January 26, Mr. John Warren, Vice President LOTT 1001 School Street El Dorado, AR RE: Complaint Investigation/Crude Oil Spill

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1 January 26, 2011 Mr. John Warren, Vice President LOTT 1001 School Street El Dorado, AR RE: Complaint Investigation/Crude Oil Spill Dear Mr. Warren: On January 13, 2011, I performed a complaint investigation of a LOTT pipeline crossing near Village. The complaint alleged that crude oil was in an unnamed tributary to Harper Creek. This investigation was performed in accordance with the provisions the Arkansas Water and Air Pollution Control Act, and the regulations promulgated thereunder. This investigation revealed the following violation: Crude oil was observed in an unnamed tributary to Harper Creek. The Arkansas Air Pollution Control Act prohibits pollution, as defined in , of any waters of the State or to place or cause to be placed any sewage, industrial waste or other waste in a location likely to cause pollution of the water of this state. (A.C.A A). This oil was coming from a spill which occurred under County Road 64. It appeared groundwater was pushing the crude oil out from under the road and into the tributary. The above items require your immediate attention. Please submit a written response to these findings to Ms. Cindy Garner, Branch Manager, of the Water Division Enforcement Branch at the address below. This response should contain detailed documentation (i.e. pictures and a corrective action plan) describing the course of action taken to correct the items noted. This corrective action should be completed as soon as possible, and the written response is due by February 5, It was also noted that this crude oil spill was not reported to the El Dorado Field Office as per the ADEQ Guidelines for Reporting, Responding To and Remediating Crude Oil, Saltwater and Brine Spills, (Revised 1999). Item B of the guidelines state Any responsible party which creates a spill or has knowledge of a spill must notify the ADEQ District Field Office immediately or as soon as reasonably possible after discovery of any spill or release of oil.which enters the Waters of the State regardless of the quantity of spill..spill notification to the ADEQ District Field Office should occur within 24 hours of discovery or occurrence of the spill. A completed spill report should be sent to the field office as soon as possible.

2 Page 2 For additional information you may contact the enforcement section by telephone at or by fax at If I can be of any assistance, please contact me at Sincerely, John W. Lamb District 8 Field Inspector Water Division cc: Water Division Enforcement Branch Water Division Permits Branch NPDES Report Page 2

3 ADEQ Water NPDES Inspection AFIN: No AFIN Permit #: No Permit Water Division NPDES Photographic Evidence Sheet Location: LOTT Pipeline Crossing, County Road 64, Village, AR Photographer: John W. Lamb Witness: None Photo # 1 Of 4 Date: 1/13/2011 Time: 12:33 Description: Crude oil in tributary Photographer: John W. Lamb Witness: None Photo # 2 Of 4 Date: 1/13/2011 Time: 12:33 Description: As above NPDES Report Page 3

4 ADEQ Water NPDES Inspection AFIN: No AFIN Permit #: No Permit Water Division NPDES Photographic Evidence Sheet Location: LOTT Pipeline Crossing, County Road 64, Village, AR Photographer: John W. Lamb Witness: None Photo # 3 Of 4 Date: 01/13/2011 Time: 12:34 Description: As above further down stream Photographer: John W. Lamb Witness: None Photo # 4 Of 4 Date: 01/13/2011 Time: 12:43 Description: Crude oil seeping from ground then flowing into tributary NPDES Report Page 4

