Childers Oil Co. Blamed For Polluting Water Source

WHITESBURG, Ky. -- Childers Oil Co. is being blamed for polluting its hometown water source, twice in four months.

The petroleum marketer and operator of 45 Double Kwik convenience stores is facing environmental sanctions, a criminal investigation and lawsuits for polluting the North Fork of the Kentucky River after the state blamed the company for an oil sludge leak in November 2008 and a diesel fuel leak in February 2009.

In early March, state regulators sought a court order that would bring a contempt of court charge against the company if it has further leaks, such as the one in February that resulted in residents being unable to use water for cooking, drinking and bathing for 10 days.

Calls from CSNews Online to Childers Oil Co. were not returned at press time.

In November, oil waste allegedly seeped from a company site into the river a mile upstream from the city water plant, regulators said. In February, diesel fuel spilled into the river from a site where the company stored dozens of large fuel-storage tanks four miles upstream from the city, according to a citation.

In addition to a criminal investigation of the November spill, Childers Oil faces fines of up to $25,000 a day per violation from the two leaks.

The state Energy and Environment Cabinet filed a lawsuit against Childers Oil and a sister corporation, Mountain Rail Properties Inc., both owned by Don Childers, according to a report in the Lexington Herald-Leader. The cabinet asked Franklin Circuit Judge Phillip J. Shepherd to issue an injunction barring the companies from allowing more leaks of petroleum products.

"It is the personal right of the citizens of Letcher County to live in a safe environment and to have clean drinking water," state attorneys said of the request.

The law already prohibits companies from letting contaminants spill into streams. But the requested injunction would add a potential contempt of court charge if Childers Oil again contaminates waterways, as it allegedly has.

The state also asked Judge Shepherd to order the companies not to place any more petroleum-storage tanks at the site of the most recent leak; to put a spill-control plan and best-management practices in place; and to disclose whether they disposed of petroleum byproducts or waste at any other sites for which they did not have permits for such substances, the newspaper reported.

Childers Oil and Mountain Rail agreed to meet the requests. At the time, Missy Matthews, Childers' daughter and a vice president of the company, told the newspaper: "We've done everything they have asked us to do and more, so an agreed upon order between us certainly makes sense. There is no reason for litigation or a hearing."

In a statement on the company's Web site, posted in late February, a week after a water advisory was lifted, management addressed its customers and neighbors, saying they are "grateful for the many people who gave of themselves throughout the incident and those who have offered support for our efforts."

The company promised to continue testing water samples every day along the river from its property to the water intake of the plant and from the plant's treated water.

"Some questions remain unanswered about the water samples taken by the state," according to the company's message. "For example, we are interested in learning where those tests were taken and why it took so long to get results returned and have the advisory lifted. These are important questions for all of us who use the North Fork of the Kentucky River as a water source.

"Childers Oil will continue to act as a good neighbor and a responsible company. We’ve been part of this community for more than 40 years and plan to be here for many more. We are proud to call Whitesburg and Letcher County home."
Missy Matthews said the injunction was not necessary—the company was already doing everything the state asked of it, and it maintains that it is not at fault.

In the months since the November spill, Matthews recently told the Lexington Herald-Leader, the family considered "checking out" of the business because of the animosity toward their family. But they love their community and their customers, she said.

Residents are divided over where the blame lies for the petroleum leaks from his property, the newspaper reported. Some accept the leaks were accidents. Others in Letcher County wonder whether there are other incidents they don't know about.

"What else is happening that we're not aware of?" said Josephine Richardson, co-owner of the popular Courthouse Café in Whitesburg and a plaintiff in one of the lawsuits against Childers over polluted water. "I think there's a real health concern in the community."

In addition to two recent environmental spills near Whitesburg, Childers Oil has been cited for at least 10 other violations since 1995, according to State Energy and Environment Cabinet records.

The violations include improperly burning debris; improperly dumping construction waste, including construction debris; leaking or improperly registered and upgraded underground fuel storage tanks; sewage station overflow; and not filing correct monitoring reports, the newspaper reported.

The company was not fined for the violations, but was responsible for cleaning up the sites.

In one 1995 case, the state issued notice of violation for two dump sites. According to state records, an inspector was told by a Childers employee that he had been instructed by Don Childers to "bring used oil from the shop" to ignite waste including shingles, oil filters, tires and other hazardous debris on property behind the Whitesburg Walmart, but not to make a big fire, and that Childers would bring a bulldozer to cover up the waste later.

In a response letter, the Childers employee wrote, "I was also wrong in thinking there were certain kinds of debris that we could burn" and said employees would be instructed that all waste must go to a permitted landfill.

Matthews told the newspaper the lawsuits and criticism don't paint a true picture of her father or the business, saying Childers wouldn't deliberately do anything to hurt his neighbors

"We love this community," she said.

"We take pride in providing a community with something they don't have," she told the newspaper, namely clean stores, safe parking lots, ATMs and the ability to get money orders in places like Virgie, Ky., where customers otherwise would have to drive a long way to find those things.

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