OFFICE OF INSPECTOR GENERAL 

Catalyst for Improving the Environment 

Public Liaison Report 

Complete Assessment Needed to 

Ensure Rural Texas Community 

Has Safe Drinking Water 

Report No. 2007-P-00034 

September 11, 2007 
Report Contributors: Johnny D. Ross 

 Larry Dare 

Abbreviations 

EPA U.S. Environmental Protection Agency 

MCL Maximum contaminant level 

MTBE Methyl tertiary butyl ether 

OIG Office of Inspector General 

TCEQ Texas Commission on Environmental Quality 

Cover photo: Contaminated soil around the Mitchell Facility saltwater disposal tank farm 

(photo taken in April 2004 by Texas Commission on Environmental Quality). 
U.S. Environmental Protection Agency 2007-P-00034

Office of Inspector General September 11, 2007 

At a Glance 

Catalyst for Improving the Environment 

In 1996, residents in a small 

community in Panola County, 

Texas, complained of drinking 

water discoloration, stained 

kitchen and bath fixtures, and 

gastrointestinal problems after 

consuming water. Most 

residents had begun buying

bottled water or obtaining 

water from relatives. Between 

1996 and 2003, residents said 

U.S. Environmental Protection 

Agency (EPA) and Texas 

representatives took no action 

to help identify a permanent 

source of safe drinking water. 

In 2003, Texas found the 

groundwater was contaminated 

and advised residents to not use 

the water for domestic 

purposes. 

For further information, 

contact our Office of 

Congressional and Public 

Liaison at (202) 566-2391. 

To view the full report, 

click on the following link: 

www.epa.gov/oig/reports/2007/ 

Why We Did This Review 

We conducted this review in 

response to a hotline complaint 

alleging that a small 

community’s only source of 

drinking water had been 

contaminated by adjacent 

saltwater disposal operations. 

The complaint also alleged that 

Federal and State officials had 

not provided assistance 

obtaining safe drinking water. 

Background 

20070911-2007-P-00034.pdf 

Complete Assessment Needed to Ensure 

Rural Texas Community Has Safe Drinking Water 

What We Found 

A Panola County resident first alleged in 1996 that drinking water for residents in 

a small community in the county was contaminated. However, State officials did 

not confirm the problem until 2003, when they told the residents to not use their 

water for domestic purposes. In September 2005, EPA began providing, and 

continues to provide, bottled water to the affected residents. EPA and the State 

have taken additional steps to assess the source, severity, and extent of 

contamination. 

In March 2005 the State requested that Basic Energy Services, the site operator, 

assess groundwater, and in October 2005 the State requested that Basic Energy 

Services install additional monitoring wells. In March 2006, because Basic 

Energy Services’ performance was inadequate, the State indicated it would take 

enforcement action. However, we found no evidence that the State took 

enforcement action. Although the State has installed additional groundwater 

monitoring wells in the area, the full extent and source of contamination is still not 

known. Region 6 is confident that the contamination does not originate from 

injected waste. Even so, the State has initiated additional assessment action under 

State programs. 

Responding to a petition filed by Panola County residents in November 2006, 

EPA is conducting an assessment to determine if the site qualifies for cleanup 

under EPA’s Superfund program. Further, in its June 29, 2007, response to our 

draft report, EPA said that it intends to use removal action funds to pay for 

constructing a water line that will provide the residents with access to the Panola 

Bethany Water Supply Corporation. EPA decided to evaluate and fully assess 

the contaminated groundwater under its Superfund program, as well as to have 

the residents connected to the water system. In response to our suggestion that 

more frequent communication with the community would be beneficial, in 2007, 

the Region acted to keep the community informed. Region 6 stated they have 

held community meetings and Superfund staff have met with the citizens 

individually in preparation for additional site investigations. We commend the 

Region for these communication activities and encourage their continuance. 
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

WASHINGTON, D.C. 20460 

OFFICE OF 

INSPECTOR GENERAL 

September 11, 2007 

MEMORANDUM 

SUBJECT: Complete Assessment Needed to Ensure Rural Texas Community 

Has Safe Drinking Water 

 Report No. 2007-P-00034 

FROM: Eileen McMahon 

TO: Richard Greene 

 Regional Administrator, EPA Region 6 

This is our final report on the subject review conducted by the Office of Inspector General (OIG) 

of the U.S. Environmental Protection Agency (EPA). This report represents the opinion of the 

OIG and the findings in this report do not necessarily represent the final EPA position. Final 

determinations on matters in this report will be made by EPA managers in accordance with 

established resolution procedures. 

The findings in this report are not binding in any enforcement proceeding brought by EPA or the 

Department of Justice under the Comprehensive Environmental Response, Compensation, and 

Liability Act to recover costs incurred not inconsistent with the National Contingency Plan. 

