Phillips 66 to Pay $500,000 Over Clean Air Act Violations

EPA alleges company generated invalid sulfur credits between 2006 and 2012

Published in CSP Daily News

HOUSTON -- The U.S. Environmental Protection Agency (EPA) announced that Phillips 66 Co. recently agreed to retire more than 21 billion sulfur credits that could have been used in the production of gasoline, which could potentially lead to significantly less pollution from vehicles. The company will also pay a $500,000 penalty for violations of the Clean Air Act.

Phillips 66 is an independent downstream energy company with refining, marketing, midstream and chemicals businesses operating globally. Phillips 66 Refining operations include 15 refineries with a net crude oil capacity of 2.2 million barrels per day.

In a recent administrative settlement agreement, the EPA alleged that the company generated invalid sulfur credits between 2006 and 2012. The EPA also alleged that the company failed to comply with recordkeeping, reporting, sampling and testing requirements at the Sweeny Refinery in Old Ocean, Texas, the Alliance Refinery in Belle Chasse, La., the Wood River Refinery in Roxana, Ill., the Lake Charles Refinery in Westlake, La., the Borger Refinery in Borger, Texas, and several terminals across the country.

EPA discovered these violations during facility inspections and through a review of company records, which included the results of third-party company audits required by the Clean Air Act.

The sampling, testing, recordkeeping and reporting requirements of the fuels program provide the foundation for EPA's compliance program. The EPA's fuel regulations require that all fuel produced, imported and sold in the United States must meet certain standards. Fuel that does not meet the applicable standards could lead to an increase in emissions of harmful pollutants, such as volatile organic compounds and cancer-causing air toxics.

The goal of the Clean Air Act program that regulates sulfur in gasoline is to minimize emissions from vehicles and to ensure emissions control systems function effectively. Under this program, refiners can generate credits by producing gasoline that contains less sulfur than the applicable standard, and can sell those credits to other refiners that may be unable to meet the standard.

The administrative settlement became effective in late February.

Click here for more information about this settlement.

Houston-based Phillips 66 is an energy manufacturing and logistics company with midstream, chemicals, refining, and marketing and specialties businesses. With more than 7,500 retail fuel sites, its U.S. marketing business supplies Top Tier Detergent Gasolines under the Phillips 66, 76 and Conoco brands. The Phillips 66 brand, with its shield icon, has been serving the needs of the motoring public since 1927. With its red ball, the 76 brand provides fuels that are sold at more than 1,900 retail sites on the West Coast. For nearly 100 years, the Conoco brand has been providing petroleum products to more than 2,400 retail fuel sites.