5 ADEQ Water NPDES Inspection AFIN: No AFIN Permit #: No Permit GPS LOCATION: N W DATE RECEIVED: 12 January 2011 COMPLAINANT NAME: Robert Farrell ADDRESS: Unknown PHONE: WATER DIVISION NPDES COMPLAINT REPORT TRACKING & REFERRAL INFORMATION AFIN: none PERMIT#: none COUNTY: Columbia COMPLAINT AGAINST: LOTT ADDRESS: 1001 School Street, El Dorado PHONE: PERSON RECEIVING REPORT: DATE: SUPERVISOR REFERRAL: DATE: J. Lamb 01/12/11 INSPECTOR REFERRAL: DATE: MEDIA SUPERVISOR REFERRAL: DATE: PHONE REFERRAL CONTACT: DATE: RECEIVING INSPECTOR: DATE: COMPLAINT RECEIVED BY: PHONE LETTER VERBAL INTERNET DETAILED DESCRIPTION This complaint came from EPA Region 6 Dallas, EPA received the complaint on 12/07/2010 and forwarded it to ADEQ on 01/12/11. Complainant states that crude oil is in creek near Lion Oil Pipeline. LOCATION 0.25 miles West of Village, on County Road 64 PREVIOUS COMPLAINT: YES NO DATES: DISCHARGE TO WATERBODY: YES NO NAME OF WATERBODY: INVESTIGATION INSPECTOR: DATE: John Lamb 13 January 2011 ACTION TAKEN: PHOTOS TAKEN: YES NO On 13 January 2011, I visited the site as described by the complainant, due to Mr. Connery Salter, ADEQ Inspector, being out of town. I noted a small amount of crude oil in some small puddles in an unnamed tributary and on leaves for approximately 100 meters North of County Road 64. This crude oil appeared to be seeping from a small seep on the LOTT (Lion Oil Transportation and Trading) pipeline. When I arrived back at the office I contacted Mr. John Warren, Vice President and Glenn Green, both of LOTT. They both stated that a crude oil spill had occurred under the pavement on County Road 64 awhile ago and that LOTT had been by several times to clean up the oil. They felt that the groundwater table was pushing the crude out from under the road and then into the tributary. Mr. Green stated that they would get a crew out on the next morning (Friday the 14 th) and clean up the crude again. He also stated they were weighing their options on future clean up such as digging up the road and/or digging a catch pit beside the road to catch the oil and prevent it from entering the tributary. This spill had not been reported the Field Office as per the Spill Reporting guidelines. FURTHER ACTION: Letter sent to Mr. Warren. Contacted the complainant via on January 19, 2011 and informed him of my findings. SIGNATURE: John W. Lamb DATE: 19 January 2011 NPDES Report Page 5

6 SPILL REPORTING AND DATA ENTRY FORM State of Arkansas DEPARTMENT OF ENVIRONMENTAL QUALITY MAIL TO: ADEQ El Dorado Field Office, P.O. Box 10340, El Dorado, AR Reporting Party: Lion Oil Trading & Transportation Address: 1001 School Street, El Dorado, AR Person(s) Responsible for Clean-Up: LOTT, Jack Kingrey Phone: Type of Material Spilled: Crude Oil Volume of Spill: 2 BBL Spill Release Date: 11/26/10 Time: 7:45 AM ADEQ Notification: Name: C. Salter Date: _1/31/11 Time: _4:00 PM Directions to Spill Location (please provide map): Rural area near Village Community, Columbia County, Columbia 36 approx. 0.6 W of int. w/ SH98 Detailed Description of Spill Site (use additional paper if necessary): Lightly populated area near Village Community, mixed pine/hardwood timber Explain Circumstances/Cause of Release: _ corrosion If spill entered the Waters of the State: Describe Waterway Effected, Size and Extent of the Contaminated Area: N/A Type of Containment Measures Employed in Waterway: _contingency booms were placed in the nearby no name creek Describe Size of Area Affected by Release Using Drawing, Photos, and/or Videos for Documentation: oil visible at site was less than one barrel and was contained in the road ditch Discuss Initial Spill Response, Measures Taken and Equipment Utilized in Containing Spill: One pipeline Maintenance crew including 1 road vacuum truck, one backhoe, Volume/Type of Spill Material Recovered: No significant material expected to be recovered - Page 2

