2 consent agreement and proposed fi nal order for resolution of the RCRA violations for additional

context.

Public Comment: This document will be open for public comment from September 29, 2011 to October 31, 2011.

Name of Case:

In re BP Exploration (Alaska) Inc., BP Products North America Inc, BP West Coast Products LLC, and BP Corporation North America Inc

.

Docket Numbers of the Consent Agreemen ts and Proposed Final Orders:

SDWA-HQ-2011-5055 RCRA-HQ-2011-5054

Name and address of Complainant:

Adam M. Kushner, Director
Office of Civil Enforcement Office of Enforcement and Compliance Assurance U.S. Environmental Protection Agency 1200 Pennsylvania Avenue, NW Washington, DC 20460

Elliott J. Gilberg
Director
Office of Site Remediation Enforcement U.S. Environmental Protection Agency 1200 Pennsylvania Avenue, NW (MC: 2271A) Washington, DC 20460

Names and addresses of Respondents:

BP Exploration (Alaska) Inc.
900 East Benson Boulevard Anchorage, AK 99519

BP Products North America Inc.
501 Westlake Park Boulevard Houston, TX 77079

BP West Coast Products LLC 6 Centerpointe Drive La Palma, CA 906233 BP Corporation North America Inc.
501 Westlake Park Boulevard Houston, TX 77079

Location of the SDWA UIC Wells:

 One Class I non-hazardous waste injection well at Badami Oil Field (North Slope Alaska) located twenty -seven miles east of Prudhoe Bay Unit, on the North Slope of
Alaska.

 One Class I non-hazardous waste injection well at Milne Poin t Unit located northwest of Prudhoe Bay, on the North Slope of Alaska.

 Two Class I non-hazardous waste injection wells at Northstar Unit Oil Field located northwest of Prudhoe Bay, in the Beaufort Sea off the North Slope of Alaska.

 Three Class I non-hazardous waste injecti on wells at Prudhoe Bay Unit – Grind and Inject Area located on the North Slope of Alaska.

 Three Class I non-hazardous waste injection wells at Prudhoe Bay Unit Pad 3 located on the North Slope of Alaska.

Applicable Permit Numbers:

 The UIC well at Badami Oil Field operates under Permit No. AK-1I001-A.

 The UIC well at Milne Point Unit op erates under Permit No. AK-1I005-A.

 The UIC wells at Prudhoe Bay Unit – G& I operate under Permit No. AK-1I008-A.

 The UIC wells at Prudhoe Bay Unit – Pa d 3 operate under Permit No. AK-1I004-B.

 The UIC wells at Northstar Unit Oil Field operate under Permit No. AK-1I002-B.

Business/activity of Respondents: Produce, refine, or market oil and gas.

Description of Violations Alleged and Relief Sought:

BP Exploration (Alaska) Inc. is the oper ator of Class I non-hazardous waste injection wells subject to regulation under Pa rt C of the SDWA. BP Explora tion (Alaska) Inc., as well as
BP Products North America Inc. and BP West Co ast Products LLC, are also the owners and/or operators of hazardous waste management facilities subject to regulation under Subtitle C of

RCRA.

Sections 1423(a) and (c) of the SDWA, 42 U.S.C. §§ 300h-2(a) and (c), authorizes EPA to issue compliance orders and as sess penalties when EPA finds that a person is violating any requirement of a UIC program where a state does not have primary enforcement responsibility. BP Exploration (Alaska) Inc. operates ten Class I non-hazardous waste inj ection wells in Alaska (UIC Permit Numbers AK-1I001-A, AK-1I005- A, AK-1I008-A, AK-1I004-B, AK-1I002-B). Alaska does not have primacy over Class I non-ha zardous waste injection we lls. Therefore, the federal UIC program for Class I non-hazardous inj ection wells applies in the state of Alaska.

EPA determined that from 2006 to 2010, BP Explor ation (Alaska) Inc. failed to satisfy its SDWA financial assurance requirements for cl osing, including plugging and abandonment, its4 SDWA UIC wells in Alaska, as required unde r the applicable permits, SDWA Section 1421, 42 U.S.C. § 300h(b), and 40 C.F.R. Part 144, Subparts E and F. To secure its financial assurance obligation under the SDWA between 2006 and 2010, BP Exploration (Alaska) Inc. obtained written guarantees from BP Corpor ation North America Inc. BP Corporation North America Inc.
included documentation for financial test demons trations as part of the written guarantees provided on behalf of Respondents. As part of the financial test demonstrations, BP Corporation North America Inc. should have provided its most recent bond rating issued to it by Standard & Poor’s (“S&P”) or Moody’s. However, BP Cor poration North America Inc. did not use a current bond rating issued to it by S&P or Moody’s. BP Corporation North America Inc. instead listed a bond issued by another company, its wholly owned subsidiary, BP Capital Markets America Inc. BP Corporation North America Inc. did not ha ve an outstanding bond issu ance in its own name, as required by the financial assurance regulations.

EPA, as authorized by SDWA Section 1423( c), 42 U.S.C. § 300h-2( c), has assessed a civil penalty for these violations. For the SDWA settlement, Respondents have agreed to a civil penalty of $25,500. Also, to ensure compliance with the financial a ssurance requirements, Respondents have provided approximately $19.2 milli on in letters of credit for its SDWA UIC well closure, plugging, and abandonment obligations in Alaska.

