Today, May 21, 2024, the Environmental Protection Agency (EPA) and Justice Department announced the filing of a felony criminal charge and related civil complaint and consent decree under the Clean Air Act (CAA) against TPC Group LLC, a Texas petrochemical company. TPC Group also entered a plea of guilty today to a one-count information charging the company with a violation of the Clean Air Act before U.S. Magistrate Judge Zack Hawthorn for the Eastern District of Texas.
The civil violations stem from TPC’s failure to take necessary measures to prevent a November 2019 explosion incident at the Port Neches facility, and its failure to carry out and implement the risk management program systems it developed for managing risk at the Port Neches and Houston facilities. Specifically, TPC was in violation of Section 112(r) of the Clean Air Act (CAA), 42 U.S.C. § 7412(r)(1) and 40 C.F.R. Part 68 (Chemical Accident Prevention Provisions).
TPC has also been criminally charged with knowingly failing to implement its own written operating procedures, including monthly flushing of production lines that would have prevented the explosion.
TPC has agreed to pay a total of $30.1 million in criminal fines and civil penalties. The civil penalty of $12,100,000 is the third largest CAA Section 112(r) settlement nationwide, following the BP Products matter in 2010 of $15,000,000 that involved four fires and explosions and the Chevron matter in 2019 of $12,492,750 that involved three release incidents. TPC will also spend approximately $80 million to complete required injunctive relief and bring its operations into compliance with CAA Section 112(r). Additionally, the criminal plea agreement includes a one-year term of probation and publishing of a public apology.
TPC is one of the largest petrochemical processing companies in North America, boasting that its crude C4 processing plants produce 35% of the butadiene in North America and that it has the largest butene-1 (“B-1”) capacity in North America.
Prior to the November 2019 explosion, TPC operated two petrochemical manufacturing facilities in Houston and Port Neches, Texas. Due to the impact on processing units, TPC discontinued its Port Neches butadiene processing operations and now uses the site a storage facility and terminal.
Under Section 112(r) of the CAA, facilities like TPC’s in Port Neches and Houston must identify hazards, design and maintain a safe facility, minimize the consequences of accidental releases that do occur, and comply with regulatory prevention measures.
On November 27, 2019, two explosions occurred at TPC’s Port Neches facility, prompting the evacuation of thousands of residents from the City of Port Neches and a mandatory evacuation of a four-mile radius of the surrounding areas. The explosions resulted in the release of 11,337,920 pounds of regulated substances, causing over $450 million in property damage to the facility, offsite property damages of over $130 million, among other damages to human health and the environment. The explosion also led to reduced usage of the Sabine-Neches Waterway, the nation’s third largest waterway by cargo volume and a major economic driver in the U.S.
TPC’s facility produced the hazardous chemical butadiene, which is used in the production of tires, latexes and plastics, and can form what is known as “popcorn polymer.” The polymer can grow at a constantly accelerating rate and cause catastrophic events, including explosions and fires. A release of butadiene is highly flammable.
EPA’s subsequent investigation of the November 2019 explosions identified violations of Section 112(r) of the CAA, 42 U.S.C. § 7412(r)(1) and 40 C.F.R. Part 68 (Chemical Accident Prevention Provisions) that caused or contributed to the explosions. TPC was aware that popcorn polymer was forming in some of its production lines, as well as the risks it posed, yet failed to take necessary measures to prevent the explosion. TPC also deviated from implementing the vital next steps included in the prevention program provisions that focus on “boots on the ground” application at both the Port Neches and Houston facilities.
EPA’s follow-up investigation of TPC’s sister facility in Houston, TX, also
revealed over 2,000 RMP violations, all of which stemmed from TPC’s inability to carry out and implement the risk management program systems it developed for managing risk.
TPC is also in violation of criminal provisions of the Clean Air Act, as it relates to knowingly failing to implement its own written operating procedures, including monthly flushing of production lines that would have prevented the explosion.
The company has agreed to pay a total of $30.1 million in criminal fines and civil penalties. The criminal fine of $18 million will be paid in full. The civil penalty of $12.1 million, which resolves the alleged violations of the Section 112(r) of CAA at TPC’s petrochemical manufacturing facilities in Port Neches and Houston will be paid through bankruptcy proceedings.
TPC is also required to perform extensive compliance injunctive relief to improve its risk management program and bring its operations into compliance with CAA Section 112(r). The injunctive relief includes updating process safety information; overhauling its process hazard analysis program; updating operating procedures; revising refresher training programs; auditing and revising emergency shutdown procedures and implementing key performance indicators; as well as a number of items specifically requested by the community, which will include the public reporting of certain information relating to incidents in a timely matter; installation and use at the fenceline and within the community of air monitors, which will have their 15-minute averaged data relayed to the public; and community safety information sharing through hosting of community meetings for providing information to the public about the facilities, including risks, evacuation routes, and how to shelter in place.
The estimated cost for the injunctive relief is approximately $80 million. As a result of this settlement, it is projected that up to 399,680,075 pounds of regulated flammable and toxic hazardous substances will be appropriately managed under the facility’s CAA 112(r) risk management program designed to prevent accidental releases to the environment.
The proposed consent decree was lodged in the U.S. District Court for the Eastern District of Texas and is subject to a 30-day public comment period and final court approval. Information on submitting comments is available on DOJ’s Proposed Consent Decree Page.
Catherine Lee
EPA Office of Civil Enforcement
U. S. Environmental Protection Agency
1200 Pennsylvania Avenue, N.W.
Mail Code 2242A
Washington, D.C. 20460
lee.catherine@epa.gov