The Pennsylvania Department of Environmental Protection announced Thursday that it has lifted a construction suspension on the Mariner East 2 pipeline project after Sunoco Pipeline LP agreed to pay a $12.6 million fine for permit violations.
The consent order lifts a Jan. 3 DEP decree that suspended permitted construction on the 350-mile pipeline to correct Sunoco's "egregious and willful violations," including unauthorized drilling to install the pipeline and failing to notify the agency when discharges or spills of drilling fluid occurred.
DEP called the penalty "historic" and said it includes a stringent compliance review.
"Since the permit suspension over a month ago, Sunoco has demonstrated that it has taken steps to ensure the company will conduct the remaining pipeline construction activities in accordance with the law and permit conditions, and will be allowed to resume," DEP Secretary Patrick McDonnell said in a statement.
"DEP will be monitoring activities closely to ensure that Sunoco is meeting the terms of this agreement and its permits," he said. Sunoco's permits allow it to conduct horizontal drilling to install the pipeline and to cross streams and waterways.
Sunoco Pipeline said in a statement that it strongly disagreed with DEP's characterization that the company's conduct was willful or egregious, but it thought it was important to move forward rather than engage in continued litigation. It said it was committed to fully complying with the order, and that safety is paramount.
The company said construction of the horizontally drilled sections of the pipeline are 64 percent complete, and that 93 percent of the main pipeline is finished. "We look forward to completing the Mariner East 2 project safely and beginning service in a timely manner," it said.
Environmental groups and pipeline opponents, some of whom had hoped the state would revoke Sunoco's permits, said they were disappointed with the end of the permit suspension.
Joseph Otis Minott, executive director of the Clean Air Council, which has been Sunoco's chief legal antagonist, called the settlement "a slap on the wrist for the destruction it has caused to priceless natural resources and harm to nearby residents." Food and Water Watch organizer Sam Rubin called the deal "outrageous."
But the restart of construction was good news for the project's supporters, including the Pennsylvania Energy Infrastructure Alliance, which represents labor and business groups.
"DEP's action proves that regulators are being an effective watchdog to ensure safe, responsible development," Kurt Knaus, the alliance spokesman, said in a statement. "With the stop-work order lifted, this project can get back on track and Pennsylvania's skilled laborers can get back to work."
The $12.6 million penalty will go to the Clean Water Fund and the Dams and Encroachments Fund. The agency said the penalty is one of the largest civil penalties collected in a single settlement. Sunoco is owned by Energy Transfer Partners LP, one of the nation's largest pipeline companies.
The pipeline construction project has been plagued by complications including many leaks of clay-like drilling fluids, called "inadvertent returns," some of which have fouled private water wells. The construction leaks occur during the underground drilling of a bore into which the steel pipeline is installed, and do not involve the pipeline contents.
DEP said Sunoco submitted a revised operations plan that sets forth additional measures it will put in place "to ensure that all permit conditions will be followed at all times moving forward, as well as additional measures and controls that Sunoco will implement to minimize inadvertent returns and water supply incidents."
While Sunoco was clearing the slate Thursday with state regulators over its construction practices, it faces ongoing regulatory scrutiny from a federal pipeline agency over its its existing pipeline operations.
The U.S. Pipeline and Hazardous Materials Safety Administration on Thursday posted two notices of probable violations against Sunoco for failing to inspect its pipelines as often as required under the law. One citation proposes $163,700 in fines for tardy inspections of pipelines connecting the Philadelphia Energy Solutions refinery complex to nearby fuel storage sites; a second citation proposes a $127,000 fine for untimely inspections of above-ground facilities at Boston Logan Airport.