PBF Energy misleads public on cost of fish protections at Delaware City Refinery
The refinery's ancient cooling system is killing millions of fish
In preparation for its restart, in 2010 the Delaware City Refinery signed a contract with the State of Delaware that committed them to modernizing their circa-1957 cooling water intake system using the Best Technology Available (BTA). The existing cooling structure uses 303 million gallons/day of water in a "once-through" system that kills over 30 million fish each year, including valuable commercial and recreational species such as striped bass.
DNREC Secretary David Small recently replaced this contract with a settlement agreement. The agreement waives fees for water pollution permit violations and reverses the state's position requiring a BTA determination to protect Delaware River fish – as part of a federal water discharge permit. Instead, the Refinery will install an interim measure, Modified Traveling Screens, which only addresses up to 6.4% of fish killed at the Refinery, and will not return fish back to the main channel of the Delaware River. In so doing, Secretary Small ignored 40 years of DNREC research and recent staff recommendations that closed-cycle cooling, a system which recycles water and can reduce water intake and fish kills by up to 95%, represents the BTA.
In recent hearings on the cooling system, the Refinery misrepresented their financial position to DNREC, and Delaware's union men and women, by claiming that the costs to upgrade the cooling system to cooling towers would put jobs at risk.
However, since the refinery restart, its owners – PBF Energy – have achieved a strong financial position, largely through the use of new rail facilities to unload North American crude oil from trains. PBF has rewarded shareholders through generous quarterly dividends, buying back shares, and saving on taxes through their creation of a Master Limited Partnership logistics subsidiary.
In 2014 alone, PBF Energy returned $260 million to shareholders, generated $600 million in net cash proceeds, and paid its top five executives a combined $22.7 million in salary, bonuses, stock awards, and other compensation. PBF's balance sheet shows available liquidity of $1 billion as of December 31, 2014, and a committed credit line of $3.3 billion.
On June 18, PBF Energy announced its acquisition of a fourth refinery, located in Louisiana, utilizing existing capital on hand. As this acquisition demonstrates, PBF Energy has ample financial resources to renovate the last remaining piece of infrastructure original to the refinery's construction in 1957, at an estimated cost of $120 to $300 million. This is inconsistent with what the refinery management has told the public.
An upgrade of the refinery's cooling system to the Best Technology Available would provide economic and ecological benefits. In addition to creating well-paying union jobs for cooling tower construction and operation, it would be a boost to surrounding businesses in and near Delaware City, commercial and recreational fishing, and ecotourism on the Delaware Bayshore.
Commercial and recreational fishermen have been forced to reduce or eliminate fishing for numerous species along the Atlantic coast and in Delaware, specifically through moratoriums on alewife, American shad, and blueback herring, and harvest restrictions on American eel, Atlantic herring, Atlantic menhaden, striped bass, and weakfish. Yet the Delaware City Refinery's impact on our fisheries remains unmanaged.
The cooling system also impacts endangered species, including federally endangered shortnose sturgeon and Atlantic sturgeon, which would be harmed in the cooling water intake channel through repeated exposure to intake flows, re-impingement because of the lack of an adequate fish return system, thermal discharges of heated cooling water that have lethal and sublethal direct effects on sturgeon, and disruption of their foraging behavior.
Pea Patch Island, in the Delaware Bay near the Refinery, is a Continentally Important Bird Area and home of the largest heronry of mixed species on the east coast. These herons and egrets depend upon a high abundance of nearby fish to feed their young. These fish are killed in large numbers by the Refinery, adding another major stress to a bird population critical to the ecotourism that resides at the gateway of Delaware's Bayshore.
Where is Delaware's leadership to create jobs that benefit our economy and our environment? Will Governor Markell act to end the protracted killing of aquatic life by the Delaware City Refinery? Or, must the EPA step in and take over the administration of this federal water discharge permit?