The estimated cost of this report – calculated by multiplying the project’s staff day by the 

applicable daily full cost billing rates in effect at the time – is $375,251. 

Action Required 

In accordance with EPA Manual 2750, you are required to provide this office with a written 

response within 90 days of the date of this report. We have no objection to the further release of 

this report to the public. This report will be available at http://www.epa.gov/oig. 

If you or your staff has any questions regarding this report, please contact me at 202-566-2391 or 

mcmahon.eileen@epa.gov, or Paul McKechnie at 617-918-1471 or mckechnie.paul@epa.gov. 

 Assistant Inspector General for Congressional and Public Liaison 
Complete Assessment Needed to Ensure Rural Texas Community

Has Safe Drinking Water

Table of Contents 

Chapters 

1 Introduction ........................................................................................................... 1 

Purpose .......................................................................................................... 1 

Background .................................................................................................... 1 

 Noteworthy Achievements.............................................................................. 4 

Scope and Methodology................................................................................. 4 

2 Complete Assessment Needed to Ensure Community Has 

Safe Drinking Water ............................................................................................ 6

Data Collected to Date Do Not Definitively Identify 

 Source and Extent of Contamination......................................................... 6 

A Short-Term Solution Continues; EPA Conducts an Assessment .............. 9 

EPA Has Begun to Assert Its Oversight Authority.......................................... 10 

Conclusion...................................................................................................... 10 

Region 6 Response to Draft Report and OIG Comment ................................ 10 

Status of Recommendations and Potential Monetary Benefits ............................. 13

Appendices 

A Details on Scope and Methodology..................................................................... 14 

B Region 6 Response to Draft Report..................................................................... 15 

C Distribution ............................................................................................................ 18 
Chapter 1 

Introduction 

Purpose 

We conducted this review in response to a hotline complaint that alleged a small 

residential community’s only source of drinking water had been contaminated by 

adjacent saltwater waste disposal well operations. The complainant also alleged 

that the U.S. Environmental Protection Agency (EPA) and the State of Texas had 

not provided assistance to obtain safe drinking water. Our specific objectives 

were to answer the following questions: 

• Are the existing testing and sampling sufficient to provide an accurate 

assessment of contaminants in the soil and groundwater, the actual levels 

of contamination, and the potential effects on human health and the 

environment? 

• What are EPA’s and the State’s short- and long-term plans for providing 

safe drinking water to Panola County residents, and are there plans for 

fully assessing and, if necessary, remediating the saltwater disposal site? 

• Has EPA Region 6 provided enough oversight of the Texas Underground 

Injection Control program, the State’s responsiveness to the threats posed 

by known groundwater contamination, and the State’s assessment and 

remedial actions at the saltwater disposal site? 

Background 

Safe Drinking Water Act and Underground Injection Control Program 

The Safe Drinking Water Act of 1974, as amended, establishes statutory 

requirements for protecting underground sources of drinking water. Part C 

establishes a Federal/State system to regulate underground injection activities. 

EPA implements the statutory requirements of the Act through regulations and 

guidance. 

The underground injection activity in Panola County was classified as a Class II 

commercial saltwater disposal facility (Class II involves oilfield operations). 

During oil production, a large amount of saltwater waste is recovered and 

transported to saltwater disposal facilities to be injected back into the earth. At 

these facilities, a small amount of oil is recovered from the saltwater waste. The 

1 
remaining waste (brine) is disposed of by being injected into a Class II injection 

well. 

States can apply for primary responsibility for the Underground Injection Control 

program, including enforcement authority (primacy), under Section 1422 or 1425 

of the Safe Drinking Water Act; Title 42, U.S. Code, Sections 300h-1 and 300h-4, 

respectively. Texas has been granted primacy for its program under section 1425, 

or 300h-4 of the Code. EPA Region 6 still remains responsible for overseeing 

Texas’ program. Under section 1425, a State is required to demonstrate that the 

Class II portion of its Underground Injection Control program meets the 

requirements at section 1421(b)(1)(A) through (D), (A) through (D) of section 

300h(b)(1) of the Code, and represents an effective program to prevent 

underground injection operations that could endanger drinking water sources. 

EPA Region 6’s Source Water Protection Branch provides oversight of the Texas 

Underground Injection Control program. The Region 6 Superfund Division’s 

Emergency Response unit helps States respond to, assess, and remediate soil and 

groundwater contamination at hazardous sites. 