7 Disposal/Handling of Recovered Spill Material: Free oil to be taken to LOTT slop tank at Magnolia Station, if any is recovered Was Contaminated Vegetation, Underbrush, Debris Removed?: No If Yes, how was the Contaminated Material Removed, Handled/Disposed? If Contaminated Material was Not Removed, Explain Why Not: Landfarm resid insitu Discuss Proposed/Planned Remediation Efforts to be Utilized at the Spill Site: (Soil removal, bioremediation, treatment, onsite burial, etc.) How were Contaminated Media (pads, hay, booms) Handled/Disposed?: creek booms were picked up for reuse If Soil Treatment Cells are to be Utilized, Give Description of Cell Construction, Location, and Type of Treatment Employed: Estimated Date for Completion of Clean-Up: February 25, 2011 Discuss Proposed Plans for Returning Site to Pre-Spill Conditions and Final Closure of Spill Site: Provide a Detailed Listing of Expenses Incurred for Spill Response and Clean-Up Activities at This Site: One pipe maintenance crew expected for 2 weeks including backhoe NOTE: It is recommended that photos or videos be provided to document all aspects of initial response, clean-up, remediation and closure. Revised: October 2003

8 ADEQ Ms. Cindy Gamer, Branch Manager Water Di vision Enforcement Branch 530 I Northshore Drive North Little Rock, AR RE: Oil Spill on Highway 36 Columbia County Village, AR S. 10, T. 17S, R. 19W Dear Ms. Cindy Garner, LION OIL TRADING & TRANSPORTATION, INC SCHOOL STREET P.O. BOX 7005 EL DORADO, ARKANSAS (870) January 31, 2011 On November 25, 2010 Lion Oil Trading and Transportation, Inc. (LOTI) responded to a spill reported by a LOTT Gauger on the side of Highway 36 in Columbia County near Village, AR in Section 10 oftownship 17 South and Range 19 West. Less than 5 gallons of crude oil had run down the side ofthe road way into the road ditch. The crude oil had not reached a pot hole of water at a nearby covert under the highway. It was determined that the LOTT pipeline was leaking from under Hwy 36 and could not be immediately repaired. The pipeline section was shutdown and isolated at that time. The free oil was recovered from the pipeline and the road ditch. The site was monitored through the weekend with no significant drainage from the site. On November 29 th LOTT crews pigged the pipeline section out to remove any remaining crude in the pipeline. The pipeline was inspected and hydro-tested on either side ofhwy 36. A One-Call was made for the area and poly-pipe was pushed through the pipeline under the highway to replace the bad pipe. New isolation valves were installed and the right of way cut for better aerial viewing and the pipeline was put back.. Ln service. Apparently the act ofdigging up both ends of the pipeline under the highway opened up a pocket of oil that was pooled in the road bed under the highway and flowed into the drainage ditch downstream of the culvert during the next rain event. LOTT estimated the volume ofoil at less than 1 barrel of crude oil. Since receiving the call from Mr. Lamb, LOTI cleanup crews have returned to the site several times recovering all of the free oil present each time and installed containment

9 booms at 2 locations along the ditch. Absorbents have been spread over the stained areas to absorb any sheen. LOTT will continue to return to the site until no additional leaching occurs. LOTT will send photos of the area when the final clean-up has been made by the end of February. LOTI is committed to returning this site to a condition better than prior to the leak event. Sincerely, ~j{/~ John Warren VP - Operations Lion Oil Trading & Transportation, Inc.

10 SPILL REPORTING AND DATA ENTRY FORM State of Arkansas DEPARTMENT OF ENVIRONMENTAL QUALITY MAIL TO: ADEQ EI Dorado Field Office, P.O. Box 10340, El Dorado, AR Reporting Party: _Lion Oil Trading & TransportatioD _ Address: 1001 School Street, EI Dorado, AR _ Person(s) Responsible for Clean-Up: LOTT, Jack Kingrey Phone: _ Type of Material Spilled: Crude Oil _ Volume of Spill: _2 BBL. _ Spill Release Date: 11/26/10 _ Time: 7:45AM _ ADEQ Notification: Name: _CO Salter Date: _1131/11 _ Time: 4:00 PM --- Directions to Spill Location (please provide map): _Rural area near Village Community, Columbia County, Columbia 36 approx. 0.6 W of int. wi SH98 Detailed Description of SpiII Site (use additional paper if necessary): _Lightly populated area near Village Community, mixed pinefhardwood timber----- _ Explain CircumstanceslCause of Release: _ corrosiod _ If spill entered the Waters ofthe State: Describe Waterway Effected, Size and Extent of the Contaminated Area: N/A _ Type of Containment Measures Employed in Waterway: _contingency booms were placed in the nearby no name creek'-- _ Describe Size of Area Affected by Release Using Drawing, Photos, and/or Videos for Documentation: ou visible at site was less than one barrel and was contained in tbe road ditch Discuss Initial Spill Response, Measures Taken and Equipment Utilized in Containing Spill: _ One pipeline Maintenance crew including 1 road vacuum truck, one backhoe, Volwne/Type of Spill Material Recovered: _ No significant material expected to be recovered Page 2

