Friday, June 30, 2017
By Walter F. Roche Jr.
Major elements of US Nitrogen's manufacturing facility are decades old and two ammonia production plants were shipped from Peru, where they lay dormant for years.
The details on the aging equipment were disclosed in court filings in Georgia where the Greene County chemical company has filed suit against a contractor,Weatherly, Inc. The Atlanta based firm, provided engineering services for the construction of US Nitrogen's $200 million ammonium nitrate manufacturing facility.
According to a "statement of undisputed facts," filed by lawyers for Weatherly, two skid-mounted ammonia plants were purchased by US Nitrogen's parent, Austin Powder, in 2010 from
Grupo Gloria. Though they were decades old, the two plants had never been put into operation, the 19-page filing states.
The filing in U.S. District Court in Atlanta also states that the nitric acid plant utilized by US Nitrogen was some 30-years-old when it was purchased from the Olin Corp. in Lake Charles Louisiana.
The acid plant has been the source of several missteps in the attempts to bring the Midway facility up to full operation.
Attempted startups of the acid plant resulted in two major incidents in which toxic vapors were released into the atmosphere.
US Nitrogen is suing Weatherly for $30 million charging that mistakes by the engineering firm resulted in heavy damage, forcing expensive repairs and causing major startup delays.
Weatherly has denied the charges and has cited a provision in its contract with US Nitrogen limiting any damages to $2.2 million.
The "statement of undisputed facts" filed by Weatherly states that the ammonia plants were manufactured in the 1970s by N-REN, a company that went bankrupt in 1986. The plants were sold to Louisiana Chemical which shipped them to their facility "where the plants sat idle for 20+ years."
They were then sold to Grupo Gloria and shipped to Peru.
According to the suit the two plants "were never previously placed in service" when they were purchased by Austin Powder in 2010.
The filing states that the nitric acid plant was also purchased in 2010 from the Olin Corp. It was 30-years-old at the time of the purchase, according to the filing.
US Nitrogen, in an amended 29-page complaint charged that even more defects were discovered after it filed its original complaint against the engineering firm.
Newly discovered defects included the design of storage tanks that "caused cracks and other defects."
The suit charges Weatherly with breach of contract, professional negligence and negligent or fraudulent misrepresentation.
The suit charges that the foundations for the 35,000 pound compressors were designed to hold only 3,500 pounds and that both foundations failed.
In the most recent development, US Nitrogen was given until July 12 to respond to Weatherly's motion for summary judgement.
Tuesday, June 20, 2017
By Walter F. Roche Jr.
An administrative law judge has formally denied a series of appeals filed by Greeneville, Tenn. area residents challenging permit granted by Tennessee environmental officials to US Nitrogen.
In a series of letters issued on May 17 Administrative Law Judge Rob Wilson denied the appeals filed by some 18 residents challenging permits issued to US Nitrogen by the Tennessee Department of Environment and Conservation.
According to TDEC records, the appeals challenged permits allowing US Nitrogen located in Midway to draw millions of gallons of water per day from the Nolichucky River for use in the production of liquid ammonium nitrate. Another protested permit allows the company to discharge water directly into the river.
The appeals, all filed in 2014, were consolidated into a single case.
In one appeal Stan Olmstead of Jonesborough charged that the permits would result in the degradation of the river.
Others filing appeals included Don Bible and Jack and Margaret Renner. Bible said he did not recall ever being informed of a hearing on the appeals.
Many of those filing the appeals stated that they lived along the Nolichucky.
Wilson stated in a letter denying the appeals that all parties had agreed to the dismissals on May 16. The appeals were dismissed "with prejudice.":
The appeals were one of several efforts by local opponents of the US Nitrogen project to block the construction and use of the $200 million manufacturing facility.
Thursday, June 15, 2017
By Walter F. Roche Jr.
A Greene County Commissioner has introduced a resolution that he says could force US Nitrogen to leave its $220 million chemical manufacturing facility within a year.
Stating that the company has failed to keep any of its promises to local residents, Commissioner Eddie Jennings said his resolution would effectively revoke the 2011 rezoning that enabled the ammonium nitrate manufacturer to locate in the county.
