FREEPORT — Gulf Chemical & Metallurgical Corp. officials said Friday the company pleaded guilty to 11 felony violations and agreed to pay a $2.75 million fine to end a criminal investigation into environmental violations at its Freeport plant.
Gulf Chemical officials made the agreement with Travis County prosecutors after the company was accused of manipulating its water releases at the site’s catalyst recycling plant to skirt environmental regulations.
Investigators took environmental records from the site’s administration building in February, eight months after a tipster called the Texas Commission on Environmental Quality claiming the company was keeping two sets of books on water quality.
“This has been embarrassing for our company, and it’s not a happy time when you have to plead guilty to felony violations of the Texas Water Code, but we do believe it was handled in the best circumstances possible,” said Gulf Chemical spokeswoman Nancy Wollam.
Travis County Assistant District Attorney Patty Robertson, whose department prosecutes environmental crimes for the commission, said the agreement was good for Brazoria County residents.
“This is helping to upgrade their plant and it’s making them stop the unlawful discharges,” Robertson said. “This is a very good outcome.”
Gulf Chemical President Dave Pacella said the company will strive to rebuild its reputation with customers and the community.
“This situation has been embarrassing for our company, and we apologize to our employees, customers and the community for the concern it has caused,” Pacella said. “This does not represent the high standards we strive to meet every day.
“By agreeing to this plea, we accept responsibility as a company for what happened in the past, and more importantly it allows us to move forward to implement measures to ensure that we are never in this position again,” he said. “We look forward to earning back the trust of all of our stakeholders.”
Gulf Chemical agreed to plead guilty to 11 felony violations of the Texas Water Code from June 2007 to January 2008, according to court documents filed Friday in Travis County. Each violation called for a fine of $250,000.
“Gulf Chemical & Metallurgical Corp. pled guilty today to intentionally discharging pollutants,” TCEQ Executive Director Mark Vickery said in a statement faxed to The Facts. “These actions are not tolerated in Texas, which is reflected by the substantial settlement amount.”
Robertson said an investigation into possible criminal violations by a person involved with Gulf Chemical is pending, but he declined to give further information.
Wollam said the company paid the fine in full Friday with a cashier’s check.
Also, Gulf Chemical agreed to upgrade the Freeport site’s wastewater treatment system to meet recommendations of an engineering consultant hired by the company in September. The majority of the work has been completed or is scheduled for completion soon.
“We moved quickly to correct the problems as soon as they were discovered,” Pacella said. “We will continue to work diligently every day to ensure our operations are safe and environmentally responsible.”
Gulf Chemical also must submit a report to the Travis County District Attorney’s Office within one year confirming that the work has been completed.
“Our natural resources belong to all of us. They are part of our common heritage as Texans,” Travis County District Attorney Rosemary Lehmberg said in a statement sent to The Facts. “Our water supplies and wildlife habitat are already under pressure, and when they are damaged or destroyed by someone’s irresponsible behavior, we all pay the price.”
THE COMPLAINT, THE FINE
The investigation began after the tipster called the TCEQ on July 6 and said she had uncovered a spreadsheet on a company computer the month before that she believed showed the company was manipulating the flow of wastewater, according to a search warrant released Feb. 5.
The employee believed the spreadsheet showed Gulf Chemical would keep samples artificially low to meet permitted quality levels.
“On days when compliance sampling was not occurring, GC would increase its flow and exceed discharge limits,” the search warrant states. “GC was not reporting the exceedances to the TCEQ.”
Gulf Chemical is allowed to return its used water to Texas waters, but only after it has been treated for certain contaminants. Industrial companies are supposed to report violations to the commission, along with plans for how they will correct the issue to prevent further problems.
Gulf Chemical began construction in April on a sulfur dioxide abatement system which will reduce stack emission by at least 95 percent and will dramatically reduce emissions of particulate matter.
“Too often companies like Gulf Chemical have brushed off smaller fines for polluting the environment, considering them just a cost of doing business,” Lehmberg said in the statement. “That’s wrong. We’re making sure the penalties for this case fit the crime.”
More than $2 million of the fine will be deposited into Travis County’s general fund, according to Lehmberg’s statement. The remainder will be earmarked for the TCEQ.
Pacella said he believed the issue has made Gulf Chemical a stronger company.
“We are fully dedicated to the service of our customers and will continue to make improvements to our operations and processes so that we remain a trusted business partner to them,” Pacella said.
Nathaniel Lukefahr covers industry for The Facts. Contact him at 979-237-0151.