Utah Oil Spill: Chevron Vows To Pay

06/18/2010 09:41 pm ET | Updated May 25, 2011

SALT LAKE CITY — Salt Lake City attorneys expect Chevron Corp. will quickly agree to a financial settlement related to last weekend's pipeline spill that dumped 33,000 gallons of crude oil into city waterways, a spokeswoman for Mayor Ralph Becker said Friday.

Becker has vowed to make Chevron pay for the cleanup, and the company has repeatedly pledged to cover the city's expenses, as well as damage or reimbursement claims from others.

A deal could be announced next week, said Lisa Harrison Smith, the mayor's spokeswoman.

"We won't be satisfied until it's done," she said.

San Ramon, Calif.-based Chevron believes an improbable series of events led to last Saturday's spill, which sent crude oil into pristine Red Butte Creek.

A short in an overhead 46,000-volt power line traveled to a fence post that acted like an electric arc welder, melting a quarter-size hole in the pipeline, the company said.

The bottom of the fence post was anchored just inches above the buried pipeline – an obvious danger that went unnoticed for 30 years, Chevron said.

"It would be highly unusual, but it's a plausible theory," Rocky Mountain Power spokesman Dave Eskelsen said.

Some of the spilled oil traveled in the creek through Salt Lake City to the Jordan River, which drains into the Great Salt Lake.

Chevron said it has cleaned up 21,000 of the 33,000 gallons of spilled oil. Much of that has been mopped and vacuumed from city waterways. Absorbent booms on the Jordan River have been capturing traces of oil, and workers were seen digging up oil-soaked soil Wednesday and sucking up residual oil from Red Butte Creek near the spill site.

Chevron said it plans to flush the Red Butte Creek with water Saturday to capture residual oil with absorbent booms. It warned residents the flushing could stir up oil fumes for three or four hours.

But the latest samples from 13 locations along Red Butte Creek and the Jordan River show no danger to human health or aquatic life, Utah Division of Water Quality officials said.

The U.S. Department of Transportation has jurisdiction over oil pipelines and is investigating what caused the spill, said Patricia Klinger, a spokeswoman for the department's pipeline-safety group. A metallurgist is examining the pipe, she said.

The department's Pipeline and Hazardous Materials Safety Administration can fine Chevron, but has no authority over Rocky Mountain Power, which owns the nearby fenced compound and power lines near the pipeline, Klinger said.

Chevron officials said earlier this week that more than 30 claims had been filed with the oil company. The company is taking full responsibility and expects to get hit with a large amount of bills for damages and expenses, Chevron spokesman Dan Johnson said Friday.

"We think that's appropriate," he said. "People who pay their bills are trusted."

The Utah Rivers Council on Friday called for Chevron to deposit $15 million into an escrow account to pay for damages and cleanup expenses. But the expected settlement agreement would make an escrow account unnecessary, Smith said.