Source: San Antonio Express-News, April 21, 2014
Posted on: http://envfpn.advisen.com
Two recent fuel spills on the San Antonio River’s Mission Reach have put a spotlight back on a nearly 60-year-old refinery with a history of industrial accidents and disputes with regulators.
Officials of the San Antonio River Authority said last week that they would ask Calumet Specialty Products Partners of Indianapolis for cleanup reimbursement from the two jet fuel spills that ended up in the river.
SARA wants Calumet to pay for the agency’s use of emergency equipment and the hours of staff time, estimated in the thousands of dollars, in response to the spills that reached the river March 4 and April 12.
The company has said it plans to boost operations at the plant with a new pipeline carrying crude oil from the Eagle Ford Shale.
The refinery, at 7811 S. Presa St., is close to the Mission Reach, an eight-mile stretch of the river south of Lone Star Boulevard that was recently restored at a cost of more than $270 million. The river has become a magnet for recreation — hiking, biking, boating, birdwatching — and could help spur economic development on the South Side.
Mission San Juan, one of the five San Antonio missions that make up a World Heritage Site nomination, is just a mile south of the plant.
Calumet, which acquired the plant last year, is the latest owner to fail to live up to promises of being prepared for accidents, SARA General Manager Suzanne Scott told her board last week.
“When it comes time to put those procedures in place, we don’t see that high level of stewardship” expected of a refinery by a river, Scott said.
The spill in March left more than 6,500 gallons of jet fuel in a creek by the plant that feeds into the river. Calumet crews used absorbent booms and pads to contain the spill, which affected 1.5 miles of the river and temporarily closed the area to pedestrians, biking and paddling.
An official cause of the spill, linked by SARA to the death of two ducks, was not released.
On April 12, SARA officials, park police and a hazardous materials crew with the Fire Department responded to the second spill after a pedestrian reported a smell of fuel on the river. SARA officials said initial reports indicated that about 42 gallons got into the creek bed. About 30 yards of the river was affected.
SARA spokesman Steven Schauer said the spill happened the night before as crews at the plant were filling a railcar. In all, the spill totaled 1,100 gallons, but most of it was contained on the plant property.
Calumet confirmed the morning the spill was reported that some fuel had entered the creek. Under a remediation plan approved by SARA, Calumet will replace contaminated soil in the creek bed.
The Texas Commission on Environmental Quality is preparing a report on both spills.
Terry Clawson, TCEQ spokesman, said spills do not have to be reported if they occur in a building or within a containment system. But if one is outside of that boundary, it has to be reported to state and federal environmental agencies “as soon as possible but not later than 24 hours” after being discovered, Clawson said.
Plant at ‘record rates’
The company issued a statement, saying Calumet “is committed to operating in a manner that ensures plantwide compliance with environmental and regulatory guidelines.”
To prevent more spills, Calumet said it plans to install more “safety mechanisms for the railcar loading system, enhancement of containment systems in the railcar loading area and additional training” of people who load rail cars.
“Refinery personnel will be cooperating with SAFD, SARA and TCEQ to address current and future concerns and implement any corrective actions identified in that process,” the statement read.
Calumet, founded in 1919, bills itself as an independent producer of specialty hydrocarbon products, such as diesel and jet fuel, gasoline, solvents and lubricants.
Calumet officials have said a new eight-inch, 50-mile pipeline will begin transporting Eagle Ford crude from Karnes City to a terminal in Elmendorf, southeast of San Antonio, by the fall. The pipeline will provide more than 10,000 barrels daily to the San Antonio plant, improving its long-term profitability, Calumet said in November. Plans call for the refinery’s capacity to increase from the current 14,500 barrels daily to 17,500.
In a recent conference call with investors, Calumet president and COO Jennifer Straumins said the recent expansion of the plant’s crude unit allowed the refinery to run “at record rates” in January.
“We see a lot of potential upside in this refinery over time,” she said.
But the recent spills have stirred new concerns at SARA, which has clashed with past owners of the refinery for nearly 45 years.
“It seems to me that that property, that refinery is plagued,” SARA Trustee Michael Lackey said last week.
Troubles at the circa 1955 plant first surfaced about the time Earth Day was first observed April 22, 1970. SARA sued the original operator, Howell Refining, claiming the Houston company had illegally discharged oil into the river. Howell settled the lawsuit after installing a system to clean its effluent and put it in the city sewer system.
The plant, which for years provided jet fuel to area military bases, continued to make news with fires, accidents and pollution claims until AGE Refining of Dallas bought it in the 1990s. AGE owner and CEO Al Gonzalez was credited with cleaning up the site and increasing production. The company used its status as a Hispanic-owned small business to land contracts to supply jet fuel through defense contracts and to provide diesel fuel to VIA Metropolitan Transit.
But after Gonzalez handed over the reins to his family, AGE filed for Chapter 11 bankruptcy protection in early 2010. A few months later, on May 5, 2010, a tanker truck explosion and a series of other blasts at the plant left a driver badly burned and sent thick black smoke skyward. It took firefighters nearly six hours to contain the fire.
SARA ‘incensed’
In April 2011, NuStar Energy of San Antonio bought the plant out of bankruptcy. NuStar said it spent $54 million on improvements, including construction of a pipeline connecting the refinery with the terminal in Elmendorf, reducing the number of trucks rolling in and out of the plant by up to 70 per day, officials said.
Calumet acquired the plant from NuStar for $115 million in January 2013.
Aside from the recent spills, Calumet, which lists 10 refineries on its website, has had little bad publicity. Last year, the Center for Public Integrity, a nonprofit investigative news organization, reported that residents near Calumet’s Shreveport, La., refinery have complained for years about blasts shattering windows, a pungent smell and unauthorized discharges.
Susana Segura, a community organizer in San Antonio who participated in a demonstration outside the South Side plant after the March spill, said she has little faith in Calumet. The plant, with flames shooting from its flare stack to release excess hydrocarbon gases, emits a gasoline smell.
Critics of the refinery feel they’re “fighting an uphill battle” against the economic wave of hydraulic fracturing, Segura said.
“At night, you can see how bright the flame burns and you can hear it,” she said. “They shouldn’t be grandfathered, allowed to produce chemicals, next to all of this new restoration.”
SARA officials said they hope to meet this week with Calumet’s managers, fire officials and environmental regulators to discuss responses to large and small spills. When briefed last week, Lackey was the one SARA trustee who seemed vexed by the recent accidents.
“I hope you can convey in no uncertain terms to anyone that listens that this is totally unacceptable and that we’re incensed,” he said.
Scott said she would deliver that message.
“We will make sure that that is known to them, that our board’s concerns will be expressed to them. Yes, sir,” she said.