San Pedro butane storage company agrees to pay $260,000 fine to EPA

The operator of a large butane storage site in San Pedro that has long drawn complaints from residents has agreed to pay a $260,000 fine for safety and inspection lapses at the facility, federal environmental officials announced Thursday.

Rancho LPG Holdings LLC, the owner of two liquid petroleum tanks that can hold up to 25 million gallons of flammable substances, entered into a consent agreement with the Environmental Protection Agency, which cited the operation for four violations related to risk management plan requirements.

The 40-year-old facility on Gaffey Street is near schools, homes, shopping areas and playing fields. For decades, community groups and harbor-area activists have sought to close the site, claiming the two 80-foot-tall steel tanks are outdated and unsafe.

They say such a facility would not be built so close to residential areas now, and note the site is next to a soil liquefaction area and in the rupture zone of the Palos Verdes Fault.

The EPA, which began its investigation in April 2010, found that the facility did not have complete safety information to evaluate potential seismic stresses, and failed to analyze the potential loss of water supplies for firefighting in the event of an earthquake.

Agency officials also found that Rancho LPG failed to properly inspect and test equipment, including a storage tank and a drain system used to contain accidental releases of butane and propane.

“When a company handling high risk materials operates in close proximity to a neighboring community, it’s critical to take steps to safeguard the residents,” said Jared Blumenfeld, the EPA’s regional administrator for the Pacific Southwest.

The consent agreement states that Rancho LPG has corrected the violations, and made modifications to bring the site into compliance with federal environmental laws.

EPA officials said the company has installed new safety controls, inspected tanks, added seismic upgrades and improved coordination with local public safety agencies.

Janet Gunter of San Pedro Peninsula Homeowners United questioned the adequacy of the investigation, which she said did not address the site’s broader safety issues.

“This is less than a slap on the wrist,” Gunter said. “That plant should never have been built at its present location in the first place. The EPA only gives people who live around the tanks the illusion that there is some protection.”

In a statement, company officials said they disputed the EPA’s claims, and asserted that the storage facility is in compliance with federal law at all times.

Since acquiring the site in 2008, they said, Rancho LPG has spent $7.2 million for safety improvements and the facility has performed well in more than 45 inspections by local, state and federal regulatory agencies.

“We remain committed to operating the facility in a prudent and responsible manner, which safeguards our workforce and the surrounding community,” company officials said.

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