Under his resolution the US Nitrogen site would revert to agricultural zoning and the company would have one year to vacate the premises.
Jennings acknowledged in an interview that county attorneys told him his resolution was not legal, but he has decided to press the issue.
"They (US Nitrogen) need to make good on all the things they lied about," Jennings said, adding that his resolution should come up at the commissioners' July meeting.
He said US Nitrogen promised to buy water from the local utility district and to use the local wastewater treatment facilities. Those promises would have generated considerable income.
Instead, Jennings said, the company is taking water from the Nolichucky River and discharging wastewater back into the river without paying anything.
Jennings said his concerns about the company were heightened by recent events including the discharge of toxic vapors from the Midway facility.
"My grandson goes to a school not far from there," Jennings said, noting the concerns about the lack of a warning system to notify local residents of emergency situations at the plant.
Jennings said he does expect some support from other commissioners but in any case his resolution should force US Nitrogen to answer "a whole lot of questions."
Monday, June 12, 2017
By Walter F. Roche Jr.
Tennessee environmental officials have imposed fines totaling $19,000 against US Nitrogen for failing to submit required annual certifications and for failure to complete testing required under one of its permits.
The fines, which could have been substantially larger, were set in two seven page orders issued by Michelle Owenby, a technical secretary for the Tennessee Department of Environment and Conservation. Notices of the fines were sent to US Nitrogen late last week.
The TDEC fines are in addition to separate penalties totaling some $18,000 imposed recently on the Greene County chemical firm by the town of Mosheim. Those penalties were issued due to excess levels of pollutants in wastewater discharged by US Nitrogen to the local water treatment facility.
One of the TDEC fines was imposed due to US Nitrogen's failure to timely submit required annual certifications on its compliance with the standards set under its permits. The company was required to certify that it was properly following its accidental release plan under each of those permits.
US Nitrogen already had acknowledged that the reports were filed late.
The state could have fined the company some $25,000 a day for the infractions. One certification that was due on Jan. 31 was not submitted until April 21. Other certifications of compliance were due on March 31 but were not submitted until May 2.
The reports were required under the permits including one for the anhydrous ammonium nitrate operations and one for the use of open flares.
The second fine was imposed for failure to conduct required emissions tests on the company's nitric acid plant. The startup of that facility has been marked by problems including the release of toxic gases on at least two occasions.
According to the violation notice, US Nitrogen was supposed to have completed emissions testing for the acid plant by April 29 of this year, one year after the official startup. US Nitrogen has stated that those tests won't be finally completed until August.
Friday, June 9, 2017
By Walter F. Roche Jr.
Acting on a deadline US Nitrogen has formally filed for conditional major operating permits with Tennessee environmental officials for seven of its manufacturing functions at its Midway, Tenn. facility.
The operational permits are the next step for the ammonium nitrate manufacturing facility in its protracted startup efforts.. The June 19 deadline for filing the conditional major operating permits was one of the conditions of another series of extensions granted to the company by the Tennessee Department of Environment and Conservation last year.
The operating permit applications include one for US Nitrogen's nitric acid plant, which has been plagued by aborted start up efforts and the release of toxic vapors. The toxic gas releases prompted complaints from some area residents.
In addition to the nitric acid plant, the permit applications were submitted for the ammonia and ammonium nitrate plants, a cooling tower, a steam boiler, open flare operations and a gasoline dispensing facility.
The June 19 deadline was one of the conditions of a series of construction permit extensions granted by TDEC last year.
The new permit applications were submitted by US Nitrogen's plant manager, Andrew Velo.
The Nov. 8, 2016 extensions of the construction permits gave the company until Dec. 31 to complete the construction phase. The extensions included a series of permit amendments sought by US Nitrogen.
Despite a series of permit violations, TDEC has thus far declined to impose any penalties. The town of Mosheim, however, has levied penalties on US Nitrogen for exceeding discharge limits for the town's wastewater treatment facility.
Penalties totaling $14,700 were imposed due to the excess levels of nitrogen and phosphate in wastewater US Nitrogen discharged to the treatment plant.