Panola County Complaint 

The complaint concerned a small community, consisting of seven families and a 

church, in the rural town of De Berry, Panola County, Texas. Residents stated 

that they first told Texas officials in 1996 that their drinking water was 

contaminated. They also stated that they discussed drinking water concerns in 

1996 with an EPA Region 6 employee, but the Region had no record of that 

employee nor could we locate that employee. They complained of water 

discoloration, stained kitchen and bath fixtures, and gastrointestinal problems. 

Most residents elected not to use the water and began obtaining water from other 

sources. Some bought bottled water from a discount chain store approximately 

23 miles away. Others, using personal containers such as milk jugs, obtained 

water from relatives in adjacent areas. 

The Texas Commission on Environmental Quality (TCEQ) and the Railroad 

Commission of Texas were aware of the Panola County residents’ concerns. 

TCEQ is responsible for addressing groundwater contamination from refined 

petroleum products and organic matter. The Railroad Commission of Texas is the 

State’s regulatory agency for oil and gas production, as well as underground 

injection activities. Sampling and testing conducted in 2002 by Basic Energy 

Services, the site operator, showed the presence of some contaminants above 

maximum contaminant levels (MCLs) used by EPA and States as health 

protection standards for drinking water. The Railroad Commission of Texas took 

no action at that time because an oilfield contamination source had not been 

definitively established. 

After conducting additional tests in 2003, the commission advised the residents 

not to use the water for domestic purposes and continued to assess water 

2 
conditions. The 2003 testing data showed the presence of several contaminants in 

the soil and groundwater. This confirmed the resident’s allegation that the 

groundwater was contaminated. Contaminants included barium, chlorides, total 

petroleum hydrocarbons, fecal coliform, benzene, toluene, ethyl benzene, and 

xylene. Based on these test results, the 

State advised residents to not use their 

water for domestic purposes. Until a 

full assessment is completed, the 

source of these contaminants cannot 

be definitively known and 

contamination from the injection site 

cannot be ruled out. Residents’ wells 

are also susceptible to pollution from 

surface runoff and bacterial 

contaminants, such as animal waste. 

Saltwater Injection Site 

The Mitchell saltwater disposal facility 

(top photo) was located approximately 

1/8-mile northeast of the affected 

community. It began operations in 

1987 as a commercial saltwater 

disposal facility. The disposal site 

consisted of a tank farm with eight 

large storage and processing tanks, a 

truck loading and unloading rack, a 

truck washout pit, a fresh-water well 

with storage tank and pump house, and 

an injection well (Mitchell #2). This 

injection well (center photo) had a 

permit to inject waste saltwater into 

the earth at an interval between 1,080 

and 1,110 feet. The well’s permit also 

established the base of the 

groundwater to be protected at 

250 feet. The Mitchell #2 well ceased 

operations sometime between October 

1999 and February 2000. 

After the Mitchell #2 well closed, Basic Energy Services continued to use the 

Mitchell facility (tank farm, washout pit, etc.) for all disposal operations except 

the actual injection of saltwater. After being processed at the Mitchell facility, the 

saltwater was pumped approximately 1/4-mile offsite to the AF Hall injection 

well (bottom photo). The AF Hall well was a stand-alone well permitted to inject 

waste saltwater into the earth between 3,474 and 3,578 feet. As a result of an 

Top: Tank Farm at Waste Disposal Site – 

Mitchell Facility. Center: Mitchell #2 Injection 

Well. Bottom: AF Hall Injection Well 

(photos courtesy TCEQ) 

3 
administrative permit violation, the saltwater disposal operation – which included 

the Mitchell Facility, Mitchell #2 injection well, and AF Hall injection well – was 

shut down in November 2004. At that time, Basic Energy Services started 

cleanup activities at both wells. 

When we visited the site in May 2005, all equipment had been removed. The 

wells had been closed and plugged. The contaminated topsoil had been removed 

and transported to another saltwater disposal site. Basic Energy Services had 

spread new soil and gravel over the site and installed three groundwater 

monitoring wells. 

Noteworthy Achievements 

EPA and the State of Texas have made progress toward fully assessing the 

severity, extent, and source of contaminants affecting the Panola County 

community and keeping residents informed. For example, the State has drilled 

additional monitoring wells to further assess the extent of contamination at and 

around the underground injection site. Since September 2005, EPA Region 6 has 

provided, and continues to 

provide, residents with bottled 

drinking water. In addition, the 

Region is conducting an 

assessment under its Superfund 

authority to determine if the site 

qualifies for federally funded 

remediation. Continued joint 

efforts by the State and EPA are 

a positive sign that, working 

together, they will be able to 

conclusively determine the 

source of harmful pollutants and 

help the affected residents 

establish a permanent source of 

safe drinking water. 

