US proposes $1.7 million fine against ExxonMobil for Montana oil pipeline leak


US regulators proposed a $1.7 million fine against ExxonMobil late Monday, saying the oil company didn't do enough to prevent a 2011 pipeline leak that resulted in oil spilling into the Yellowstone River in Montana.

Exxon's Silvertip pipeline leaked more than 1,500 bbl of oil near Laurel, Mont., after heavy rains and flooding eroded the area around the 12-inch line. Oil was found along a 70-mile stretch along the river that required more than 1,000 people to clean up.

The US Pipeline and Hazardous Material Safety Administration, the federal agency that oversees pipeline safety, said Exxon didn't have written procedures instructing employees how to protect the pipeline in case of natural disasters.

"ExxonMobil failed to properly address known seasonal flooding risks to the safety of its pipeline system, including excessive river scour and erosion, and to implement measures that would have mitigated a spill into a waterway," PHMSA said in its allegations against Exxon, the largest US oil and natural gas producer.

PHMSA is also proposing Exxon be required to put in place a training program to teach employees how to react to emergencies at the company's pipelines.

Exxon was "disappointed in the findings of this report," company spokeswoman Rachael Moore said.

"We committed to learn from the incident and have since applied the learning to our remote control valve procedures and operator training," Ms. Moore said.

The proposed fine comes after Congress passed a law in 2012 that doubled the maximum values of fines for a related series of pipeline violations to $2 million.

Dow Jones Newswires

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