Home > Uncategorized > Murphy DEP Says They Were Flying Blind In Negotiating $200 Million Pollution Settlements With Big Oil

Murphy DEP Says They Were Flying Blind In Negotiating $200 Million Pollution Settlements With Big Oil

Did the AG just make up that $200 million number out of thin air? Pull it out of a hat?

In a stunning admission, the Murphy DEP’s response to my MTBE Natural Resource Damage OPRA request claims that DEP has no documents that provided a basis to negotiate the recent $200 million settlement with Big Oil for contaminating groundwater and drinking water supplies across the state at thousands of sites with the fuel additive MTBE.

DEP replied to my OPRA request as follows:

Addendum Disposition Notes: The records you seek, namely “Natural Resource Damage Assessments” for the settlements announced by Attorney General Grewal in his 3/12/18 press release, are not made, maintained, kept on file or received by the NJDEP. For additional background as to the terms of the settlements, please see the New Jersey Register: Sunoco 49 N.J.R. 2552(a), Shell 49 N.J.R. 2974(b), and BP 49 N.J.R. 2815(a); as well as, the following NJDEP websites: http://www.nj.gov/dep/srp/legal/ and http://www.nj.gov/dep/nrr/settlements/index.html

The settlement documents (i.e. the terms of the settlements) and the DEP websites suggested by DEP to provide background do not provide any technical information regarding the magnitude, location, degree, and extent of groundwater contamination; the number of facilities that released MTBE to groundwater; the DEP’s definition of “natural resource injury”, or the DEP’s economic methodology for quantifying natural resource injuries for the purposes of legally required compensation and/or restoration.

This is incredible.

How did the Attorney General negotiate and arrive at $200 million as an appropriate settlement to compensate the public, if there are no technical documents that factually define the extent of injury and quantify the economic value of the natural resource injury and/or natural resource restoration?

Did the AG just make up that number out of thin air? Pull it out of a hat?

How did the AG arrive at $200 million as acceptable public compensation if he did not know the extent of the damage? Or the cost of restoration?

Shouldn’t the public be provided this information as a fundamental factual basis for the settlements?

I filed the OPRA request in order to gauge whether the $200 million in settlements was adequate to compensate the public and/or restore natural resource injuries and to understand the extent of MTBE pollution,

I was trying to find out how DEP valued drinking water Natural Resource Injuries and whether they had a damage assessment like the $8.9. billion in the Exxon documents.

In the Exxon case, DEP hired a consultant to provide a detailed rigorous Technical report on the extent of natural resource injuries, and an economic methodology for quantifying natural resource injuries and mandatory public compensation and/or restoration in the amount of $8.9 billion.

Under DEP site remediation program regulations, polluters (RP’s) must conduct natural resource injury screening and if damage is found, conduct a damage assessment and compensate or restore injuries.

The applicable NJ DEP regulations define “injury” as follows:

“Injury” means any adverse change or impact of a discharge on a natural resource or impairment of a natural resource service, whether direct or indirect, long term or short term, and that includes the partial or complete destruction or loss of the natural resource or any of its value.

Natural resource damages are an essential component of the cleanup process. During the “remedial investigation phase of the cleanup process, DEP rules require that poluters:

7:26E-4.1 Remedial investigation requirements

(a) The purpose of a remedial investigation is to:


  1. Collect and evaluate all data necessary to:
    1. Evaluate the actual and potential ecological impacts of the contamination; and
    2. Identify any natural resource injury;

Other DEP cleanup rules assure that NRD and MTBE injuries are explicitly not inadvertently extinguished by DEP:

(b) Any covenant not to sue that accompanies a final remediation document is without prejudice to any rights that the Department, the Commissioner, and the Administrator of the New Jersey Spill Compensation Fund may have against the person responsible for conducting the remediation and any person in any way responsible for a discharge, pursuant to the Spill Compensation and Control Act, N.J.S.A. 58:10-23.11g, with respect to liability for:

1. Cleanup and removal costs, damages (including primary and compensatory restoration damages and the costs of any natural resource damage assessments) and injunctive relief, for injury to, destruction of, or loss of natural resources;