Scope and Methodology 

We conducted our review between May 2005 and July 2007. We visited the 

Panola County community and Federal, State, and local agencies to conduct 

interviews, obtain official records, and review files and electronic databases. 

We focused on allegations in the complaint received from the Panola County 

residents. We found no prior reviews pertinent to the complaint. We conducted 

this review in accordance with generally accepted government auditing standards, 

issued by the Comptroller General of the United States. Because our review was 

TCEQ staff taking samples from sludge and standing 

liquid during an inspection (photo courtesy TCEQ) 

4 
of a specific complaint, we did not evaluate overall management controls for EPA 

programs. Further details on our scope and methodology are in Appendix A. 

We did not pursue other issues that we became aware of during the course of our 

review. These included community residents’ legal action against the potential 

responsible party and an environmental justice complaint the community filed 

with EPA. The Office of Inspector General (OIG) does not normally comment on 

issues brought before the legal system or other complaints that have not yet been 

resolved by the Agency. 

5 
Chapter 2 

Complete Assessment Needed to Ensure 

Community Has Safe Drinking Water 

Since 1996, when a Panola County resident first complained to the State of Texas 

about drinking water contamination, EPA and Texas representatives have not 

fully characterized the extent of contamination or cleaned up the contamination. 

According to EPA representatives, they did not become aware of the resident’s 

complaint until 2002. In 2003, the State recognized the presence of harmful 

contaminants in the residents’ drinking water supply. However, despite 

considerable effort by the State and EPA, they still have not identified the source 

or extent of the contamination or cleaned up the contamination. We received the 

complaint in 2004 and began our review in May 2005. In September 2005, 

Region 6 began providing bottled water to the residents. Since 2005, State and 

EPA representatives have also increased their efforts to fully assess the source, 

severity, and extent of contaminants. Responding to a petition filed by a Panola 

County resident in November 2006, EPA is conducting an assessment to 

determine if the site qualifies for cleanup under EPA’s Superfund program. In its 

June 29, 2007, response to our draft report, Region 6 said it intends to use 

removal action funds to pay for constructing a water line that will provide the 

residents with access to the Panola Bethany Water Supply Corporation. To date, 

however, the residents do not have a permanent source of safe drinking water and 

the contamination has not been fully assessed or remediated. 

Data Collected to Date Do Not Definitively Identify 

Source and Extent of Contamination 

None of the analyses conducted as of February 2007 has definitively determined 

the source or extent of contamination in the Panola County community. The 

Railroad Commission of Texas, TCEQ, Basic Energy Services, and complainant 

have all conducted water quality analysis at the Panola County site. Region 6 

personnel told us they believe evidence shows the contamination did not originate 

from the injection well. The Regional Administrator further stated that recent 

sampling data confirms that groundwater contamination did not result from 

Underground Injection Control activities. Although we have not confirmed the 

Regional Administrator’s assertion, we agree that recent steps to provide a 

permanent source of safe drinking water and continued monitoring will 

effectively protect the health of Panola County residents. 

6 
Test Results Identify Contaminants 

Testing data, compiled from water samples taken between 2002 and 2005, 

identified some contaminants above MCLs in the groundwater at and around the 

Panola County injection site. From October 2002 until August 2005, at least six 

sampling events have been conducted by the Railroad Commission of Texas, 

TCEQ, Basic Energy Services, and the complainant. Data have shown various 

contaminants in the groundwater aquifer 35 feet below the surface, fresh water 

springs, and monitoring wells that exceed primary and/or secondary MCLs. 

Exceeding primary MCLs presents a health risk to residents. Secondary MCLs 

are established only as guidelines to assist public water systems in managing their 

drinking water for aesthetic considerations and are not enforced by EPA. Neither 

the State nor EPA has conclusively determined the source of the contamination. 

Samples taken in October 2003 showed high levels of chlorides, arsenic, barium, 

and benzene. Test data also found fecal coliform and MTBE (methyl tertiary 

butyl ether), which do not have MCLs but pose health concerns. Based on these 

test results, the State advised the community to not use the water for domestic 

purposes. 

The Region stated that, in 2005, TCEQ detected lead and dichloromethane – both 

designated as hazardous substances under Federal Superfund laws. At the State’s 

request, EPA provided bottled drinking water to the affected residents under its 

Superfund authority. Although EPA officials told us that they believe the 

dichloromethane detection was due to a laboratory error, they have continued to 

provide bottled water. In response to a petition filed by Panola County residents 

in November 2006, EPA is conducting an assessment to determine if the site 

qualifies for cleanup under EPA’s Superfund program. 

