Legal and Ethical Analysis of Ashland Oil Inc. : Trouble At Floreffe

Essay by dkogaUniversity, Master'sA, March 2007

download word file, 11 pages 5.0

LEGAL CASE ANALYSISI. FactsIn 1987, with revenue exceeding $7 billion, Ashland Oil, Inc (AOI) was the sixtieth largest company in the US and the largest independent oil refiner in the country (1).

In addition to the refining business, AOI also diversified into other business segments including oil exploration, gas and convenience stations, oil change service stations, motor oil and related automotive chemicals, special chemical products and distribution, and engineering and construction (2).

On Saturday, January 2, 1988 at 5:02 pm, a 4 million gallon storage tank at the Floreffe terminal outside of Pittsburgh, Pennsylvania, collapsed while being filled, releasing a 3.9 million gallon wave of diesel fuel, making this the first major oil pollution accident for AOI (3).

By nightfall, nearly three quarters of a million gallons of oil had spilled into the Monogahela River, threatening the drinking water supply of communities in Pennsylvania, Ohio, and West Virginia (4).

Storage tank 1338 ripped open after being filled to 45 ft 10.25 inches with diesel fuel at 5:02 pm, January 2, 1988. Immediately AOI personnel shut off all pumps, called the National Response Center as required by the Clean Water Act, and turned off all electrical power in the terminal (5).

Soon, it was discovered that the spilled oil had crossed Ashland property lines onto nearby highway 837 and surrounding wetlands, as well as flowed onto the adjoining property of Duquesne Light Company. Over 700,000 gallons of oil also seeped into an open storm sewer which flowed into the Monogahela River (6).

Clean up of the spill began around 9 pm when the Coast Guard and hazardous materials removal experts stretched booms, absorbent pads, and air filled fire hoses across the river to contain and absorb the oil (7).

By 11 pm Saturday night, AOI had set up a...