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HollyFrontier Refining & Marketing Company LLC et al Clean Air Act Settlement

(Washington, DC – November 19, 2015) The U.S. Environmental Protection Agency (EPA) and the Department of Justice today announced a settlement with HollyFrontier Corporation subsidiaries (HollyFrontier Refining & Marketing LLC, Frontier El Dorado Refining, LLC, Holly Refining & Marketing Company-Woods Cross, LLC, and Navajo Refining Company, L.L.C.) that resolves alleged Clean Air Act violations regarding fuel quality emissions standards and testing requirements at three HollyFrontier facilities. Under a consent decree lodged today in the U.S. District Court for the District of Columbia HollyFrontier will implement a mitigation project at its refinery in Salt Lake City to offset past emissions, and pay a $1.2 million civil penalty to the United States.

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Overview of Companies

The HollyFrontier Corporation is headquartered in Dallas, Texas, and operates five refineries throughout the mid-continent, southwestern, and Rocky Mountain regions with a cumulative total processing capacity of 443,000 barrels per day. HollyFrontier Refining & Marketing LLC, Frontier El Dorado Refining LLC, Holly Refining & Marketing Company – Woods Cross LLC, and Navajo Refining Company, L.L.C (“defendants”) operate HollyFrontier Corporation’s marketing, crude and product supply, planning, human resources, and accounting functions related to HollyFrontier Corporation’s refineries.

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The settlement resolves an EPA enforcement action against the defendants for Clean Air Act violations involving their failure to comply with the Reid vapor pressure (RVP) fuel standards at several of their refineries, and their failure to comply with various fuel testing requirements at several of their refineries. The EPA discovered the alleged violations from information self-disclosed by the defendants. The fuel quality violations involve the defendants’ failure to meet RVP standards for gasoline produced at the Woods Cross (Utah), El Dorado (Kansas), and Navajo (New Mexico) refineries at various times from 2006 to 2011. 

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Pollutant Impacts

The defendants estimate that their standard violations resulted in about 10 excess tons of emissions of volatile organic compounds (VOCs), including air toxics. Air toxics – also known as “hazardous air pollutants,” or HAPs – are those pollutants known or suspected to cause cancer or other serious health or environmental effects. VOCs are one of the primary constituents of smog, which react in sunlight to form low-level ozone. Breathing ozone can trigger a variety of health problems including chest pain, coughing, throat irritation, and congestion, and can worsen bronchitis, emphysema, and asthma.

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The consent decree requires the defendants to take action to mitigate harm to human health and the environment as a result of the excess emissions caused by the violations at issue in this case. Specifically, the defendants will install slotted guide poles on two above ground fuel storage tanks at its Woods Cross Refinery in Woods Cross, Utah. The company will be required to use next generation pollutant detection technology during the implementation of the mitigation projects, and to hire a third-party to verify its compliance status for the mitigation projects. The refinery is located near an area that may present environmental justice concerns. The defendants have also represented to the EPA that they will hire a third-party auditor to evaluate compliance with the fuels regulations at five of their refineries to ensure future compliance.

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Health and Environmental Benefits

When inappropriate fuels are used in internal combustion engines, the emissions of pollutants can increase significantly and emission control equipment can be damaged. Notwithstanding improvements in vehicle emission controls, emissions from motor vehicles are a significant portion of all air pollution. The excess emissions that can be linked to the violations at issue in this case are primarily VOCs, including air toxics.

Generally, failure to test gasoline according to proper procedures and requirements are considered significant violations, because they result in (1) a reduced ability by the EPA to know whether the fuel at issue met an applicable standard, or would require substantial government resources in order to determine whether the fuel met the applicable standards; (2) a large potential for increased emissions as a result of fuel being used in an inappropriate location, time period, or vehicle type, with consequential increased emissions; and (3) a large negative overall impact on the integrity of the fuels program.

The environmental mitigation projects required by the consent decree are estimated to reduce VOC emissions, including air toxics, by about 96 tons of VOCs over the lifetime of the consent decree. Since the projects likely will remain operational after the consent decree is terminated, environmental benefits accruing as a result of these projects are anticipated to continue for many years. 

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Environmental Justice

The EPA’s environmental justice screening process did not indicate any unique or acute environmental justice concerns because the gasoline that the defendants produced was widely distributed. However, the mitigation projects are located near an area that may present environmental justice concerns.

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Civil Penalty

The defendants will pay a civil penalty of $1.2 million

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Comment Period

The proposed settlement, lodged in the U.S. District Court for the District of Columbia, a 30-day public comment period and final court approval.  Information on submitting comments is available at the Department of Justice website.

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Jeff Kodish
OECA/OCE - Air Enforcement Division
1595 Wynkoop Street (8MSU)
Denver, CO 80202-1129
(303) 312-7153

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