Beaumont, TX – Oil and gas giant Rowan Companies, Inc. faced significant penalties in 2008 following a federal investigation into routine environmental violations aboard its offshore drilling rig, the Midland, and at its berthing location in Sabine Pass, Texas. The case, prosecuted by the Department of Justice’s Environmental Crimes Section and the U.S. Attorney’s Offices for the Eastern Districts of Texas and Louisiana, revealed a pattern of illegal discharges into the Gulf of Mexico and the Sabine River, alongside a deliberate failure to report these actions to authorities.
Investigators discovered that between 2002 and 2004, crew members aboard the Midland routinely dumped waste hydraulic fluid, mixed with water, along with used paint, paint cans, and other pollutants directly into the Gulf. The Midland’s operations, particularly the maintenance of hydraulic cranes, generated substantial waste. Instead of proper disposal, this waste was simply pumped overboard. Further violations occurred when the rig was docked at Sabine Pass, where workers scraped paint and rust from the structure, allowing the resulting chips to fall directly into the waterway.
The investigation extended beyond Rowan itself, implicating several employees in the scheme. Hoover, Smith, Rawson, Friend, Freeman, James, Burcham, and Comardelle were all charged with various offenses related to the illegal discharges and cover-up. Burcham and Comardelle faced charges of misprision of a felony—knowingly concealing a crime—while others were accused of negligently violating the Clean Water Act. The prosecution highlighted a systemic failure within the company to adhere to environmental regulations and a conscious effort to avoid detection.
Legal Ramifications & Penalties
Rowan Companies pled guilty to multiple federal charges, including violations of Title 18 U.S. Criminal Code, 33 U.S.C. 1321(b)(5) for failure to notify authorities of the discharges, 33 U.S.C. 1311(a) and 33 U.S.C. 1319(c)(1)(A) relating to the knowing and negligent discharge of pollutants, and 33 U.S.C. 1908(a) under the Act to Prevent Pollution from Ships (APPS). As a result, Rowan was sentenced to three years of probation, a staggering $7 million in criminal fines, and a $1 million community service payment to the Southern Environmental Enforcement Network (SEEN) for environmental training and enforcement. An additional $1 million was directed to the National Marine Sanctuaries Foundation for preservation efforts at the Flower Garden and Stetson Banks National Marine Sanctuary.
Individual employees also faced consequences. Rawson, Smith, Hoover, Fox, and Friend each received 24 months probation, a $25 special assessment fee, and a $2,500 federal fine. James was sentenced to the same probation period but faced a $5,000 fine. Freeman received a $5,000 fine and Burcham a $5,000 fine with 36 months probation. Comardelle received 24 months probation and a $2,500 fine. The sentences underscore the government’s commitment to holding both corporations *and* individuals accountable for environmental crimes.
Future Compliance & Industry Impact
As part of its probation, Rowan was mandated to restructure its corporate organization to include a dedicated environmental division and implement a comprehensive environmental compliance plan. The company pledged to ensure all its rigs operating in U.S. waters would adhere to both U.S. and international environmental laws. Furthermore, Rowan agreed to collaborate with the Environmental Protection Agency and the Coast Guard to develop improved sandblasting techniques and establish new industry standards for minimizing and containing debris generated during offshore rig maintenance. This case served as a stark warning to the oil and gas industry, emphasizing the importance of environmental stewardship and strict adherence to regulatory requirements.
Key Facts
- Defendant: Rowan Companies, Inc.
- Crime: Illegal discharge of pollutants into the Gulf of Mexico and Sabine River, failure to report violations.
- Location: Gulf of Mexico & Sabine Pass, Texas
- Year: 2008
- Statutes Violated: 18 U.S.C. 4, 33 U.S.C. 1321(b)(5), 33 U.S.C. 1311(a), 33 U.S.C. 1319(c)(1)(A), 33 U.S.C. 1908(a)
- Penalties: $7 million in fines, $2 million in community service payments, 3 years probation for Rowan; individual fines and probation for employees.
- Investigation Agencies: EPA Criminal Investigation Division & Coast Guard Criminal Investigative Service
Source: EPA ECHO Enforcement Case Database
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