Site Assessment/Remediation Efforts Not Yet Complete 

Although groundwater testing showed 

some contamination in 2002, the State 

did not issue an official notification until 

2003 that the groundwater was 

contaminated and should not be used for 

domestic purposes. Basic Energy 

Services began investigative and 

remedial activities immediately after the 

saltwater disposal facility closed in 

2004. After more than 3 years, the site 

investigation has not conclusively 

determined the source of the 

contamination. However, Region 6 is 

confident that, based on current 

sampling data, the contamination does 

not originate from injected waste. The 

Resident’s backyard well July 2005; water surface 

has oily sheen (EPA OIG photo) 

7 
full extent of the contamination, its lateral limits, its depth, and its migration 

patterns or movement along the groundwater plume is not known. 

The three monitoring wells installed by Basic Energy Services were not sufficient 

to characterize the extent and source of contamination. One of the wells was not 

properly sited, and collectively the three wells did not provide conclusive data to 

fully characterize the pollution at the site. One well was at the northeast portion 

of the site up-gradient to the general flow of the shallow groundwater. Any 

contaminated groundwater would flow away from that well and would likely not 

be detected. A second well was at the southwest site boundary near the 

residential community. A third well was further south of the second well along 

the southwest boundary and also nearer to the residential community. All three 

wells were located on the disposal site property. 

Between July 2005 and November 2005, the State installed five additional 

monitoring wells at the Mitchell site that will help better characterize the site. 

The State should continually assess the adequacy of data produced from these 

additional monitoring wells and ensure information received from them is 

adequate to categorize the site contaminants. 

Northeast corner of Mitchell Facility after 

closure (EPA OIG photo) 

Monitoring Well #1 (right bottom) with resident 

home in background (EPA OIG photo) 

State and EPA Determined Enforcement Action Was Not Appropriate 

Since the site’s closure in 2004, Basic Energy Services has not fully complied 

with State requests. The State has, on several occasions, directed it to install 

additional monitoring wells, conduct additional sampling and testing of the deeper 

groundwater, and provide a plan for the full remediation of the site. However, 

Basic Energy Services has not done so. 

For example, in March 2005, the State requested Basic Energy Services to assess 

the contamination at the Mitchell site, to include testing the deeper groundwater 

(about 180 feet) via the site’s previously operated freshwater well. Basic Energy 

8 
Services informed the State that it did not believe the contamination was its 

responsibility, and since the freshwater well had been plugged, deeper 

groundwater testing could not be conducted. In October 2005, the State directed 

Basic Energy Services to install two additional monitoring wells to delineate 

elevated barium and chlorides. Again, Basic Energy Services responded that it 

did not believe the barium and chlorides were related to its saltwater disposal 

operation and asked the State to reconsider its request for additional monitoring 

wells. In March 2006, the State indicated that Basic Energy Services’ 

performance was inadequate and it would take enforcement action. However, we 

found no evidence that the State had taken enforcement action. The State is now 

assessing and remediating the site under its State-managed Oilfield Cleanup and 

Site Remediation Program. 

EPA has also determined that it will not take enforcement action against Basic 

Energy Services. The Safe Drinking Water Act (Title 42, U.S. Code, Section 

300h-2) provides enforcement authority for the Underground Injection Control 

program. EPA has broad discretion about using its authority to take enforcement 

actions. EPA told us there is not sufficient evidence that subsurface injection 

contributed to the groundwater contamination. Therefore, EPA indicated no 

enforcement action can be pursued under the Safe Drinking Water Act. Region 6 

attorneys stated that the Region had not invoked its authority because (1) the 

groundwater data do not consistently show violation of a drinking water standard, 

(2) data do not exist to prove that contamination originated from a specific known 

source, and (3) there is no feasible respondent (responsible party) to whom an 

enforcement order could be sent. 

A Short-Term Solution Continues; EPA Conducts an Assessment 

EPA began providing bottled water for Panola County residents in September 

2005. In response to a request by TCEQ, EPA Region 6 established a contract 

with a drinking water distributor to provide bottled drinking water and dispensers 

to the affected residents. The Region indicated that bottled water would be 

provided to the affected residents until a permanent source of safe drinking water 

is obtained. The EPA On-Scene Coordinator reported that there is the potential 

that the contamination will spread to other families in the area. Therefore, the 

Agency would monitor the site for other residents with contaminated wells. The 

Region’s efforts are the first to provide any means of clean water for the Panola 

County residents since this situation began in 1996. 

EPA Region 6 has taken further action to assess the contamination. According to 

a Panola County resident, the Region had initiated action to assess the site under 

EPA’s Superfund program. In March 2007, residents told us that EPA had 

conducted what appeared to them to be a thorough investigation. 