During the same time period, from 2006 to 2010, EPA also determined that BP Exploration (Alaska) Inc., as well as BP Products North Amer ica Inc. and BP West Coast Products LLC, failed to satisfy the RCRA Subtitle C financial assurance re quirements for closure, post, closure, corrective action, and third party liability at their RCRA facilities in Alaska, California, Illinois, Indiana, Ohio, Texas, a nd Utah, as required under the applicable permits and/or orders for the facilities, RCRA Section 3004, 42 U.S.C. § 6924, 40 C.F.R. Parts 264, 265, and 267, Subparts H, and the corresponding state equi valent requirements. Section 3008(a) of RCRA, 42 U.S.C. § 6928(a), auth orizes EPA to issue compliance orders and assess penalties when EPA determines that a person is violati ng any requirement of RCR A. Section 3008(h) of RCRA, 42 U.S.C. § 6928(h), author izes EPA to issue orders requi ring corrective action or such other measures as EPA may deem necessary to pr otect human health or the environment and to assess penalties for noncompliance with such orders. To settle the RCRA matter, the respondents agreed to a civil penalty of $386,000. To meet their RCRA Subtitle C closure, postclosure, corrective action, and third party liability financial assurance obligations, Respondents also provided approximately $129.8 million in lette rs of credit, standby trust agreements, and
insurance for their RCRA Subtitle C facilities in Alaska, Californ ia, Illinois, Indiana, Ohio, Texas, and Utah.

Comments Accepted: EPA is providing public notice a nd an opportunity to comment on the proposed order for the resolution of the SDWA vi olations pursuant to Section 1423(c)(3)(B) of SDWA, 42 U.S.C. § 300h-2(c)(3)( B), and 40 C.F.R. § 22.45(b) and (c). In order to provide opportunity for public comment, EPA will not take fi nal action prior to forty days after the date
of notification of this action. In accordance with 40 C.F.R. § 22.45, persons wishing to comment on the SDWA portion of EPA’s proposed action ma y do so by submitting their name, complete mailing address and telephone number, along with wr itten comments, within thirty days of the date of this notice by the following methods.5 Instructions : Submit your comments, identified by Docket ID No. EPA-HQ-OECA-2011-0599, by one of the following methods:

 www.regulations.gov: Follow the on-line instructions for submitting comments.

 Email: docket.oeca@epa.gov, Attention Docket ID No. EPA-HQ-OECA-2011-0599.

 Fax: (202) 566-9744, Attention Do cket ID No. EPA-HQ-OECA-2011-0599.

 Mail: Enforcement and Compliance Docket Information Center, Environmental Protection Agency, Mailcode: 2822T, 1200 Pe nnsylvania Ave., NW, Washington, DC, 20460, Attention Docket ID No. EPA-HQ-OECA-2011-0599.

 Hand Delivery: Enforcement and Compliance Docket Information Center in the EPA Docket Center (EPA/DC), EPA West, Room B 3334, 1301 Constitution Avenue, NW, Washington, DC. The EPA Docket Center P ublic Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excludi ng legal holidays. The telephone number for the Reading Room is (202) 566-1744, and the telephone number for the Enforcement and Compliance Docket is (202) 566-1927. Su ch deliveries are only accepted during the Docket’s normal hours of operation, and sp ecial arrangements should be made for
deliveries of boxed information.

EPA’s policy is that all comments received wi ll be included in the public docket without change and may be made available online at www.regulations.gov, including any personal information provided, unless the comment include s information claimed to be Confidential Business Information (CBI) or other information w hose disclosure is restri cted by statute. Do not submit information that you consider to be CBI or otherwise protected through www.regulations.gov. The www.regulations.gov we bsite is an “anonymous access” system, which means EPA will not know your identity or c ontact information unless you provide it in the body of your comment. If you send an e-mail co mment directly to EPA without going through www.regulations.gov, your e-mail address will be auto matically captured and in cluded as part of the comment that is placed in the public doc ket and made available on the Internet. If you submit an electronic comment, EPA recommends th at you include your name and other contact information in the body of your comment and with any disk or CD-ROM you submit. If EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may not be able to consider your comment. Electronic files should a void the use of special characters, any form of encryption, and be free of any defects or viru ses. For additional information about EPA’s public docket, vi sit the EPA Docket Center homepage at http://www.epa.gov/epahome/dockets.htm.

Docket : All documents in the docket are listed in the www.regulations.gov index. Although listed in the index, some information is not public ly available, e.g., CBI or other information for which disclosure is restricted by statute. Certain other material , such as copyrighted material, will be publicly available only in hard copy. P ublicly available docket materials are available either electronically at www.regul ations.gov or in hard copy at the Enforcement and Compliance
Docket Information Center in the EPA Dock et Center (EPA/DC), EPA West, Room B 3334, 1301 Constitution Avenue, NW, Washington, DC. The EPA Docket Center Public Reading Room is open from 8:30 a.m. to 4:30 p.m., M onday through Friday, excluding legal holidays.6 The telephone number for the Reading Room is (202) 566-1744, and the telephone number for the Enforcement and Compliance Docket is (202) 566-1927.

For Further Information Contact : Cari Shiffman, Office of Civil Enforcement, U.S. Environmental Protection Agency, 1200 Pennsylva nia Avenue, N.W. (MC: 2249A), Washington, DC 20460; telephone: (202) 564-2898; fax: ( 202) 564-0022; e-mail: shiffman.cari@epa.gov.

Thor Cutler, U.S. Environmental Protection Agency, Region 10, 1200 Sixt h Avenue (MC: OCE127) (12th Floor), Seattle, WA 98101; telephone: (206) 553-1673; fax: (206) 553-8509; e-mail: cutler.thor@epa.gov.

A copy of the proposed order for the resolution of the SDWA violations is available for review and copying between the hours of 9:00 a.m-12:00 p.m. and 1:00 p.m.-4:00 p.m., Monday through Friday, at EPA’s Seattle Office Library (1200 Sixth Avenue, Suite 900, Seattle, Washington 98101) or upon request to Cari Shiffman (contact information listed above).