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    Murphy Oil Questions Penalty

    Independent refiner/marketer said it was unfairly punished earlier this year.

    SUPERIOR, Wis. -- Eight months after signing a consent decree that resulted in a $5.5 million civil penalty, Murphy Oil USA is saying it did nothing wrong.

    The refiner/marketer, best known for its partnership with Bentonville, Ark.-based Wal-Mart Stores Inc., said it was already making upgrades at its Superior refinery operation when it felt the oversight muscle of the Environmental Protection Agency and the Wisconsin Department of Natural Resources (WDNR), according to the The [Wis.]Daily Telegram.

    Both agencies were party to a lawsuit filed against the company for alleged violations of the Clean Air Act. Yet, according to David Podratz, Superior refinery manager at Murphy Oil, the company made environmental upgrades in 1991 that improved a pollution control device and helped cut emissions at the plant by half, The Daily Telegram reported.

    "At the time we made the changes, both the DNR and the EPA knew about the work being done and the DNR informed us in writing that we did not need any permits to do the work," Podratz told the newspaper. "Nearly a decade after the sulfur plant improvements were made, the EPA sued Murphy for having performed the environmental upgrade without the necessary permits."

    He added: "This was done despite the fact that Murphy and Wisconsin DNR signed a consent decree in 1994 resolving all air and water claims. This case was not about actual emissions. Everyone acknowledges that Murphy decreased real emissions. Specifically, the case revolved around a technical violation the EPA cited, using disputed evidence, that our potential emissions [not actual] went up."

    Based on Murphy Oil's perspective, the company was caught in the middle of competing environmental interests between the EPA and the state agency. Nonetheless, because of some setbacks during the discovery phase of the trial concerning admissible evidence, Murphy eventually agreed to pay a $5.5 million penalty and spend another $7.5 million to reduce sulfur dioxide emissions at the Superior refinery.

    "We set out to significantly reduce our sulfur emissions and we were tremendously successful in doing that," Podratz said in a January 2002 news release following the issuance of the consent decree.

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