Shell has agreed to pay $10 million to resolve allegations that it polluted the air around its massive new petrochemical refinery in western Pennsylvania, the administration of Gov. Josh Shapiro announced Wednesday.
Shell acknowledged that the plant, located along the Ohio River about 30 miles (48 kilometres) outside of Pittsburgh, violated air emissions limits, officials said. The multibillion-dollar facility opened in November, only to be shut down months later after the company said it identified a problem with a system that's designed to burn off unwanted gases.
Shell said it has made repairs and planned to restart the plant on Wednesday.
Under an agreement with the Pennsylvania Department of Environmental Protection, Shell Chemicals Appalachia LLC – a subsidiary of British oil and gas giant Shell plc – will pay a civil penalty of about $5 million, a portion of which will go toward environmental projects in Beaver County. The company will funnel a total of $6.2 million to the community, according to state officials.
Pennsylvania is ``taking steps to hold Shell accountable and protect Pennsylvanians' constitutional right to clean air and water while encouraging innovation and economic development in the commonwealth,'' Rich Negrin, the state's acting environmental secretary, said in a written statement.
The plant uses ethane from a vast shale gas reservoir underneath Pennsylvania and surrounding states to make polyethylene, a plastic used in everything from consumer and food packaging to tires. At full capacity, the plant is expected to produce 3.5 billion pounds (1.6 billion kilograms) of polyethylene annually. Shell had projected to spend $6 billion on the refinery, which took years to build.
Environmental advocacy groups had fought the plant and predicted that it would generate more plastic pollution, as well as compounds that form smog and planet-warming greenhouse gases. The Clean Air Council filed suit against Shell earlier this month.
Environmentalists likened the penalty announced Wednesday to a parking ticket that would have little impact on Shell's bottom line.
“The overwhelming and toxic pollution residents have been exposed to has already harmed this community - there is no price tag that will allow for this to be acceptable,'' said Andie Grey, who lives 3 miles (4.8 kilometres) from the Shell plant and is part of the Eyes on Shell watchdog group.
Grey said “there is ample evidence Shell has no desire to protect this community.''
Shell has said it is using the best available technologies to try to minimize air pollution.
“We've learned from previous issues and remain committed to protecting people and the environment, as well as being a responsible neighbour,'' Shell spokesperson Curtis Smith said Wednesday.
The plant exceeded rolling 12-month emission limits for volatile organic compounds, carbon monoxide, nitrogen oxides and other hazardous pollutants, according to state regulators. The state said Shell also violated limits on visible emissions from its flares, allowed foul odors to be released by its wastewater treatment plant and committed other violations.
Shell warned it would continue to exceed air emissions limits through the fall as the plant ramps up production. It will be required to pay additional civil penalties for any future violations.
Shell CEO Wael Sawan had cast the problems as expected “technical niggles.''
The plant's startup phase has “been slower than we would have hoped for,'' Sawan said on a conference call with analysts earlier this month. “But the team is doing a great job battling with some of the obvious technical niggles that startups typically have.''
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