Flare Issues Lead to another Eight Figure Clean Air Act Settlement

On February 12, 2018, the United States Department of Justice (“DOJ”) announced a proposed settlement of a Clean Air Act enforcement case against Shell Chemical, regarding Shell’s Norco, Louisiana facility.  While the proposed settlement is of a significantly lower amount than DOJ’s recent flare settlement with ExxonMobil (discussed in my November 6, 2017 Alert), the total cost to Shell is expected to exceed $10 million.

Flare Emissions at Issue
According to DOJ, the settlement will require Shell to spend approximately $10 million to install and operate air pollution control and monitoring technology to reduce harmful air pollution from four industrial flares at the Norco plant.  Shell will also pay civil penalties totaling $350,000, including $87,500 for LDEQ.

Under the settlement, Shell will take steps to minimize the amount of waste gas sent to the flares. Shell will also operate a flare gas recovery system at the facility, which will save the company money by allowing it to use waste gas as fuel; this waste gas would otherwise be sent to the facility’s flares. In addition, by installing and maintaining state-of-the-art monitoring and control technology at its flares, Shell will ensure that the flares are operated at a high combustion efficiency. Finally, Shell will install and maintain monitoring equipment to detect air pollution along the facility fence line and publish the monitoring results on a public website.

Unpermitted Modifications and Improper Operation
According to the Complaint filed by DOJ, Shell made major modifications to its equipment and processes that transported gases to its flares, without obtaining proper permits, and without going through the new source review process.  DOJ also alleged that Shell failed to operate and maintain its flares in accordance with design requirements, and in accordance with good air pollution control practice.

While Shell has generally denied the allegations, it has agreed to a settlement in the form of a proposed Consent Decree.

For a copy of DOJ’s announcement https://www.justice.gov/opa/pr/shell-chemical-lp-install-10-million-pollution-monitoring-and-control-equipment-norco
For a copy of the Complaint https://www.justice.gov/enrd/consent-decree/file/1033626/download#Complaint
For a copy of the proposed Consent Decree https://www.justice.gov/enrd/consent-decree/file/1033631/download#Consent Decree

About Crain Caton & James
Crain Caton & James provides legal counseling and client-focused solutions locally and around the world.  Our attorneys are recognized for their contributions to the legal community, their practical expertise, and their legal scholarship by contributing to standard legal texts and presenting papers and speeches to lay and legal audiences. The firm is over 105 years old and was started by a self-taught lawyer, Thomas M. Kennerly, in 1912.  Most of our clients are referrals from other clients, large organizations or other law firms.  While we began as an energy and real estate firm, practice areas have grown to also include environmental, health and safety, banking, trusts & estates, commercial litigation and mediation, fiduciary litigation, intellectual property, labor and employment, bankruptcy and corporate.


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