Ashland Oil Inc.: Trouble At Floreffe

20 Pages 4885 Words

Intro/Facts

Ashland Oil, Inc. with revenues exceeding $7 Billion in 1987 was the sixtieth largest company in the country and the nation’s largest independent oil refiner. The company employed over 42,000 people worldwide and had refining capacity of 346,000 barrels of oil per day. Key oil supplies came from the Middle East and Nigeria, where Ashland Oil Inc. (AOI) had a long-term production contract. To reduce its dependence on the volatile refining industry, AOI had diversified into other energy-related activities such as petroleum product transportation and marketing; chemicals; coal; engineering and highway construction services; as well as oil and gas exploration and production operations. Oil refining remained the backbone of the business, however, with Ashland Petroleum Company (APC) representing about 30% of sales in 1987(1 Harvard pg. 2).

On January 2, 1988, a 4-million gallon oil storage tank owned by Ashland Oil Company, Inc., split apart and collapsed at an Ashland oil storage facility located in Floreffe, Pennsylvania, near the Monongahela River. The tank broke apart while being filled to capacity with diesel fuel for the first time after it had been dismantled and moved from an Ohio location and reassembled at the Floreffe facility. The mangled tank released diesel fuel over the tank's containment dikes, onto adjacent property, and into an uncapped storm drain that emptied directly into the river. Within minutes the diesel fuel had moved miles down river, washing over a series of dam locks and dispersing throughout the width and depth of the river. The oil was carried by the Monongahela River into the Ohio River, temporarily contaminating drinking water sources for area residents in Pennsylvania, West Virginia, and Ohio, contaminating river ecosystems, destroying wildlife, damaging private property, and adversely affecting businesses in the area.

Over the next three days following the spill, nearly 200 people co...