WICHITA, KS Koch Industries is making major improvements in its environmental and health and safety records. These strides come on the heals of a series of enforcement actions by EPA that included what the former EPA Administrator Carol Browner called a "...landmark fine against Koch Industries for egregious violations of the Clean Water Act..."
In January 2000, Koch Industries Inc., agreed to pay the largest civil fine ever imposed, $30 million, to resolve claims over oil spills from its pipelines and oil facilities in Texas, Oklahoma, Kansas, Missouri, Louisiana and Alabama. The company also agreed to improve its leak-prevention programs and spend $5 million on environmental projects.
Earlier in December 2000, the Justice Department and the EPA announced an environmental settlement in which Koch Petroleum Group agreed to spend an estimated $80 million to install up-to-date pollution-control equipment at two refineries in Corpus Christi, Texas and one near St. Paul, Minn., and to pay a $4.5 million penalty to settle Clean Air Act violations and other environmental claims at its Minnesota refinery.
Later, in March 9, 2000, Koch Petroleum Group was sentenced to pay a total of $8 million serve three years probation for releases from its Rosemount, Minn. refinery operations.
And as recently as last April, 2001, Koch Industries, Inc. and Koch Petroleum Group, L.P. (Koch) pleaded guilty and agreed to pay $10 million in criminal fines and also agreed to spend $10 million for environmental projects in the Corpus Christi area and to complete a five year probation and adhere to a strict new environmental compliance program.
Companies owned by Koch Industries, Inc., and its subsidiaries are now managing environmental, health and safety (EH&S) programs that position them as innovative operators in their respective industries. In 2001, subsidiaries of Koch reported safety and environmental milestones that underscore their commitment to superior EH&S performance.
"Koch companies and their subsidiaries know long-term success in their industries depends on continually improving safety and environmental performance," says Chris Wilkins, compliance director for Koch Industries, Inc. "Employees of Koch companies have personal ownership of the safety and environmental outcomes and because of their commitment, these businesses continue to establish ever-improving safety and environmental benchmarks."
Safety and environmental performance reported by Koch-owned companies for 2001 include:
Koch Petroleum Group, the company that was restructured into Flint Hills Resources, LP and Koch Supply and Trading, on January 1 had no lost time accidents in 2001. Its 2001 Occu7pational Safety Health Administration recordable rate was 1.53. In April 2001, the group was the first refining company to enter a voluntary settlement with the U.S. Environmental Protection Agency on environmental issues including leak detection and repair, new source review, benzene waste, sulfur, plant operations, and flaring. Continuing a multi-year trend, total agency reportable environmental events from the refineries were down in 2001 by more than 50 percent compared to 1999. The Pine Bend, Minn., refinery had zero acid gas flaring events, down from more than 40 in 1996. Prior to January 1, Koch Petroleum's businesses included refineries in Minnesota and Texas and trading crude oil, chemicals, structured financial products and risk management tools.
Koch Chemical Technology Group LLC, a group of companies that supply industrial processing and pollution-prevention equipment and services, saw an overall reduction in lost time incidents of 48 percent, with a decrease in lost work-days of 44 percent. Brown Fintube, Koch-Otto York and Koch Knight, subsidiaries in this group, reported no LTIs (Lost Time Incidents) for 2001. The company's OSHA recordable rate was 3.9 per 200,000 man-hours worked. The standard manufacturing OSHA recordable rate was 9.0 for the same time period. Its agency reportable releases were unchanged from 2000, with only two occurring.
Koch's Hydrocarbon companies, which processes and transports natural gas liquids, duplicated its record with no lost time incidents or OSHA recordables at its processing facilities in 2001. To date, these facilities have worked over 400,000 work-hours with no OSHA recordable and over 1.2 million work-hours with no LTIs. The isobutane processing plant in McPherson, Kan., was recognized by the Gas Processors Association in July 2001 for exceeding 15 years without a LTI. The company's Hutchinson, Kan., fractionator and the Medford, Okla., fractionator earned awards for achieving five accident-free years. Agency reportable releases declined by 60 percent in 2001 over 2000 levels. The Mont Belvieu, Texas, fractionator received re-certification for its ISO 14001 environmental management system in November.
Koch Materials Company, a company that supplies asphalt products and construction expertise to worldwide projects, reported two lost time incidents overall; its east and north regions operated with no LTIs. Its OSHA recordable rate was 4.74. The company's agency recordable releases numbered 10 in 2001, limiting spills to 0.003 percent of product handled or 34.4 gallons of product for every one million gallons handled. In 2001, Koch Materials sold enough asphalt to pave about 125,000 lane-miles of road worldwide.
Koch Mineral Services LLC, a group of companies which store, transport and trade coal, petroleum coke, fertilizer, sulfur and cement, reduced its OSHA recordable injury rate by 65 percent from the 2000 rate, with lost time incidents down by more than 50 percent. Thirteen of the company's 16 sites completed the year without a recordable injury. The company's OSHA recordable rate was 1.46. The company had 14 agency reportable release events in 2001, down from 22 in 2000.
Koch Pipeline Company LP, which operated about 15,000 miles of North American pipelines in 2001, experienced only one lost time incident in 2001, achieving a 0.19 rate (per 200,000 work hours). Its northern division has worked five years with no LTIs. The company had six OSHA recordables in 2001 for a 0.97 rate. The pipelines transported about 1.5 million barrels of crude oil, refined products, gas liquids and ammonia fertilizer daily in 2001. It reduced its agency reportable releases to land, water and air to only 40 in 2001. The company received 18 different environmental, health and safety awards in 2001 from industry and governmental agencies.
KoSa B.V., which is owned by Koch Industries Equity Investments B.V. and Arteva Equities B.V., has polyester production operations in the United States, Mexico, Canada, the Netherlands and Germany. In 2001, its lost time incident rate was 0.24, which is 41 percent lower than the previous year. The number of lost workdays across all operations decreased 83 percent from 2000 figures. The OSHA recordable rate for KoSa's U.S.-based operations was 1.19, a 44 percent reduction from the 2000 figure. Worldwide, KoSa has developed a global metrics system for benchmarking the progress it makes annually to improve environmental and safety performance.
Koch Industries, Inc. is a Wichita, Kan.-based firm that owns a diverse group of companies engaged in trading, investment and operations worldwide. These companies regularly report their environmental, health and safety performance via brochures, progress reports and via the www.kochehs.com web site. More information about Koch Industries is available at www.kochind.com.
