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STATE OF INDIANA    )        BEFORE THE INDIANA DEPARTMENT OF
                ) SS:        ENVIRONMENTAL MANAGEMENT
COUNTY OF MARION    )

COMMISSIONER OF THE DEPARTMENT    )
OF ENVIRONMENTAL MANAGEMENT,    )
                            )
            Complainant,        )
                            )    
                v.            )    CAUSE NO.     B-2161
                            )
                            )
GULL OIL, INC.,             )
                        )
            Respondent.         )

AGREED ORDER

    The Complainant and the Respondent desire to settle and compromise this action without hearing or adjudication of any issue of fact or law, and consent to the entry of the following Findings of Fact and Order.

I. FINDINGS OF FACT

    1.    Complainant is the Commissioner (hereinafter referred to as "Complainant") of the Indiana Department of Environmental Management ("IDEM"), a department of the State of Indiana created by IC 13-13-1-1.

          Respondent is Gull Oil, Inc., which owns and operates an oil production operation (hereinafter referred to as the "Site") located on Second Creek Road near Francisco, Indiana in Gibson County, Indiana.
    
    3.    The IDEM has jurisdiction over the parties and subject matter of this action.
    

    4.    Pursuant to IC 13-30-3-3, IDEM issued a Notice of Violation via Certified Mail on August 3, 1998, to:

                Mr. Larry D. Gullett, President and Registered Agent
                Gull Oil, Inc.
                Rural Route 1, Box 2A
                Francisco, Indiana 47649

    5.    Designated representatives of the Indiana Department of Natural Resources (IDNR) and the Indiana Department of Environmental Management (IDEM) conducted inspections of Respondent's oil well production operation Site on May 5, 1997, May 6, 1997, May 9, 1997, May 12, 1997, and May 23, 1997. Based on the inspections and a record review, IDEM contends that Respondent has been found in violation of the Indiana Code (IC) and the Indiana Administrative Code (IAC).

    6.    327 IAC 2-6.1-4 contains the following definitions:

        (15)    "Spill" means any unexpected, unintended, abnormal, or unapproved dumping, leakage, drainage, seepage, discharge or other loss of petroleum, hazardous substances, extremely hazardous substances, or objectionable substances.

        (16)    "Spill response"for purposes of this rule means the following:
             (A) the spill is contained; and
             (B) free material is removed

        (17)    "Spill report" means an oral report that includes .... the location and time of the spill; the identification of the substance spilled, the quantity of substance that has been or may further be spilled, the identification of the person making the spill report, and what measures have been or will be undertaken to perform a spill response and any other information that may be significant to the response action.

    7.    327 IAC 2-6.1-7, requires, in part, that any person who operates, controls or maintains any mode of transportation or facility from which a spill occurs shall, upon discovery of a reportable spill to the waters of the state, do the following:

        (1) Contain the spill, if possible, to prevent additional spilled material from entering the waters of the state.


        (2) Undertake or cause others to undertake activities needed to accomplish a spill response.

        (3) As soon as possible but within two (2) hours of discovery, communicate a spill report to the Department of Environmental Management, Office of Environmental Response: Area code 1-888-233-7745 for in state calls (toll free).

    8.    On Sunday, May 4, 1997, the IDEM Office of Environmental Response was informed by the Indiana Department of Natural Resources (IDNR) that there was a spill of approximately 20 barrels of crude oil and approximately 4200 gallons of brine water. Respondent contends that approximately 12 barrels of oil and 4200 gallons of brine water were spilled and that approximately 6 barrels of oil were recovered from the fire wall area. A portion of the spilled oil and most of the brine entered a ditch which is a tributary to the Patoka River in Gibson County. The incident occurred sometime on Friday, May 2, 1997, as the result of high wind breaking a flow line on a oil collection tank. Gull Oil noticed the release on Saturday, May 3, 1997. A local citizen had asked IDNR to investigate the source of oil in a local ditch.

    9.    IDNR made an on-site visit on Monday, May 5, 1997, and observed that Respondent placed 5 absorbant booms in the ditch and that straw had been used on May 3, 1997, to soak up some of the oil. IDEM Environmental Response staff conducted a field response on Tuesday, May 6, 1997. Photos were taken of oil on approximately 2 miles of ditch. IDEM contends that Respondent's failure to report the release, contain, and immediately clean-up the spill constitute violations of 327 IAC 2-6.1-7.

    10.    Another inspection at the spill site was conducted on May 9, 1997, by the IDNR. Absorbant booms had been deployed, oil soaked straw had been picked up, and log jams on the waterway had been removed. Respondent was to cut oil stained grass on the ditch banks and bag the clippings.

    11.    IDEM staff returned to the site on May 12, 1997, to observe clean-up activities. On May 23, 1997, IDEM staff observed that Respondent was finishing the clean- up. Therefore, the completion of the clean-up was May 23, 1997. The President of Gull Oil, Inc. worked with his family and a crew of 6 during the period of clean-up activities and has spent over $7,000 in efforts to contain the spill and clean up the site.

