Lawsuit Filed:Tar Sands Crude by Rail Project Exposed

Update 3/6/2015: Two more groups, Rodeo Citizens Association and Safe Fuel Energy Resources of California have filed to sue Phillips 66 and the county for passing the project. Please read this article.

10:00 AM WEDNESDAY, MARCH 4, 2015; MARTINEZ, CA:  Communities for a Better Environment (CBE) sued Phillips 66 and Contra Costa County alleging illegal approvals of a tar sands refining project that could worsen pollution, climate, and refinery and rail explosion hazards, and an Environmental Impact Report (EIR) that hid the project from the public and failed to mitigate its significant environmental impacts.

Phillips 66 cannot meet its propane recovery objective without switching to a lower quality feedstock, like tar sands, and without other Phillips 66 projects to assist in that overall switch: these are critical project components that the EIR should have, but failed to, disclose to the public” said CBE Attorney Roger Lin.

The action follows the February 3, 2015 approvals for Phillips’ ‘Propane Recovery Project.’

At issue is environmental disclosure and mitigation for a switch to new oil feedstocks that cause the most extreme extraction, transport, and refining impacts of any petroleum known.

Phillips 66 told investors about its plan to switch over its California refineries to two of these oils—‘heavy crude’ from the Canadian tar sands region and shale oil transported by rail. However, the company sought approvals for the rail delivery, wharf delivery, processing, and byproduct propane handling changes needed to implement its plan via at least four separate environmental reviews. None of the reviews discloses the full scope of the plan, the planned change in crude feedstock quality, or the environmental impacts of this crude switch.

“Community and worker experts have shown it is the cheap-and-dirty oil project the CEO bragged about” said Greg Karras, CBE. “Lighting the fuse on this bomb could have significant impacts, and no one should be thinking about building it before that potential harm is disclosed and addressed” Karras said.

This Phillips 66 project is part of an industry-wide switch to new oil supplies that is  laying out across the region as Californian and Alaskan crude supplies dwindle. Other parts include the Kinder Morgan crude by rail terminal in Richmond and new and modified facilities to deliver and refine oils from new sources planned by Valero in Benicia, Wespac in Pittsburg,

Tesoro in Avon near Martinez, Shell in Martinez, and Chevron in Richmond. “Rodeo is already on toxic overload. Who can citizens turn to for representation or protection? Calls to BAAQMD and other authorities yielded no information or reported action around recent incidents of surprise late-night flaring, booming, and noxious odor emissions. The Board of Supervisors failed us without explanation in approving this tar sands expansion project. Things can only get worse and adding further risks to our health and safety is outrageous,” said Ann Puntch, Rodeo resident.

Before it was revised extensively and approved by the City of Richmond in 2014, Chevron’s 2008 EIR for its Richmond refinery ‘Hydrogen Renewal’ project was overturned by courts in 2009 and 2010, after CBE challenged that EIR for failure to disclose the change in crude feed density the project would enable, and failure to mitigate its potential climate impacts.

The Bay Area Air Quality Management District (BAAQMD) identified a need for new regional air quality policies to ensure against increased refinery emissions from changing crude feed quality since at least 2012. But despite that admission new policy requirements have languished. A February 27, 2015 comment by 25 groups including CBE called on the BAAQMD to stop oil companies from ‘gaming’ the rules by rushing oil switch projects that could commit the region to new emissions before the needed new policy is in place. In part because of such gaps in environmental protection, EIRs are required by law to disclose and mitigate all reasonably foreseeable significant impacts of proposed projects.

CCTimes article here

The complaint…

Download (PDF, 2.48MB)

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BOS hearing on Phillips 66 Propane recovery project Tuesday morning.

See the Contra Costa Times article here.

Excerpts…

MARTINEZ — After several postponements over a full year, the Contra Costa County Board of Supervisors will hold a hearing Tuesday on a propane and butane recovery project at a Rodeo petroleum refinery that has faced stiff opposition from some local residents as well as regional and national environmental groups.

The board of supervisors will meet at 9 a.m.Tuesday, in Room 107 of the County Administration Building, 651 Pine St., Martinez.

It will be one of the first items on the agenda, so it should be finished by about 10:30.

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Phillips 66 profits were $1.15 billion for last quarter of 2014

As reported by the Wall Street Journal

Phillips 66 posted better-than-expected earnings and revenue in its fourth quarter as the refinery company benefits from the flood of cheap crude oil that has sent oil prices tumbling.

As oil prices have plummeted since last summer, U.S. refiners have been sucking up as much of the abnormally inexpensive crude as they can, turning it into gasoline, diesel and other fuels. Phillips 66’s U.S. refinery margins have been buoyed by the cheap oil from places like North Dakota and Texas.

In the latest quarter, Phillips, which was spun off from ConocoPhillips in 2012, said it processed a record 375,000 barrels of tight oil a day in the quarter. About 95% of the company’s U.S. crude slate was advantaged in the quarter, unchanged from the third quarter’s record rate.

Meanwhile, total expenses fell 19.7% to $34.25 billion as the company’s crude oil and products costs fell 23%.

Overall, Phillips 66 reported a profit of $1.15 billion, or $2.05 a share, up from $826 million, or $1.37 a share, a year earlier. Excluding asset-sale gains, write-downs and other items, earnings rose to $1.63 from $1.34 a share.

Revenue fell 18.8% to $35.61 billion.

Analysts polled by Thomson Reuters expected a per-share profit of $1.37 and revenue of $35.2 billion.

While Phillips 66 had earned most of its profits from refining, its chemical production business has recently taken on a larger role.

The chemicals segment, which includes its interest in Chevron Phillips Chemical Company LLC, posted a 2.3% increase in earnings to $267 million in the latest quarter.

Earnings for the refining segment, meanwhile, grew 23.7% to $517 million.

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The CC Dept. of Conservation and Development Approves Propane Recovery Project with no new conditions.


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