Since World War II, the pipes and tanks of a tiny, 1920s-era oil refinery in San Pedro have produced not a single barrel of oil. But in recent years, the crumbling insulation on that equipment has covered the ground with potentially deadly asbestos dust.
The situation--the subject of a two-year battle between state health officials and the Western Fuel Oil Co., which now leases the property--has resulted in civil charges that could lead to fines of $15 million or more if the firm is held liable for the possible health risks, the Los Angeles city attorney's office said.
The city, acting at the request of the state Department of Health Services, filed complaints in Los Angeles Superior Court last week seeking up to $25,000 a day in fines for alleged hazardous-waste violations and a temporary restraining order to force the company to comply with state health and safety regulations.
That order was granted pending a court hearing on the case Oct. 2.
Lack of Responsibility
"Going back at least until 1982, this asbestos has been shedding, peeling, sitting on the ground" at the site, said Steven Tekosky, head of the environmental protection unit of the city attorney's office. "We've seen a complete absence of any responsible management or control of the asbestos."
Health risks from the tiny asbestos particles--which can cause cancer and other serious lung disorders--probably are limited to company employees who enter the largely unprotected, contaminated area, Tekosky said.
The closed oil refinery occupies about one acre on a 60-acre fuel storage and distribution terminal at 2100 N. Gaffey St.
Western Fuel Co. spokesman Jim Bailey denied that there is any danger to the 18 employees who currently run the distribution terminal. He said employees are warned to stay out of the closed refinery and the area is roped off.
"They have no reason to go near the facility," he said. "It's inoperative and has been" for many years.
But health officials said repeated attempts to deal with the problem have been complicated by a tenant-landlord dispute over who is responsible for the asbestos.
The Western Fuel Oil Co., a subsidiary of the Coastal Corp., a multibillion-dollar Houston energy firm, has held a long-term lease of the property since the 1970s, Bailey said.
The company did not build the refinery, never has operated it and does not consider itself responsible for the crumbling insulation, he said.
"If we were operating the (refinery) facility, there might be some consideration given to fixing it up," Bailey said. "But we're not operating it, never have, and don't intend to. Our position is, it's the responsibility of the owner."
Shift of Responsibility
Westoil Terminals Co., a Los Angeles firm that purchased the site in the 1950s, in turn considers the leaseholders responsible, company spokesman Bill French said. In an interview, French said terms of the lease place the maintenance and operation of the entire site in the hands of Western Fuel officials.
"They're in complete control of the site," French said. "We don't even have to pay the taxes."
Under pressure from state health officials, the two firms have held several discussions in recent weeks to determine what must be done to resolve the issue, French said. Exactly what will be done--and who will pay for it--may not be determined until the case is settled in court, he said.
"We all recognize the problem has to be approached," French said. "But I don't think anybody knows how to approach it."
Problem Discovered in 1982
State health officials first learned of the problem in 1982 after Western Fuel applied for a permit to handle hazardous wastes at the fuel distribution terminal, city attorneys said.
A routine inspection of the property disclosed the fallen asbestos, and Western Fuel officials were ordered to erect fences and warning signs to protect company employees, city spokesman Mike Qualls said.
A 1984 state inspection showed that the company had not followed the order, Qualls said.
Jim McNally, a manager for the state's Toxic Substances Control Division in Los Angeles, said the firm is required to comply with state laws for handling the asbestos even though it has never begun processing hazardous wastes.
The city attorney's office ultimately filed the case against Western Fuel because the firm continued operating the site in defiance of of those laws, Tekosky said.
"Under (state) health and safety codes, it doesn't matter how long they've been on the site," Tekosky said, adding that the firm has had several years to comply with state laws by erecting signs and fences.
"Just because they might have a good civil case against their landlords does not shield them from California law," he said. "They've had ample time to file a lawsuit against their landlord, but obviously they've chosen not to."