Fort Worth-based XTO Energy has been hit with criminal charges alleging it illegally dumped more than 50,000 gallons of wastewater at a well site in Pennsylvania.On Tuesday, Pennsylvanias attorney general issued a statement saying it was charging XTO with five counts of unlawful conduct under the Clean Streams Law and three counts under the Solid Waste Management Act. It said a state grand jury had recommended the criminal charges.XTO in July settled with federal regulators in the 2010 incident, in which fluid from waste tanks in Lycoming County was found leaking into a nearby stream. XTO agreed to pay a $100,000 civil penalty and spend $20 million improving wastewater handling, while noting at the time that it acted quickly to clean up the spill.In a statement posted Tuesday on its website, XTO called the charges unprecedented and an abuse of prosecutorial discretion, saying criminal charges are unwarranted and legally baseless. It said there was no intentional, reckless or negligent misconduct by XTO.The oil and gas producer, a subsidiary of Irving-based Exxon Mobil, said the U.S. Department of Justice conducted a full investigation for more than a year and concluded that criminal charges were not warranted.The pollution was found during an unannounced visit in November 2010 by the Pennsylvania Department of Environmental Protection. It said at the time it found an open valve on one of the water tanks at the well site.According to the Pennsylvania AGs statement Tuesday, XTO hired a contractor to recycle wastewater at its Marquardt well site, but after a week told the contractor to move its equipment to another XTO site.However, XTO allegedly continued to transport and store gas well wastewater at the Marquardt site despite not having the proper equipment on site to safely store or process it, the AGs statement says. It said the grand jury found that XTO did not have a permit to discharge wastewater at the site and failed to report any spills.The statement included additional detail of the incident, saying state inspectors discovered a discharge valve on a tank was open and a drain plug removed. There was also evidence of prior wastewater discharges from other storage tanks at the Marquardt site, it said.XTO was ordered to remove 3,000 tons of soil to clean up the area. Wastewater discharged from natural-gas wells can contain chlorides, barium, strontium and aluminum, the AGs statement says.In its statement Tuesday, XTO said bringing criminal charges under these circumstances could discourage good environmental practices. It said the action tells oil and gas operators that setting up infrastructure to recycle produced water exposes them to the risk of significant legal and financial penalties should a small release occur. This report contains material from Bloomberg News.
Jim Fuquay, 817-390-7552 Twitter: @jimfuquay