In an Aug. 25, 2009 file photo, a crew member with Anadarko Petroleum Corp., photographed through a car window, works on a drilling platform on a farm near Mead, Colo.
Ed Andrieski/AP

DOJ wins $5 billion environmental cleanup settlement

The multi-billion dollar energy company Anadarko Petroleum will pay $5.15 billion to fund environmental cleanup and compensate people who have suffered personally due to pollution, Deputy Attorney General James Cole announced on Thursday afternoon. The settlement concludes a years-long effort on behalf of the U.S. Department of Justice to seek damages for environmental damage allegedly caused by Kerr-McGee, an energy company which Anadarko Petroleum acquired in 2006.

Kerr-McGee was accused of polluting sites across the country with industrial waste, including parts of Navajo territory. In one case, Kerr-McGee allegedly contaminated the soil of Manville, N.J. with toxic sludge without alerting residents. Only after one resident discovered toxic sludge seeping into his basement did the EPA begin cleanup. In another case, the energy company was allegedly responsible for severe uranium pollution in Navajo country.

In a Thursday press conference, Cole described the $5.15 billion settlement as ”the largest recovery for cleanup of environmental contamination in the history of the Department of Justice.”

“Today’s announcement represents another critical step forward in our ongoing efforts to fight corporate misconduct and to remedy the health, safety, and economic consequences of environmental contamination,” he said.

Anadarko did not admit to any wrongdoing in its statement on the settlement and said the case against it stemmed from “alleged actions by Kerr-McGee.” The statement also noted that the company could receive “a gross tax benefit of approximately $1.65 billion associated with the settlement.” Much of the Justice Department’s recent settlement with J.P. Morgan was also tax deductible, reducing the cost of the bank’s alleged financial malfeasance.

Nonetheless, Cole told reporters he was confident the settlement with Anadarko would “more than cover the damages that have been caused by all of this.” Approximately 88% of the $5.15 billion will go to environmental cleanup, with the remaining 12% going to the more than 8,000 claimants who say their health suffered as a result of Kerr-McGee’s actions. The Justice Department originally demanded $25 billion.

Kerr-McGee “polluted indiscriminately and left others holding the toxic tab,” said U.S. attorney Anthony Bharara at Thursday’s press conference. In particular, the company allegedly spun off its environmental liabilities into a company called Tronox, which later filed for bankruptcy.

Assistant administrator Cynthia Giles of the EPA told reporters that “communities and tribal regions all across America have won a major victory” with the settlement.

“EPA vigorously pursued this case from start to finish for the benefit of the affected communities,” she said. “We believe a simple principle: If you make a mess, you clean it up.”