Energy Transfer 2015 Annual Report Download - page 217

Table of Contents
applicable requirements regarding its filings for cost recovery and has not recorded any accrued liability; however, Panhandle will continue to assess its
potential exposure for such cost recoveries as the matter progresses.
Compliance Orders from the New Mexico Environmental Department
Regency received a Notice of Violation from the New Mexico Environmental Department on September 23, 2015 for allegations of violations of New
Mexico air regulations related to Jal #3. The Partnership has accrued $250,000 related to the claims and will continue to assess its potential exposure to
the allegations as the matter progresses.
Lone Star NGL Fractionators Notice of Enforcement
Lone Star NGL Fractionators received a Notice of Enforcement from the Texas Commission on Environmental Quality on August 28, 2015 for
allegations of violations of Texas air regulations related to Mont Belvieu Gas Plant. The Partnership has accrued $300,000 related to the claims and will
continue to assess its potential exposure to the allegations as the matter progresses.
Environmental Matters
Our operations are subject to extensive federal, tribal, state and local environmental and safety laws and regulations that require expenditures to ensure
compliance, including related to air emissions and wastewater discharges, at operating facilities and for remediation at current and former facilities as
well as waste disposal sites. Although we believe our operations are in substantial compliance with applicable environmental laws and regulations, risks
of additional costs and liabilities are inherent in the business of transporting, storing, gathering, treating, compressing, blending and processing natural
gas, natural gas liquids and other products. As a result, there can be no assurance that significant costs and liabilities will not be incurred. Costs of
planning, designing, constructing and operating pipelines, plants and other facilities must incorporate compliance with environmental laws and
regulations and safety standards. Failure to comply with these laws and regulations may result in the assessment of administrative, civil and criminal
penalties, the imposition of investigatory, remedial and corrective action obligations, the issuance of injunctions in affected areas and the filing of
federally authorized citizen suits. Contingent losses related to all significant known environmental matters have been accrued and/or separately
disclosed. However, we may revise accrual amounts prior to resolution of a particular contingency based on changes in facts and circumstances or
changes in the expected outcome.
Environmental exposures and liabilities are difficult to assess and estimate due to unknown factors such as the magnitude of possible contamination, the
timing and extent of remediation, the determination of our liability in proportion to other parties, improvements in cleanup technologies and the extent
to which environmental laws and regulations may change in the future. Although environmental costs may have a significant impact on the results of
operations for any single period, we believe that such costs will not have a material adverse effect on our financial position.
Based on information available at this time and reviews undertaken to identify potential exposure, we believe the amount reserved for environmental
matters is adequate to cover the potential exposure for cleanup costs.
Environmental Remediation
Our subsidiaries are responsible for environmental remediation at certain sites, including the following:
• Certain of our interstate pipelines conduct soil and groundwater remediation related to contamination from past uses of PCBs. PCB assessments are
ongoing and, in some cases, our subsidiaries could potentially be held responsible for contamination caused by other parties.
• Certain gathering and processing systems are responsible for soil and groundwater remediation related to releases of hydrocarbons.
• Currently operating Sunoco, Inc. retail sites.
• Legacy sites related to Sunoco, Inc., that are subject to environmental assessments include formerly owned terminals and other logistics assets, retail
sites that Sunoco, Inc. no longer operates, closed and/or sold refineries and other formerly owned sites.
• Sunoco, Inc. is potentially subject to joint and several liability for the costs of remediation at sites at which it has been identified as a potentially
responsible party (“PRP”). As of December 31, 2015, Sunoco, Inc. had been named as a PRP at approximately 50 identified or potentially
identifiable “Superfund” sites under federal and/or comparable state law. Sunoco, Inc. is usually one of a number of companies identified as a PRP at
a site. Sunoco, Inc. has reviewed the nature and extent of its involvement at each site and other relevant circumstances and, based upon Sunoco,
Inc.’s purported nexus to the sites, believes that its potential liability associated with such sites will not be significant.
F - 56