9 
EPA Has Begun to Assert Its Oversight Authority 

Since December 2002, EPA has been working with the residents of Panola 

County. Prior to December 2002, EPA did not have significant contact with the 

Panola County residents. According to the Region 6 Regional Administrator, the 

Region did not initially become involved in the Panola County issue because it 

had no reason to believe the underground injection operation was responsible for 

residential well contamination. 

Since contamination was confirmed at the site in 2003, EPA has become more 

involved. During 2003 and 2004, Region 6 staff visited Texas State offices to 

review files, analyze lab results, and discuss ongoing efforts with State officials. 

The Regional Administrator noted that since 2005 Region 6 staff made multiple 

field trips to the site, conducted citizen interviews, reviewed additional site 

records, and analyzed site data. Region 6 staff added that because the 

Underground Injection Control program is delegated to Texas, it becomes 

involved in program issues only when necessary. However, although it has been 

3 years since official notification that the community’s groundwater was 

contaminated, the affected residents are still without a permanent source of safe 

drinking water. 

Conclusion 

EPA and the State of Texas have agreed to provide a permanent source of safe 

drinking water for the affected community. Specifically, in its June 29, 2007, 

response to our draft report, Region 6 said it intends to use removal action funds 

to pay for constructing a water line that will provide the residents with access to 

the Panola Bethany Water Supply Corporation. Further, the State and EPA are 

continuing to assess the source, extent, and severity of contamination. Region 6’s 

increased involvement since December 2002 is a positive step in identifying an 

affordable, permanent source of safe drinking water. Because of these positive 

actions, we are not making recommendations. The Region should continue the 

level of recent communication with the community until the project is completed. 

Region 6 Response to Draft Report and OIG Comment 

EPA is planning to take appropriate action to correct the problems noted in the 

affected Panola County community. Specifically, Region 6 indicated it intends to 

use removal action funds to pay for connecting the affected community to a water 

system. Region 6’s full response to our draft report is in Appendix B. Where we 

agreed with the Region’s position, we made appropriate changes to the report. 

Below, we provide information on issues for which we maintain our position and 

did not change the report. 

10 
Region 6 Response 

1. The Region stated that the report should state that “No groundwater 

contamination has occurred from injected waste.” It states that the draft report 

inaccurately suggests that injected waste from the Mitchell #2 well may have 

contaminated groundwater. The reply goes on to say both the Railroad 

Commission of Texas and EPA’s Underground Injection Control Oversight 

Program years ago determined that the Mitchell #2 injection well or AF Hall well 

were not the source of ground water contamination. 

OIG Comment 

While OIG cannot definitively determine where the contamination 

originated, we do agree with the Region that it is unlikely contamination 

originated from injected waste. 

Region 6 Response 

2. The Region took issue with the statement, "Region 6 personnel told us they 

believe evidence suggests the contamination does not originate from the injection 

site.” 

OIG Comment 

We changed the statement to read “Region 6 personnel told us they 

believe evidence shows the contamination does not originate from the 

injection well.” In fact, the Region concluded that contamination came 

from surface spills at the site. 

Region 6 Response 

3. The Region said that it believes the April 3, 2007, preliminary assessment 

report falsely concludes that contamination came from the injection well. 

OIG Comment 

OIG has not received a copy of, nor have we evaluated the conclusions 

reached in, the April 3, 2007, preliminary assessment report. Because we 

have not reviewed the report we are unable to evaluate the Region’s 

position. 

Region 6 Response 

4. The Region recognizes the difficulty in keeping various roles and 

responsibilities of its divisions and programs clear, and suggests this may have led 

us to incorrect conclusions about the Region’s oversight role. The Region also 

11 
takes issues with our characterization of its Underground Injection Control 

program. It added that, in fact, surface spills are not under the jurisdiction of the 

Underground Injection Control program. 

OIG Comment 

The OIG understands the Region’s organizational structure and each 

organization’s respective responsibilities. We believe that a more 

coordinated regional response may have led the Region to provide 

assistance to Panola County residents sooner than it did. We also believe 

it would be beneficial for Region 6's various divisions and programs to 

reassess their relationships with each other to better and more timely 

identify when issues such as this should be referred to other divisions or 

programs that could effectively deal with the problem. 

Region 6 Response 

5. The Region recommended that the OIG add a “current status” to the draft 

report highlighting the Region’s most recent accomplishments. 

OIG Comment 

We have added throughout the report comments describing the current 

situation and actions taken by Region 6. Preliminarily, Region 6 has 

determined that it will use removal action funds to provide 

uncontaminated water to the community by constructing a waterline from 

the Panola Bethany Water Supply Corporation to residents. Until 

completion of this project, Region 6 will continue to supply bottled water. 

