Exxon faces stiff penalty for Arkansas spill

Nov. 7, 2013 at 7:23 AM

WASHINGTON, Nov. 7 (UPI) -- Exxon Mobil Corp. faces nearly $2.7 million in fines for a violations tied to a March oil spill from its Pegasus pipeline in Arkansas, federal regulators said.

The Pipeline and Hazardous Materials Safety Administration issued an 18-page statement Wednesday to Gary Pruessing, president of Exxon Mobil Pipeline Co., listing nine likely violations of safety rules associated with the Pegasus pipeline.

The PHMSA said Exxon may face a civil penalty of $2.65 million.

About 5,000 barrels of a diluted form of heavy Canadian crude oil spilled from a 22-foot rupture in the pipeline in Mayflower, Ark. A 243-page report published by the PHMSA in August said it was "highly probable" small cracks occurred when the original pipe was built in the 1940s. These cracks then would have spread and merged to form larger faults, which may have contributed to the rupture.

The PHMSA said the company failed to consider all risk factors associated with the pipeline. It said the issues likely stemmed from a manufacturing defect.

U.S. Sen. Mark Pryor, D-Ark., praised the PHMSA findings.

"Exxon Mobil has caused undue harm to Arkansas families, and they must be held accountable," he said.

Exxon has 30 days to contest the decision.

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