Rawlins, Wyoming – Oklahoma-based oil and gas production company Nadel and Gussman Rockies LLC (NGR) has been slapped with over $1 million in fines, restitution, and community service payments following a 2011 crude oil spill near Rawlins, Wyoming. The company pled guilty to Clean Water Act (CWA) violations and faced sentencing earlier this year, marking the culmination of a joint investigation by the Environmental Protection Agency (EPA) and the Bureau of Land Management (BLM).
The incident, first discovered by a local resident in May 2011, involved the illegal discharge of approximately 4,746 gallons of crude oil into Emigrant Creek, a tributary of the North Platte River. Investigators determined that the spill stemmed from negligent practices at an NGR tank storage system. Patrick Ely, an independent contractor, was found to have been routinely draining production water directly onto the ground under the direction of NGR Operations Manager, Hugo Cartaya. This practice released an estimated 375,000 gallons of arsenic-laden production water alongside the crude oil.
What further complicated the case was NGR’s initial failure to report the spill to the proper authorities. According to EPA and BLM officials, the company only initiated cleanup efforts after being ordered to do so. This lack of transparency and immediate action drew sharp criticism from investigators, who emphasized the serious environmental risks posed by the discharge. Jeffrey Martinez, Special Agent in Charge of EPA’s criminal enforcement program in Wyoming, stated that NGR’s practices “put the environment at serious risk” and justified the substantial penalties levied against the company.
Financial Penalties and Restitution
U.S. District Judge Alan Johnson ordered NGR to pay a $357,500 criminal fine and $430,500 in restitution. A significant portion of the restitution – $200,000 – will be directed to the Oil Spill Liability Trust Fund, a federal resource dedicated to oil spill response and damage compensation. Carbon County, Wyoming, will receive $230,500, earmarked for oil spill response equipment and supplies ($80,500) and water quality/natural resource conservation within local conservation districts ($150,000). Additionally, NGR will contribute $212,000 in community service payments to the Yellowstone Park and Grand Teton National Park Foundations.
Individual Accountability
The investigation extended beyond NGR, leading to charges against Hugo Cartaya. Cartaya pled guilty to making false statements to both EPA and BLM agents during the criminal investigation and for violating reporting requirements under the Clean Water Act. He received three years of supervised probation, 250 hours of community service, and a $10,000 fine. The prosecution of Cartaya underscores the agencies’ commitment to holding individuals accountable for environmental crimes, not just the corporations they represent.
Legal Framework and Future Compliance
NGR’s violations included breaches of the Clean Water Act (33 U.S.C. 1321(b)(3)), making false statements (18 U.S.C. 1001(a)(2)), and violations of the Oil Pollution Act (33 U.S.C. 1319(c)(4)). The CWA prohibits the discharge of oil and hazardous substances into U.S. waterways in quantities that could harm the environment or public health. As part of the sentencing, NGR is also required to implement a comprehensive compliance program designed to prevent future environmental violations. Shannon Tokos, Chief of the BLM’s Special Investigation Group, affirmed that the case “demonstrates the BLM’s commitment to protecting natural resources and holding accountable those who would compromise the health of the public lands and waterways.”
Key Facts
- Defendant: Nadel and Gussman Rockies LLC (NGR)
- Location: Near Rawlins, Wyoming
- Date of Spill: April 2011
- Substance Released: Approximately 4,746 gallons of crude oil and 375,000 gallons of arsenic-laden production water
- Laws Violated: Clean Water Act (33 U.S.C. 1321(b)(3)), 18 U.S.C. 1001(a)(2), Oil Pollution Act (33 U.S.C. 1319(c)(4))
- Total Penalties: Over $1 million in fines, restitution, and community service payments
- Individual Charged: Hugo Cartaya (NGR Operations Manager) – pled guilty to false statements and CWA violations.
Source: EPA ECHO Enforcement Case Database
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