Region 6 also indicated that it is now in regular communication with 

community residents. Contacts include frequent phone calls, emails, and 

two community meetings since December 2006. Superfund 

representatives have met individually with community residents in 

preparing for the Preliminary Assessment and Site Investigation and to 

explain test results. 

12 
Status of Recommendations and 

Potential Monetary Benefits 

POTENTIAL MONETARY 

RECOMMENDATIONS BENEFITS (in $000s) 

Planned 

Rec. Page Completion Claimed Agreed To 

No. No. Subject Status1 Action Official Date Amount Amount 

No recommendations 

1 O = recommendation is open with agreed-to corrective actions pending; 

C = recommendation is closed with all agreed-to actions completed; 

U = recommendation is undecided with resolution efforts in progress 

13 
Appendix A 

Details on Scope and Methodology 

Our review focused on allegations raised by the complainant. We conducted preliminary 

research to validate the allegations in the complaint, and used the preliminary research results to 

develop our objectives for field work. 

We visited the Panola County community in De Berry, Texas (to include the saltwater disposal 

well sites) and met with the residents of the community, including the complainant. We 

interviewed State headquarters and field office representatives at the Railroad Commission of 

Texas and TCEQ, including staff responsible for underground injection well operations and 

environmental protection. We interviewed EPA Region 6 staff members in the Source Water 

Protection Branch and the Superfund Division’s Emergency Response unit. We also met with an 

EPA Underground Injection Control specialist. 

To determine EPA’s and the State’s short- and long-term plans for providing safe drinking water 

to Panola County residents, we interviewed EPA and State staff members and sought to obtain 

documentation related to planning. 

To determine whether existing testing and sampling results were sufficient, we analyzed a 

compilation of all testing data from six testing episodes over a 3-year period. We used the most 

recent testing and sampling results (as of August 2005) as the basis for determining the presence 

and level of contaminants because these data are being accepted and used as reliable data by 

EPA Region 6 and State staff members. 

To determine whether EPA Region 6 provided adequate oversight of the Texas efforts at the site, 

we reviewed the specific requirements pertinent to EPA in the Safe Drinking Water Act. We 

interviewed EPA Region 6 and State representatives regarding EPA actions. Further, we 

reviewed EPA Region 6 Underground Injection Control program manager files and the Railroad 

Commission of Texas database for any documentation about EPA involvement with the site. 

14 
Appendix B 

Region 6 Response to Draft Report 

June 29, 2007 

MEMORANDUM 

SUBJECT: Comments on Second Draft Public Liaison Report “A Complete Assessment 

Needed to Ensure Rural Texas Community Has Safe Drinking Water” 

 Assignment No. 2005-1161 

FROM: Richard E. Greene 

 Regional Administrator (6RA) 

TO: Paul D. McKechnie 

Office of Inspector General (OIG) 

This memo provides our comments on the second draft report dated June 8, 2007. 

Generally, this draft is much improved over the first draft of September 26, 2006. We are 

particularly pleased that the first draft’s recommendations, which were based on questionable 

interpretations of the Safe Drinking Water Act, are not included in the second draft. We 

commend the thoughtful professionalism your legal staff exhibited in its discussions with 

Agency attorneys from the Regional and General Counsel Offices. The second draft still 

contains a few factual and technical errors, however: 

No ground water contamination has occurred from injected waste. The last 

paragraph on page seven and the first two paragraphs on page eight of the second draft report 

inaccurately suggest that waste injected in RB Mitchell #2 may have contaminated ground water. 

The second draft report then concludes that “[t]he State and EPA agree that further assessment 

[of potential contamination by injected waste] is necessary.” 

In fact, both the Railroad Commission of Texas (RRCT) and EPA’s Underground 

Injection Control (UIC) oversight program years ago determined that waste injection via RB 

Mitchell #2 or AF Hall #1B was not the source of ground water contamination, but have 

continued to review new data as it becomes available. The Region’s December 1, 2006 response 

(Response) to the first draft report addressed that issue on pages 9 - 11, explaining in detail why 

the Region concludes no such contamination has occurred. See Also Exhibit 1 to the Response, 

pp. 1, 13, 25 - 25, 29 - 30, 33, 34 - 35, 38 - 40, 43 - 45.1 Sampling data obtain since Region 6 

On page six, the second draft report inaccurately states, “Region 6 personnel told us they 

believe evidence suggests the contamination does not originate from the injection.” In fact, 

the Region’s first response instead indicated that surface spills at the site had contaminated 

ground water, but that such surface spills were not within UIC program oversight authority or 

responsibility. See, e.g., Response, pp. 3, 14. 

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submitted its Response to the first draft further confirms that injected waste has not contaminated 

the ground water at issue. We suggest references to potential contamination by injected waste be 

deleted from the final report. 

