U.S. super major
) has been fined $1.7 million by the U.S. Department of
Transportation, as per Reuters.
The regulators have charged ExxonMobil of violating pipeline
safety with respect to a 2011 oil spill in the Yellowstone River.
ExxonMobil's Silvertip pipeline spilled about 1,500 barrels of
oil into the river in Jul 2011, caused by heavy flooding in the
area. The pipeline used to transport 40,000 barrels of crude per
day in Montana.
Earlier, the company had stated that the mishap has cost
ExxonMobil around $135 million.
The U.S. Pipeline and Hazardous Material Safety Administration
(PHMSA) had initiated an enforcement action against ExxonMobil on
grounds of ignoring risks to the Silvertip pipeline system from
river flooding, scour and erosion.
The threats due to flooding on Yellowstone River were known to
possibly loosen the pipe's support and result in a rupture. The
accident would have been two-thirds smaller had the company
worked on these warnings before.
Further, the PHMSA also charged ExxonMobil on the context of its
failure to institute written emergency response plans for its
staff in the aftermath of a spill. The company has since bored
holes beneath the river to bury the pipeline deeper underneath
the surface. However, the company has not made any public comment
on the PHMSA decision so far.
ExxonMobil is the world's largest publicly traded oil company,
engaged in oil and natural gas exploration and production,
petroleum products refining and marketing, chemicals manufacture,
and other energy-related businesses. Approximately 83% of
ExxonMobil's earnings come from its operations outside the U.S.
ExxonMobil holds a Zacks Rank #3 (Hold). However, the Zacks
Ranked #1 stocks of
Stone Energy Corporation
Range Resources Corporation
EPL Oil & Gas, Inc.
) are expected to outperform the market over the next few months.
EPL OIL&GAS INC (EPL): Free Stock Analysis
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EXXON MOBIL CRP (XOM): Free Stock Analysis
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