    12.    327 IAC 2-1-6(a)(1) states, in substance, that all waters at all times and at all places, including the mixing zone, shall meet the minimum conditions of being free from substances, materials, floating debris, oil or scum attibutable to municipal, industrial, agricultural, and other land use practices or other discharges:

        a.    that will settle to form putrescent or otherwise objectionable deposits;

        b.    that are in amounts sufficient to be unsightly or deleterious;

        c.    that produce color, visible oil sheen, odor or other conditions in such degree as to create a nuisance;

             d.    which are in amounts sufficient to be acutely toxic to, or to otherwise severely injure or kill aquatic life, other animals, plants, or humans.

             which are in concentrations or combinations that will cause or contribute to the growth of aquatic plants or algae to such degree as to create a nuisance, be unsightly, or otherwise impair the designated uses.
    
    13.    IC 13-18-4-5 states, in part, that it is unlawful for a person to throw, run, drain, or otherwise dispose into any of the streams or waters of this state, or to cause, permit, or suffer to be thrown, run, drained, allowed to seep, or otherwise disposed into any waters, any organic or inorganic matter that causes or contributes to a polluted condition of any waters, as determined by a rule of the board adopted under section 1 and 3 of this chapter.

    14.    IC 13-30-2-1 states, in part, that a person may not discharge, emit, cause, allow, or threaten to discharge, emit, cause, or allow any contaminant ...., either alone or in combination with contaminants from other sources, into the environment .... in any form that causes or would cause pollution that violates or would violate rules, standards, or discharge or emission requirements adopted by the appropriate board under the environmental management laws.

    15.    IDEM contends that Respondent's discharge of oil into the ditch/tributary of the Patoka River constitutes violation of 327 IAC 2-1-6(a)(1), IC 13-18-4-5 and IC 13-30-2-1.

    16. Pursuant to IC 13-30-3-3(c), entry into the terms of this Agreed Order does
not constitute an admission of any violation contained herein.


    17.    In recognition of the settlement reached, Respondent waives any right to administrative and judicial review of this Agreed Order.

          Respondent has developed and submitted to the IDEM, Office of Enforcement, a spill control and contingency plan for the Site. The plan was approved by IDEM on October 8, 1998. The plan includes provisions for notification of spills of oil or brine to the IDEM, Office of Environmental Response and the steps to be taken for spill prevention, containment, and clean up. IDEM's review of Respondent's spill control and contingency plan was solely as a requirement of settling this action and in no way relieves the Respondent of the obligation to comply with all applicable rules and statutes. Nothing in this provision prevents Complainant from exercising its full enforcement authority as to all permit requirements, rules or statutes.

II. ORDER

    1.    This Agreed Order shall be effective ("Effective Date") when it is approved by the Complainant or his delegate, and has been received by the Respondent. This Agreed Order shall have no force or effect until the Effective Date.

    2.    Respondent shall comply with all applicable sections of the Indiana Code and the Indiana Administrative Code referenced in the Findings of Fact of this Agreed Order.

    3.    Respondent is assessed a Civil Penalty of One Thousand Dollars ($1,000). This amount is substantially less than would otherwise be assessed, based upon Respondent's documented proof of Inability to Pay the higher amount. Said penalty amount shall be due and payable to the Environmental Management Special Fund within thirty (30) days of the Effective Date of this Agreed Order.

    4.    The civil penalty is payable by check to the Environmental Management Special Fund. The check shall include the Cause Number (B-2161) of this action and shall be mailed to:
                
                IDEM Cashier
                100 N. Senate Avenue
                P.O. Box 7060
                Indianapolis, Indiana 46206-7060.


    5.    In the event that the civil penalty amount required by paragraph 3 is not paid when due, Respondent shall pay interest at the rate established by IC 24-4.6-1-101.

    6.    This Agreed Order shall apply to and be binding upon the Respondent, its officers, directors, principals, agents, successors, subsidiaries, and assigns. Respondent's signatories to this Agreed Order certify that they are fully authorized to execute this document and legally bind the parties they represent. No change in ownership, corporate, or partnership status of the Respondent shall in any way alter its status or responsibilities under this Agreed Order.

    7.    In the event that any terms of this Agreed Order are found to be invalid, the remaining terms shall remain in full force and effect and shall be construed and enforced as if the Agreed Order did not contain the invalid terms.

    8.    Respondent shall provide a copy of this Agreed Order, if in force, to any subsequent owners or successors before ownership rights are transferred. Respondent shall ensure that all contractors, firms, and other persons performing work under this Agreed Order comply with the terms of this Agreed Order.

    9.    This Agreed Order shall remain in effect until Respondent has complied with all terms and conditions of this Agreed Order and Complainant has issued a close-out letter to Respondent.


TECHNICAL RECOMMENDATION            RESPONDENT
                                Gull Oil, Inc.

By: _________________________                By: _________________________
    Mark W. Stanifer, Chief                    Larry D. Gullett, President
    Water Enforcement Section                    and Registered Agent
    Office of Enforcement                Date: _______________
    Department of Environmental
     Management

                                
                                    

Date: _______________                    

COUNSEL FOR COMPLAINANT        COUNSEL FOR RESPONDENT

By: _________________________                By: _________________________
    Nancy A. Holloran                        Charles R. Nixon
    Office of Legal Counsel
    Department of Environmental
     Management

Date: _______________                    Date: _______________

APPROVED AND ADOPTED BY THE INDIANA DEPARTMENT OF ENVIRONMENTAL MANAGEMENT THIS _______ DAY OF _______________________, 1998.

                            For the Commissioner:

                            __signed 10/26/98_________________
                            Felicia Robinson George
                            Assistant Commissioner of Enforcement
                            

Converted by Andrew Scriven