PBF Energy 2013 Annual Report Download - page 37

30
appeal for lack of standing. Sierra Club and Delaware Audubon have appealed that decision to the Delaware
Superior Court, New Castle County, Case No. N13A-09-001 ALR, and Delaware City Refining and the State have
filed cross-appeals. Briefs are due to be filed in this appeal in the first quarter of 2014 but no date has been set for
a decision by the Superior Court. A hearing on the second appeal before the Environmental Appeals Board, case
no. 2013-06, was held on January 13, 2014, and the Board ruled in favor of Delaware City Refining and the State
and dismissed the appeal for lack of jurisdiction. A written decision from the Board is pending, after which the
Appellants will again have the right to appeal the decision to Superior Court. If the Appellants in one or both of
these matters ultimately prevail, the outcome may have an adverse material effect on our financial condition,
results of operations or cash flows.
Environmental clean-up and remediation costs of our sites and environmental litigation could decrease our net
cash flow, reduce our results of operations and impair our financial condition.
We are subject to liability for the investigation and clean-up of environmental contamination at each of the
properties that we own or operate and at off-site locations where we arrange for the treatment or disposal of regulated
materials. We may become involved in future litigation or other proceedings. If we were to be held responsible for
damages in any litigation or proceedings, such costs may not be covered by insurance and may be material. Historical
soil and groundwater contamination has been identified at each of our refineries. Currently remediation projects
are underway in accordance with regulatory requirements at the Paulsboro and Delaware City refineries. In
connection with the acquisitions of our refineries, the prior owners have retained certain liabilities or indemnified
us for certain liabilities, including those relating to pre-acquisition soil and groundwater conditions, and in some
instances we have assumed certain liabilities and environmental obligations, including certain remediation
obligations at the Paulsboro refinery. If the prior owners fail to satisfy their obligations for any reason, or if
significant liabilities arise in the areas in which we assumed liability, we may become responsible for remediation
expenses and other environmental liabilities, which could have a material adverse effect on our financial condition.
As a result, in addition to making capital expenditures or incurring other costs to comply with environmental laws,
we also may be liable for significant environmental litigation or for investigation and remediation costs and other
liabilities arising from the ownership or operation of these assets by prior owners, which could materially adversely
affect our financial condition, results of operations and cash flow. See “Item 7. Management’s Discussion and
Analysis of Financial Condition and Results of Operations—Contractual Obligations and Commitments” and “Item
1. Business—Environmental, Health and Safety Matters.”
We may also face liability arising from current or future claims alleging personal injury or property damage
due to exposure to chemicals or other regulated materials, such as asbestos, benzene, MTBE and petroleum
hydrocarbons, at or from our facilities. We may also face liability for personal injury, property damage, natural
resource damage or clean-up costs for the alleged migration of contamination from our properties. A significant
increase in the number or success of these claims could materially adversely affect our financial condition, results
of operations and cash flow.
Regulation of emissions of greenhouse gases could force us to incur increased capital and operating costs and
could have a material adverse effect on our results of operations and financial condition.
Both houses of Congress have actively considered legislation to reduce emissions of GHGs, such as carbon
dioxide and methane, including proposals to: (i) establish a cap and trade system, (ii) create a federal renewable
energy or “clean” energy standard requiring electric utilities to provide a certain percentage of power from such
sources, and (iii) create enhanced incentives for use of renewable energy and increased efficiency in energy supply
and use. In addition, the EPA is taking steps to regulate GHGs under the existing federal Clean Air Act, or CAA.
The EPA has already adopted regulations limiting emissions of GHGs from motor vehicles, addressing the
permitting of GHG emissions from stationary sources, and requiring the reporting of GHG emissions from specified
large GHG emission sources, including refineries. These and similar regulations could require us to incur costs to
monitor and report GHG emissions or reduce emissions of GHGs associated with our operations. In addition,
various states, individually as well as in some cases on a regional basis, have taken steps to control GHG emissions,
including adoption of GHG reporting requirements, cap and trade systems and renewable portfolio standards.