Proposed $12m Natural Resource Settlement Announced for Silvertip Pipeline Spill

Sep 21, 2016

Governor Steve Bullock announces the $12 million proposed settlement to resolve natural resource damages from the July 2011 Silvertip Pipeline Break. The settlement with ExxonMobil is subject to a 30 day public comment period and approval from the U.S. District Court for the District of Montana.
Credit Jackie Yamanaka

ExxonMobil Pipeline Company agreed to pay 12-million dollars to the federal government and the state of Montana to resolve claims that stem from a 2011 pipeline break that spilled crude oil into the Yellowstone River in Laurel.

A proposed consent decree was filed in U.S. District Court on September 21, 2016 to address the natural resource damage.

Governor Steve Bullock was the state Attorney General in 2011. He set in motion the natural resource damage assessment process. In announcing the $12 million settlement, Bullock said the negotiations made sure ExxonMobil was accountable for the damages inflicted on one of Montana’s most important waterways.

“This proposed settlement marks yet another step in the process to return the Yellowstone River and its surrounding ecosystem to the majestic state it was prior to the oil spill,” Bullock said. “This proposed settlement goes a long way in protecting Montana’s Yellowstone River, one of the last, great, free-flowing rivers in the United States that plays a vital role in our strong $6 billion outdoor economy.

Among the provisions in the proposed settlement, the money would be used to restore riparian habitat and white pelican populations. There’s also money to compensate for lost recreational use of the river during the spill and clean-up.

ExxonMobil previously spent about $135 million on the cleanup and repairs that lasted for months.

Dan Carter, spokesman for the Billings ExxonMobil Refinery, attended the announcement at Riverside Park in Laurel.

“We view this as an adequate resolution to an adequate settlement to this natural resource issue for restoration, rehabilitation to the natural state before the spill,” he said.

Carter said the company has since replaced, directionally drilled and rerouted the Silvertip Pipeline deeper under the Yellowstone River. He said U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration (PHMSA), the federal agency that regulates pipelines, hydro-tested that section and approved the restart of operations in 2011. The pipeline was retested and again passed inspection in 2016.

U.S. Attorney for the District of Montana Mike Cotter (L), Assistant Attorney General John Cruden for the U.S. DOJ's Environment and Natural Resources Division (C), and Mary Capdeville, assistant attorney general for the Montana DOJ Natural Resource Damage Program visit after the settlement announcement.
Credit Jackie Yamanaka

This announcement does not conclude the government’s legal case with the Silvertip Pipeline break, said John Cruden, the assistant attorney general for the Environment and Natural Resources Division in the U-S Department of Justice.

“We will still have a complaint for a penalty but that is not yet resolved,” Cruden said. “Before we do anything with a penalty by our own policy we will attempt to negotiate with the company to see whether or not we can resolve it.”

Cruden said the state of Montana will not be involved in the negotiation over the penalties, only the U.S. Government.

Cruden added there is a reason why the restoration plan was announced before the penalty. 

“The river as a natural resource deserves the attention right away,” he said. “By doing it this way we are in fact jumpstarting the whole process and the public is going to be able to see  the result of our natural resource damage settlement much quicker. They’ll see the result this year.”

Before that can happen, the public will have the opportunity to comment on both the settlement and draft restoration plan.

A public hearing is scheduled October 12, 2016 at the Montana Fish, Wildlife and Park office, 2300 Lake Elmo Drive in Billings from 6:00-8:00 PM. Oral comments will be taken at that time. The deadline for public comment on the draft restoration plan is October 31, 2016.

Public Comments can be sent via email to NRDP@mt.gov with “Yellowstone restoration plan comment” in the subject line.

Mail to:
Natural Resource Damage Program
PO Box 201425
Helena MT 59620-1425