11 DisposaVHandling of Recovered Spill Material: _Free oil to be taken to LOTT slop tank at Magnolia Station, if any is recovered _ Was Contaminated Vegetation, Underbrush, Debris Removed?: No _ If Yes, how was the Contaminated Material Removed, HandledlDisposed? _ If Contaminated Material was Not Removed, Explain Why Not: Landfarm resid insitu Discuss ProposedJPlanned Remediation Efforts to be Utilized at the Spill Site: (Soil removal, bioremediation, treatment, onsite burial, etc.) _ How were Contaminated Media (pads, hay, booms) HandledJDisposed?: were picked up for reuse creek booms If Soil Treatment Cells are to be Utilized, Give Description of Cell Construction, Location, and Type of Treatment Employed: Estimated Date for Completion of Clean-Up: February 25,2011 _ Discuss Proposed Plans for Returning Site to Pre-Spill Conditions and Final Closure of Spill Site: Provide a Detailed Listing of Expenses Incurred for Spill Response and Clean Up Activities at This Site: _One pipe maintenance crew expected for 2 weeks including back hoe_ NOTE: It is recommended that photos or videos be provided to document all aspects of initial response, clean-up, remediation and closure. Revised: October 2003

12 March 8, 2011 Mr. John Warren LOTT 1001 School Street El Dorado, AR RE: Complaint Investigation/Crude Oil Spill Dear Mr. Warren: The Department has received your response to the January 13, 2011 inspection of your facility by our District Field Inspector, John Lamb. Your response has been deemed deficient for the following reasons: The response did not contain detailed documentation (i.e. photos) of the items addressed in the January 31, 2011 response letter. A copy of the inspection report and the inadequate response is included with this letter for your review. Please submit an adequate response to Cindy Garner, Water Enforcement Branch Manager, by March 18, Failure to adequately respond by this date will be considered in determining the enforcement action, if required, for this construction site. Thank you for your attention to this matter. Should you have any questions, feel free to contact me at or you may me at carlsonm@adeq.state.ar.us. Sincerely, Michelle Carlson Enforcement Analyst Water Division Enforcement Section

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21 March 30, 2011 Mr. John Warren LOTT 1001 School Street El Dorado, AR RE: Crude Oil Spill on Highway 36, Columbia County Dear Mr. Warren: The Department has received your response to the January 13, 2011 inspection of your facility by our District Field Inspector, Connery Salter. Your letter appears to adequately address the discrepancies identified during the visit. The Department assumes the corrective actions taken will be maintained to ensure consistent compliance with the requirements of the permit. Acceptance of this response by the Department does not preclude any future enforcement action deemed necessary at this site or any other site. The Department will keep the inspection and response on file. If future violations occur that require enforcement action, the Department will consider the inspection and response as required by the Pollution Control and Ecology Commission Regulation No. 7, Civil Penalties. This regulation requires the Department to consider the past history of your site and how expeditiously the violations were addressed in determining any civil penalty that may be necessary for any future violations. If we need further information concerning this matter, we will contact you. Thank you for your attention to this matter. Should you have any questions, feel free to contact me at or you may me at Sincerely, Michelle Carlson Enforcement Analyst Water Division Enforcement Branch