The preliminary assessment was released on April 3, 2007. That report, which was 

prepared by an EPA contractor, preliminarily concluded that the site’s ground water 

contamination stemmed from underground injection. The assessment did not receive a thorough 

EPA technical review before it was distributed. A review has now been conducted and shows 

that the contractor apparently failed to consider significant information and analysis 

independently generated by EPA Region 6 and RRCT. Although it noted other potential sources 

of contamination in the area, e.g., pipeline brine spills, the contractor apparently limited its 

consideration to the former R.B. Mitchell #2 Facility. Observing that the former surface site of 

the facility well had been remediated, the Contractor concluded that injected waste was the 

source of continuing ground water contamination without further analysis. Region 6 has 

informed Basic Energy Services of this error and plans to issue an accurate site investigation 

report in the near future. 

Region 6 is not now asserting “oversight authority.” The last paragraph on page ten of 

the second draft report suggests Region 6 has tardily asserted its “oversight authority,” 

essentially implying that the UIC oversight program failed to provide bottled water or conduct a 

preliminary site assessment until 2005 and 2006, respectively. We realize that keeping the 

respective authority and responsibilities of the three separate organizational units (Superfund 

Division, Water Quality Division, and Enforcement Division) that have been involved with this 

situation since early 2003 is difficult. Providing bottled water to the Panola residents and 

preparing a preliminary site assessment are not, however, UIC or any other program “oversight” 

actions. They are instead direct and independent actions of the Superfund program, which has 

no UIC program oversight responsibilities whatsoever over Texas state agencies. 

The Response described the UIC program’s oversight responsibilities on pp. 4-5 and the 

manner in which it carried them out on pp. 5-8, 15-16. See also Exhibit 1, pp. 5, 9, 11-13, 22-23, 

31, 47-49, 53-54. As pointed out in the Response, the UIC oversight program quickly reacted to 

its first notice (in December 20022

) of alleged Panola County ground water contamination by 

injected waste. Even though there was, and is, persuasive evidence that no such contamination 

by injected waste occurred, the UIC oversight program continued to monitor the situation. 

The second draft report continues to reference a hearsay report that a 1996 complaint 

was submitted to xxxxxxxxxxxxxx, an alleged EPA employee. Region 6 continues to believe 

Mr./Ms. Xxx xxxxxxxxxxx was not an EPA employee because its personnel records contain 

no mention of such a person and staff working in the Region in 1996 have no recollection of 

meeting him or her. See Response, Exhibit I, pp. 3. 

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The Second Draft Report should be updated to reflect the currently status of 

Superfund program efforts. The Region’s submission of the December 1, 2006, Response was 

its last substantive communication with Office of Inspector General technical staff. The 

Superfund program has preliminarily determined it appropriate to provide uncontaminated 

drinking water to the community and intends to use removal action funds to construct a waterline 

from the Panola Bethany Water Supply Corporation to transport such water to the community. 

Region 6 understands the community hs received funds from a settlement with Basic Energy 

Services and a grant that may be used to defray the costs of constructing hookups from the line 

EPA will construct to individual residences and structures. Until completion of this project, the 

Region will continue to provide bottled water to the community. The Superfund program is now 

preparing a comprehensive site investigation document that will provide a technical basis for 

those actions and plans to release that document in several weeks. 

The IG report indicated (page 11, “Conclusion”) that “More frequent communication 

between EPA and the community may also be beneficial.” Region 6 is in regular communication 

with the community via our program office contacts, as well as via the Office of Environmental 

Justice and Tribal Affairs. Contacts include frequent phone calls (several calls and or emails 

each week) and two community meetings since December 2006. In addition, Superfund program 

has met with the community members individually in preparation for the Preliminary 

Assessment and Site Investigation (PA/SI), to explain test results. 

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Appendix C 

Distribution 

Office of the Administrator 

Regional Administrator, Region 6 

Assistant Administrator, Office of Solid Waste and Emergency Response 

Assistant Administrator, Office of Water 

Agency Followup Official (the CFO) 

Agency Followup Coordinator 

General Counsel 

Audit Followup Coordinator, Office of Solid Waste and Emergency Response 

Audit Followup Coordinator, Office of Water 

Chief, Community Involvement and Outreach Branch, Office of Solid Waste and 

 Emergency Response 

Director, Office of Regional Operations 

Regional Audit Followup Coordinator, Region 6 

Regional Public Affairs Office, Region 6 

Assistant Regional Administrator, Water Quality Protection Division, Region 6 

Assistant Regional Administrator, Superfund Division, Region 6 

Associate Administrator for Congressional and Intergovernmental Relations 

Associate Administrator for Public Affairs 

Acting Inspector General 

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