July 7, 2017
By Sam Pearson
A years-long dispute over the Chemical Safety Board’s access to ExxonMobil Corp. documents will enter a new phase at a Los Angeles federal courthouse in August, posing a test for the agency—and for corporations seeking to avoid disclosure that could prompt new regulations.
Justice Department attorneys are fighting to enforce subpoenas the CSB issued in 2015 related to an explosion at Exxon’s Torrance, Calif., refinery that injured two and put the surrounding community in danger ( United States of America v. Exxon Mobil Oil Corporation , C.D. Cal., 5/2/17 ). After asking for documents on the refinery’s hydrofluoric acid storage and emergency response operations for more than two years, the CSB published a May 3 final report detailing Exxon’s faults leading up to the blast.
CSB Chairperson Vanessa Sutherland said in a statement to Bloomberg BNA the board’s authority “clearly includes all the circumstances surrounding an incident, including potential near miss events.”
Sutherland said the oil company “has made several unsupported assertions in response to CSB’s petition, including an improper interpretation of the CSB’s statutory authority” that would force it to consider the issue of hydroflouric acid separately from the rest of the investigation.
An Exxon spokesman didn’t respond to a request for comment on the case.
The report blamed Exxon for operating the refinery’s fluid catalytic cracking unit with a critical safeguard that was not working properly and using operating procedures that let workers deviate from normal safety requirements. Exxon sold the refinery to PBF Holdings Company LLC in July 2016.
“This explosion and near miss should not have happened, and likely would not have happened, had a more robust process safety management system been in place,” Sutherland said in a statement when the report was released.
But the company has yet to comply with the subpoenas, arguing among other things that the requests are overly broad and exceed the agency’s authority. If the strategy works, other companies willing to litigate aggressively are “definitely going to view this as a smart strategy to push back as hard as possible to delay having to respond to these subpoenas,” Tracy Hester, a law professor at the University of Houston, told Bloomberg BNA.
A hearing on the case is scheduled for Aug. 29 at the U.S. District Court for the Central District of California.
Exxon lawyers contend Congress did not intend CSB “to wield its subpoena powers to conduct discretionary research into the potential for accidental releases,” the company said in a court filing June 13 in response to government attorneys.
The company also said it agreed to give CSB the documents on the condition the agency use them “for an investigation into the February incident, and not for a general hazard study,” but the board refused.
Should Exxon’s interpretation of CSB’s legal authority hold up, it could set a precedent for other companies to freeze out the agency for any information beyond establishing narrow sets of facts.
Attorneys for CSB said in a response filed June 26 Congress “did not intend to limit the Board’s investigation to the ‘cause or probable cause’ of accidental releases—as Exxon contends—but meant to also empower the Board to investigate the ‘facts, conditions and circumstances’ of those releases.”
The CSB said they would add information to their final report if they obtained Exxon’s documents, like that about the company’s use of hydrofluoric acid.
Left unanswered in the board’s report were critical questions of what would have happened had the explosion damaged an area of the refinery containing a form of hydrofluoric acid, a highly corrosive chemical that causes death or harm to skin, lungs, heart, bones and the nervous system. The chemical was featured as a method of dissolving bodies on the television show “Breaking Bad.”
The CSB found a “near miss event” occurred when debris from the explosion damaged scaffolding around the alkylation unit containing thousands of gallons of modified hydrofluoric acid. In particular, a 40-ton piece of debris flew more than 100 feet and came within five feet of hitting the structure, the agency said in a court filing.
Exxon uses what it calls modified hydrofluoric acid, which the company has used in place of hydrofluoric acid since it settled a lawsuit over the issue with the city of Torrance in 1990. While oil companies believed at the time modified hydrofluoric acid was safer, the CSB noted in court documents “few scientific studies show whether modified hydrofluoric acid is actually safer.”
Sally Hayati, the president of Torrance Refinery Action Alliance, a group of residents critical of the refinery’s management, told Bloomberg BNA the CSB could play an important role advancing public understanding of modified hydrofluoric acid. Hayati said CSB could obtain evidence to show if the modified chemical is any safer than the chemical it replaced.
The local group believes modified hydrofluoric acid is “a difference without a distinction,” Hayati said. “It gives no safety advantage.”
The CSB has published several subject-matter investigations in the past, including safety bulletins on chlorine releases, a study of combustible dust hazards, restarting facilities after Hurricane Katrina, and a nationwide review of 167 reactive hazard incidents that stemmed from one facility.
Sutherland said the CSB has no plans to conduct a study of hydroflouric acid or modified hydroflouric acid but wants “to be able to fully analyze the circumstances of the entire explosion.”
While CSB cannot propose its own regulations, companies often fear information obtained by the agency will later be used against them by other agencies, which could explain Exxon’s tough stance, Hester said.
In California, the South Coast Air Quality Management District is pursuing regulations that could phase out the use of modified hydrofluoric acid at refineries under its jurisdiction of Orange, Los Angeles, and Riverside counties and portions of San Bernardino County. Other refineries under the district’s oversight include nine others operated by Tesoro Corp., Chevron Corp., Alon USA, Phillips 66, World Oil Corp., and Valero.
CSB’s records could be “potentially subject to subpoena themselves, or information requests from other agencies,” Hester said.
California state lawmakers have also introduced legislation in the past to ban the use of hydrofluoric acid at oil refineries.
The CSB’s two-year wait for records is far longer than a previous subpoena dispute against Transocean Corp. over whether the agency could investigate the blowout that led to the Deepwater Horizon oil spill in 2010.
In that instance, the U.S. Attorney’s office in Houston sued the company about six months after the last of five subpoenas were issued to the company. The CSB won access to the records when the U.S. Court of Appeals for the Fifth Circuit ruled against Transocean in March 2015.
“From the perspective of any agency, taking this long to get a subpoena enforced is acutely problematic,” Hester said. “It undermines the credibility and authority of the agency to pursue investigation and typically with other agencies that have broader enforcement powers, the subpoena cycle would be much shorter.”
The lack of information affected the investigation, board members said at the time. At a public meeting in Torrance in January 2016, Board Member Rick Engler described the CSB as having “one hand tied behind our back, because, if you’re not complying with the subpoenas, it’s very difficult for our investigative staff to view the information and make a judgment.”
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