corporate restructuring, was the manager of the 400-mile pipeline when it ruptured, spilling more than 230,000 gallons of gasoline into Whatcom and Hanna creeks in a Bellingham park.

Shell, which still owns about one-third of Olympic, maintains it only loaned officials to Olympic and didn't operate the pipeline. Olympic disputes that and is suing Equilon to recover costs.

BP Pipelines North America owns the remainder, although it didn't acquire Olympic and begin operating it until after the rupture, promising safer procedures.

BP spokesman Dan Larson said he couldn't comment on the suit.

In a deal last year, Olympic agreed to pay $10 million in state and federal penalties. Yesterday's suit preserves the federal government's right to seek up to $18.6 million from Olympic.

In addition to the three deaths, the rupture destroyed one home and killed more than 100,000 fish and other aquatic life, requiring extensive restoration work, Justice Department officials said.

The fire destroyed 2.5 miles of vegetation and killed or damaged trees within a 26-acre zone, the officials said.

Copyright c 2002 The Seattle Times Company
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