Texas: Grand Jury Indicts Major Oil Pipeline Company

The Associated Press

CORPUS CHRISTI, Texas (AP) - A federal grand jury has indicted one of the nation's biggest oil pipeline companies for alleged air pollution crimes in Texas, even though the company disclosed the problem to regulators and fixed the problems.

The indictment charges Koch Industries Inc., its subsidiary Koch Petroleum Group and four employees with 97 felonies for problems dating to 1995 with the cancer-linked pollutant benzene at a Corpus Christi plant.

The company disclosed the problems to Texas regulators and corrected them, but the indictment alleges Koch engaged in a conspiracy and lied to Texas officials.

"Companies that produce dangerous pollutants simply cannot focus on profit and efficiency at the expense of a community's health," Assistant Attorney General Lois Schiffer said in announcing the indictment by the grand jury.

Koch spokesman Jay Rosser disputed the allegations as "not consistent with the facts."

Wichita, Kan.-based Koch said it disclosed the problems to Texas in 1995, fixed them within months, and has been in compliance on the benzene issue for more than four years.

"The government has got this one wrong," Rosser said. "The government is unjustly charging the honest, hardworking employees who discovered an issue with a new, complex regulatory requirement, investigated the issue, self-reported it to the appropriate regulatory officials, and took the steps necessary to address it."

Though Koch has been one of the GOP's most generous donors, Texas Gov. George W. Bush's administration joined in the investigation and hailed the indictment.

"The Texas Natural Resource Conservation Commission takes very seriously its responsibility to enforce all environmental laws to protect public health and the environment," commission executive director Jeff Saitas said in a press release.

Vice President Al Gore's campaign and Democrats have attacked Bush for several weeks for being easy on oil companies and not aggressively addressing air pollution in Texas - charges the Texas governor disputes.

Bush campaign spokesman Dan Barlett dismissed Gore's charge. "Governor Bush has a strong environmental compliance record which holds companies in Texas responsible for their actions," he said. "Our environmental agencies are working with Justice Department to help in any way we can to make sure Koch Industries is held accountable for their actions as well, if necessary." Gore's campaign seized on the announcement.

"George W. Bush has aided and abetted big oil and big polluters in Texas," said Gore spokesman Chris Lehane. "He took a huge amount of money from Koch industries and then allowed them to continue polluting at the expense of the people of Texas."

The indictment charges Koch with violating the Clean Air Act by among other things failing to install required emission control devices in 1995 at its Corpus Christi refinery, and using a device to destroy benzene fumes that could not handle the high levels routed to it.

The Justice Department said the anti-pollution device "would often shut down for extended periods, meaning the refinery "intentionally vented large amounts of untreated benzene fumes directly to the atmosphere."

The government also alleged the company didn't report the violations properly under rules that took effect in 1995.

Benzene is a byproduct of the oil refining process that has been linked to cancer and has been considered a hazardous air pollutant by the federal government since 1977.

The Associated Press first reported last month that the Justice Department was pursuing the indictment against Koch, a half-million-dollar donor to the GOP.

The company and executive David Koch have donated at least $215,000 to the Republican Party this election, and its employees have chipped in $27,500 to Bush's presidential bid. In addition, the company has given $225,000 in political action committee donations to GOP congressional candidates. The government first pursued a criminal investigation against Koch after a company whistleblower emerged in 1996.

A central focus of the investigation was Koch's choice of words in documents it filed with the government in early 1996 that declared the company "maintains continuous compliance" with the benzene reporting requirements of the Clean Air Act - without mentioning its earlier problems.

Koch has had previous environmental problems. Earlier this year, it settled a case involving oil leaks in six states with a record $35 million payment to the government. And it pleaded guilty in Minnesota to discharging oil into streams, paying an $8 million penalty.

The company is striving to change its image and this summer won praise for voluntarily committing to reduce ozone levels in Corpus Christi.

http://ap.tbo.com/ap/breaking/MGAVC8EGPDC.html

-- Carl Jenkins (Somewherepress@aol.com), September 29, 2000