Updated March 25 at 12:28am

Southern Union guilty of mercury-storage charge


PROVIDENCE – Southern Union Co., the Houston-based owner of New England Gas Co. and former owner of Providence Gas Co., today was found guilty of illegally storing mercury at a Pawtucket site, federal officials said.

The verdict – announced by U.S. Attorney Robert Clark Corrente; Ronald J. Tenpas, assistant attorney general in charge of the R.I. Department of Environmental Management’s Environment and Natural Resources Division (ENRD); and Michael E. Hubbard, special agent in charge of the U.S. Environmental Protection Agency’s Boston-area office – came almost exactly one year after the company’s Oct. 16, 2007, indictment by a federal grand jury on a trio of hazardous-waste charges. (READ MORE).

Prosecutors noted that in 2001, Southern Union launched a program to remove mercury-containing regulators from customers’ homes. (Such regulators had been installed in homes built before the 1960s to control the flow of piped-in natural gas.)

Initially, the company hired an environmental services company to safely remove the mercury, the document states. New England Gas workers would bring the regulators to a company facility at the end of Tidewater Street in Pawtucket, at the edge of the Seekonk River. The contractor then would remove the mercury from the devices and Southern Union’s environmental coordinator would ship it to a distillation facility.

But that system allegedly collapsed after the removal contract expired at the end of 2001. Gas company technicians continued to remove the regulators from customers’ homes, but the mercury-containing devices then were stored in a vacant building at the Tidewater facility – some in plastic kiddie pools, according to the original indictment in the case – and liquid mercury also was being stored on site, the prosecutors alleged.

Although requests for proposals (RFPs) for removal of the mercury accumulating at the Tidewater plant were drafted by a local executive in 2002, 2003 and 2004, the company allegedly never finalized those RFPs or put them out to bid. By July 2004, more than a gallon of mercury was being stored at the site –in “various containers … such as glass jars and a plastic jug” – not counting that in old regulators from which mercury had never been removed, prosecutors said.

In September 2004, prosecutors contend, three youths broke into the mercury storage building at Tidewater, taking several containers of liquid mercury, breaking some of the containers and spilling mercury on the facility grounds, where puddles of the metal remained for about three weeks, and more at a nearby apartment complex. The break in, and spilled mercury, reportedly were discovered by a gas-company worker in October 2004.

Today, a U.S. District Court jury found Southern Union guilty of one count of illegal storage, the federal officials said. But jurors cleared the company of another count of illegal storage and one count of failing to properly notify emergency officials about a hazardous-material release. “Knowingly storing hazardous waste without a permit carries a maximum fine of $50,000 for each day of violation,” yielding a maximum possible fine of $38 million for the 760 days in question, Corrente’s office said. Sentencing in the case is slated for February 20.

“We are pleased the jury found Southern Union innocent of two of the three charges brought by the government,” company spokesman Jonathan Gasthalter told Providence Business News in a telephone interview. “The company has motions pending before the court to dismiss the only remaining count.”

The case – based on a joint investigation by the EPA’s Criminal Investigation Division (CID) and the DEM’s Office of Emergency Response and Office of Compliance and Inspection – was prosecuted by Assistant U.S. Attorney Terrence P. Donnelly, ENRD trial lawyer Kevin Cassidy and EPA-CID attorney Diane Chabot.

Southern Union Co. (NYSE: SUG) sold the former Providence Gas Co. to National Grid Plc in August 2006 but still owns the New England Gas Co. Besides utilities serving more than half a million natural gas customers in Missouri and Massachusetts, Southern Union also owns and operates North America’s largest liquefied natural gas import terminal, in Lake Charles, La., plus about 20,000 miles of natural gas pipelines. To learn more, visit www.SouthernUnionCo.com.

For information about the U.S. District Court for the District of Rhode Island and its decisions, visit www.rid.uscourts.gov. For news and information from the U.S. Attorney’s Office for the District of Rhode Island, visit hwww.usdoj.gov/usao/ri.


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