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Husky Superior Refinery Explosion Caused $27M in Damages and $53M in Repairs, Other Expenses

Husky Superior Refinery Explosion Caused $27M in Damages and $53M in Repairs, Other Expenses

Wisconsin's only oil refinery not expected to resume full operations until 2020

Calgary, Alberta-based Husky Energy has stated that it does not expect its Superior WI unit, the site of an April fire and explosion, to resume normal operations for at least 18 to 24 months, which would place the restart at between January and July 2020 at the earliest. Initial estimates indicate that that repairs and site cleanup following the April fire and explosion at the only oil refinery in the State of Wisconsin could exceed $80 million dollars.

Husky had completed its $435 million purchase of the refinery from its previous owner, Calumet Specialty Products Partners L.P., in November 2017. Husky has said it expects that insurance will cover at least part of the costs associated with repairs and site cleanup at the facility. In addition to the Superior refinery, Husky also owns a refinery in Lima OH and 50% stake in another refinery in Toledo OH.

Class action lawsuit alleges that refinery owner's negligence caused explosion, fire

In a related development, KSTP-TV has reported that three Superior residents have filed a class action lawsuit in federal court alleging that Husky Energy, described as one of Canada's largest energy companies, was negligent in its operation of the facility during planned routine maintenance prior to the April 26 explosion and subsequent fire.

According to the plaintiffs (identified in court documents as Jasen Bruzek, Hope Koplin, and Neil Miller) and their legal counsel, the lawsuit could eventually involve "thousands" of additional plaintiffs.

The three plaintiffs are claiming the evacuation forced them to spend money on things like food, supplies, transportation and child care. One plaintiff, Hope Koplin, said her mother, who was in home hospice care prior to the fire, was so stressed by her evacuation to a nearby hospital that it led to her death died shortly afterward. Another plaintiff, Neil Miller, alleges that his house was covered with ash when he returned after the mandatory evacuation and that someone from Husky had told him the company would help clean up the mess. Nothing has been done so far, he said.

After reviewing the initial court filings, Husky Energy's media relations coordinator Kim Guttormson issued a statement saying, in part:

"Since the April 26 fire, we have been working to resolve any related claims, including those for accommodation, food and lost wages. To date, about 98 percent of the claims presented to us have been successfully closed and we continue to address the others …"

"We are cooperating fully with those agencies investigating the incident. As this matter is before the courts, it would not be appropriate to comment further."

In support of their lawsuit, the plaintiffs state that:

  • In 2008 refinery's previous owner, Murphy Oil, paid a $179,100 fine to settle some 30 federal safety violations.

  • In 2015, the Occupational Safety and Health Administration (OSHA) cited the refinery for multiple violations involving the storage of flammable and combustible liquids, hazardous waste operations, and emergency response procedures

  • On April 26 of this year, Husky's negligent response to the incident caused a nuisance and trespass on private land of soot, ash and toxic substances.

  • On the morning of the explosion, several workers employed by Evergreen North America and Jamar Contractors, Inc., companies that had been hired by Husky Energy to do routine refinery maintenance, said that they ran from their work area after hearing "a strange knocking noise" coming from the refinery. Husky employees told them to go back to work, however, and the workers complied with that request. According to federal investigators, 30 to 45 minutes later the refinery blew up. At least seven of those workers have filed their own lawsuits against Husky in relation to the incident.

U.S. Chemical Safety Board says worn valve caused Husky Superior explosion

As part of its "ongoing investigation" into the fire and explosion at the Husky Superior Refinery, the U.S. Chemical Safety Board (CSB) has released its preliminary opinion regarding what it believes was the cause of this April's explosion and fire that led to a mandatory, precautionary, overnight evacuation of areas near and downwind of the refinery.

According to the CSB, the blast occurred in the refinery's fluid catalytic cracking unit, which was being shut down for routine maintenance. That refinery unit converts hydrocarbons found in petroleum into gasoline. During the maintenance shutdown, the CSB determined that conditions existed that could have allowed air to flow backward across a worn valve and into an area containing flammable hydrocarbons, which caused the explosion.

As luck would have it, the explosion happened while most workers were on a scheduled break. Many were in blast-resistant buildings or were away from the blast area at the time of the explosion and subsequent fire.

You can read the CSB's interim report on the CSB website. You can also watch a computer-generated recreation of the events leading up to the explosion by following this YouTube link.

At the Doan Law Firm, we will continue to monitor future developments in this incident and will provide updates as circumstances may dictate.

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