The U.S. Environmental Protection Agency has reached a record-setting $4.2 million settlement to resolve violations connected to the 2019 explosion and fire at the former Philadelphia Energy Solutions refinery, federal officials said Tuesday.
The penalty imposed on Philadelphia Energy Solutions Refining and Marketing is the largest EPA has ever handed down for a single incident covering violations of the Clean Air Act.
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The explosion at the 150-year-old refinery happened during the early morning hours of June 21, when a fire in the facility's hydrofluoric acid unit led to three blasts at the site along the Schuylkill River in Southwest Philadelphia. The explosion was so powerful that it launched a 38,000-pound piece of equipment across the width of the Schuylkill River, in addition to other heavy debris scattered in the vicinity. The fire at the refinery took two days to extinguish.
A report from the U.S. Chemical Safety Board determined the disaster was caused by a faulty elbow joint among the pipes in the refinery's alkylation unit. The decades-old part had corroded down to half the thickness of a credit card and had been long overdue for replacement.
At the time of the incident, PES processed about 335,000 barrels of crude oil per day — making it the largest refinery on the East Coast. The company is now in the process of liquidating after filing for Chapter 11 bankruptcy.
EPA alleged PES did not safely manage the refinery's extremely hazardous substances as required by the Clean Air Act. The company failed to identify the hazards at the refinery and didn't develop accident prevention and emergency response programs, the agency said.
The settlement announced Tuesday is the last of four the EPA has reached with PES, including three others in 2020 stemming from other violations and costs related to the aftermath of the explosion.
As part of the settlement filed in U.S. Bankruptcy Court, PES did not admit liability. The agreement will have a 30-day public notice and comment period before it receives final approval. Penalties determined in bankruptcy court will be paid to the U.S. Department of the Treasury.
Benzene, another hazardous chemical byproduct linked to refinery operations, was also found in higher concentrations near PES than at any other refinery in the country, according to a report from the nonprofit Environmental Integrity Project. Exposure to benzene can raise the risk of cancer and a variety of other medical conditions. Asthma and respiratory problems are common complaints in communities surrounding oil refineries.
The EPA is working with state regulators to oversee the complex cleanup of the site. In 2020, the land was purchased for $225.5 million by Hilco Redevelopment Partners. The 1,300-acre property is being repositioned as the Bellwether District, a future hub for e-commerce, logistics and life sciences. The project broke ground last year and construction started on two warehouses earlier this year.
The 2019 explosion and its aftermath were featured last year in a documentary titled "Midnight Oil," which was produced by a former PES refinery worker who examined the fallout of the incident and its impacts on his colleagues and the surrounding community in Southwest Philadelphia.
