(126d) Refinery and Petrochemical Liability Protection – Audit Your Offsite Disposal, Regeneration, and Recycling Facilities

How many of you are involved in Superfund sites or other similar situations where past disposal practices are costing you a bundle of money? How many of you are still facing recent or reoccurring incidents where past offsite disposal of your wastes, regeneration of your catalysts, or recycling of your materials have led to gnashing of teeth, conferences with senior management and lawyers, and more time and money spent on addressing and fixing the problem? There is a solution ? it is called auditing.

Certainly by now all of you perform compliance audits within your own facilities to ensure that you are meeting your permit conditions and other commitments. You also perform environmental due diligence assessments in compliance with ASTM and/or EPA standards and protocols to minimize your exposure when evaluating asset sale or purchase. You may even perform environmental management system audits to assess compliance with your documented system whether for certification or not. But how many of you actually audit what happens to your residuals once they leave the front gate, whether for recycling, regeneration, treatment, or disposal.

Quest Consulting, Inc. (Quest) has established a system of ranking potential environmental liability to the client (risk) as a result of using recycling, regeneration, and waste treatment/disposal facilities. In this system, the risk is ranked as low, moderate or significant, depending on the potential cost of the liability to the client and the client's risk tolerance. To reach this risk determination, the audit includes a multi-step review including the following:

? Electronic databases. ? State environmental agency file review. ? Agency interviews by phone or at their office to determine the results of recent inspections conducted by the agency and the facility's compliance and corrective action history. ? An interview by phone with the appropriate permit engineer(s) for the facility if needed. ? Interviews with agency enforcement staff as appropriate. ? Facility site visit. ? Interviews with facility staff.

To conduct the audit, Quest prepares an Audit Protocol that is comprehensive yet relatively brief. In addition, Quest follows good engineering and scientific principles in determining risk associated with sending waste or recyclable material to this facility. These general principles are based upon both American Society of Testing and Materials (ASTM) and Environmental Protection Agency (EPA) guidelines and protocols for performing environmental due diligence. However, not all elements of these guidelines are used, just those that contribute to an understanding and evaluation of risk. The audit protocol thus developed provides overall guidance on the type of information to be obtained and procedures to be followed as part of the audit, and is not intended as a checklist of questions to be answered. The purpose of developing the protocol instead of a checklist is to provide a ?big-picture evaluation? of potential environmental liability at the audited facility.

Quest recommends that this procedure be employed at least every 3 years for low-risk facilities and more often for higher risk facilities. It should include items like catalyst regeneration, radioactive instrument rehabilitation, hazardous and non-hazardous waste disposal, scrap metal recycling, and other offsite residual management.

The paper will present and discuss the Quest Audit Protocol and its merits. The paper will also discuss how the risk ranking is ascertained and what it means. Finally, several examples of how this procedure really works with some examples of actual audits for Frontier El Dorado Refining Company (Frontier) will be presented. Using this procedure and Quest's analysis, Frontier was able to determine which facilities should be used for future recycling, regeneration, and disposal.