Sunoco 2009 Annual Report Download - page 34

ITEM 3. LEGAL PROCEEDINGS
Various lawsuits and governmental proceedings arising in the ordinary course of business are pending
against the Company, as well as the lawsuits and proceedings discussed below:
Administrative Proceedings
In September 2005, Sunoco, Inc. (R&M), a wholly owned subsidiary of Sunoco, Inc., received a Finding of
Violation (“FOV”) from the U.S. Environmental Protection Agency (“EPA”), Region 5,that alleged violations of
certain requirements of the Clean Air Act (New Source Performance Standards, Hazardous Organic National
Emission Standards for Air Pollutants and Equipment Leak Detection and Repair Regulations) as a result of an
inspection at Sunoco’s Haverhill, OH chemical facility. In October 2009, the settlement of this matter in the
amount of $400 thousand was finalized. (See also the Company’s Annual Reports on Form 10-K for the fiscal
years ended December 31, 2008 and 2007.)
In June 2007, Sunoco, Inc. (R&M) received an Administrative Order of Revocation and Notice of Civil
Administrative Penalty Assessment from the New Jersey Department of Environmental Protection (“NJDEP”)
for alleged violation of certain provisions of the New Jersey Air Pollution Control Act and related regulations as
a result of failed stack tests at Sunoco’s Eagle Point refinery. In March 2009, Sunoco entered into an
administrative consent order with NJDEP, which requires Sunoco to pay NJDEP $98 thousand in a penalty
assessment and provide $295 thousand in funding for a supplemental environmental project (“SEP”). Sunoco is
currently engaged in discussions regarding the SEP. (See also the Company’s Annual Reports on Form 10-K for
the fiscal years ended December 31, 2008 and 2007.)
In August 2007, Sunoco, Inc. (R&M) received a proposed Consent Order and Agreement from the
Pennsylvania Department of Environmental Protection (“PADEP”) for remediation at a former disposal site
associated with its Marcus Hook refinery. Waste from the Marcus Hook refinery was disposed at the site prior to
1972. The site has been subject to ongoing remediation efforts to control migration of contaminated groundwater
and surface water. In January 2010, Sunoco entered into a Consent Order and Agreement with PADEP, which
requires the Company to institute corrective measures to prevent contamination of surface water bodies, conduct
a site-specific mass model study to evaluate metals loading, and conduct sampling and analysis of surface water
to determine compliance with phased-in actions levels. Sunoco also agreed to a penalty of $500 thousand, which
will be paid out over four years, and a stipulated penalty not to exceed $100 thousand per year for failure to meet
measures of success with respect to the corrective measures. (See also the Company’s Annual Reports on
Form 10-K for the fiscal years ended December 31, 2008 and 2007.)
In September 2009, PADEP issued a proposed Consent Assessment of Civil Penalty alleging
noncompliance with state and federal air regulations at Sunoco’s Marcus Hook refinery. Following negotiations
with PADEP, the matter was settled in January 2010 for a civil penalty of $173 thousand. (See also the
Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2009.)
The U. S. Occupational Safety and Health Administration (“OSHA”) announced a National Emphasis
Program under which it is inspecting domestic oil refinery locations. OSHA conducted inspections at Sunoco,
Inc. (R&M)’s Toledo refinery for a six-month period commencing in November 2007, at the Eagle Point refinery
for a six-month period commencing in June 2008 and at the Marcus Hook refinery for a six-month period
commencing in January 2009. The inspections focused on the OSHA Process Safety Management requirements.
The inspections resulted in the issuance of citations in excess of $100 thousand. In October 2009, a settlement
was reached with regard to the Toledo inspection, with Sunoco paying $270 thousand. Sunoco has formally
contested the Eagle Point and Marcus Hook citations and is in settlement negotiations with OSHA. (See also the
Company’s Quarterly Reports on Form 10-Q for the quarterly periods ended June 30, 2009 and 2008, and the
Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008.) OSHA conducted an
additional inspection at Sunoco, Inc. (R&M)’s Toledo refinery beginning in April 2009. The inspection resulted
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