2. Cleanup and removal costs, damages, and injunctive relief available to the Plaintiffs in the United States District Court for the District of New Jersey, in the case captioned NJDEP et al. v. Amerada Hess Corp. et al., C.A. No. 3:07-5284, and subsequently pending in the United States District Court for the Southern District of New York, captioned as In Re; Methyl Tertiary Butyl Ether (“MTBE”) Products Liability Litigation, MDL No. 1358; and

3. Cleanup and removal costs, damages, and injunctive relief available to the Department, the Commissioner, and the Administrator of the New Jersey Spill Compensation Fund in any litigation or claim pending as of the date of a final remediation document.

This rules prevent cleanup contractors from getting polluters off the hook for NRD and specifically DEP retain control over any damages to assure full compensation and/or restoration:

In concluding that this remediation has been completed, I am offering no opinions concerning whether either primary restoration (restoring natural resources to their pre-discharge condition) or compensatory restoration (compensating the citizens of New Jersey for the lost interim value of the natural resources) has been completed.

Did Gov. Christie’s Attorney General and DEP Commissioner negotiate the MTBE settlements with absolutely no technical and factual analysis of the extent of natural resource injuries to groundwater that the Big Oil companies were responsible for compensating the public for lost use or restoring?

It looks like Big Oil got a statewide sweetheart deal – involving thousands of toxic sites – without even conducting the minimum natural resource injury analysis DEP rules require for a single contaminated site?

In conclusion:

1. I find it hard to believe that the State was flying blind in the MTBE lawsuits.

2. I find it equally hard to believe that neither DEP, a DEP consultant, or the Big Oil polluters were required to conduct a study to document the extent and economic value of damaged natural resources for the purpose of establishing a baseline for negotiations.

3. I find it almost as hard to believe that the DEP OPRA office would stonewall me.

But these are the 3 logical alternatives I can think of.

Either that, or I have something very fundamentally wrong with my understanding of the DEP NRD program. 

Here is the groundwater injury program: (which has never been adopted as regulation and is therefore of questionable enforceability and legally vulnerable, as I’ve written many times):

NRI — Ground Water


Ground water is both an environmentally sensitive resource and a potential pathway to other natural resources such as surface water and wetlands. Approximately 50 % of the State’s 8.5 million residents utilize ground water as a drinking water source. It is also important for agricultural and industrial uses. The NJDEP considers ground water to be injured when contaminants are above NJ Ground Water Quality Standards.

Ground water injuries should be characterized during the remedial investigation process. This process must delineate the horizontal and vertical extent of contaminants in all media at the site and determine the general surface and subsurface characteristics of the site, and the depth of ground water (see N.J.A.C. 7:26E). Once characterization information is complete, it is used in the ground water injury calculation to determine resource value.

The ground water injury calculation establishes the relative magnitude of the restoration necessary to compensate for the injury. Once this value is calculated, the Department enters into settlement discussions with the responsible party to identify an appropriate restoration project.

The Department has a strong preference that the responsible party implements a project to restore injured natural resources. For ground water this is usually property acquisition to preserve aquifer recharge. However, the responsible party has the option to provide monetary damage damages (based on the result of the injury calculation) in lieu of implementing a restoration project. The Department is obligated to utilize these funds to implement appropriate restoration projects by maintaining a nexus to the ground water injury. These damage monies may be used to fund property acquisitions or other open space projects. ONRR will often partner with the expertise of the Green Acres Program to accomplish acquisition of open space occuring in the same aquifer or watershed as the injury.

Ground Water Injury Calculation Data

Use the links below to get information on how to run the ground water injury calculation:

Ground Water Injury Calculation gw_injury_calc_200305.pdf (51 KB)
Water Rate Table 2002water_rate.pdf (8 Kb)
Planning Area Map plan_area_map.pdf (141 Kb)

GIS Data:

Did Big Oil just ignore all that? Or did the AG and DEP not require that their now NRI methods be followed?

And it sure looks like the Murphy administration has no intention of reforming this kind of practice.

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