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DE 006829
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1200 . ZCanison 2Iroxt/nsvifft, Tt^as 78520
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DE 006830
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0E 006831
DE 006832
FACSIMILE TRANSMITTAL COVER SHEET
SENDING TO FACSIMILE NO. Ti'IX'?' 'S ! ~ C^r^P.i
TO: <W/3/h>>7 7.
_________________
CC:____________________________
PROM: RE: K-MiU 'YTtI/lJ.il .
OATE:
ofTotel number pages including this pacet
._
Call A'H
___________on telephone no. /* *
1 If you do not
receive All of the pages. Our Facsimile Number is 203-794*3133.
5055R/41
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DE 006833
22 S00
0S/2T/20
TO: B. Adler F. H. Cone
DATE: February 9, 1990
CC: B. Cortez
C. R. Kline J. Smith 0. B. Smith, II M. E.Tapp R. 1. Womack.
SUBJECT: Brownsville Site Exit Plan Update
In accordance with your request, I have prepared the following outline and summary of the continuation of our efforts to develop an optimal series of actions for the final closing of and withdrawal from the Brownsville Plant Site which meets corporate environmental policies, mlnlmizies (JCC&Ps long term risk, and evaluates the cost/benefit trade offs. This updated version was developed at a team meeting on January 30. 1990. The key plan components include the following activities:
Definition of the site soil and water condition.
Definition of a site remediation plan.
Disposition of the land upon which the plant facilities are located.
Disposition of buildings and structures.
Disposition of machinery and equipment.
Consideration of the above Issues in light of the ongoing litigation.
Preparation of two accruals, one for the ongoing commercial and legal activities and the other for all environmental activities.
The issues and actions associated with each of the above components are discussed below.
Set?
DE 006834
Hark Tapp estimates that the'effort to define the site, soil and ground water conditions and to develop a remediation plan will be completed by the end of 1993. During this period the site manning and resources should remain at current levels. The activities of one
employee. Dub Barnett, are solely devoted to environmental Issues and will be reflected in the budgets and accruals as such. After 1993, we will need to continue to have personnel at the site to manage the remediation projects and these costs will be Included in the environmental accrual once they are defined.
The Ball Mill Residue Basin Closure plan Is based on the continuation of a non-RECRA designation. Maintaining a non-RECRA designation is
critical to meeting the project's projected expenditures and timetable through 1994. During the closure of the Ball Hill Residue Basin, we
discovered that a significant portion of the waste appears to have been generated by Amoco. Further investigation of the site revealed additional areas within the plant containing Amoco generated waste. We plan to notify Amoco of our findings and request that they participate In the remediation.
'
Once the site, soil and water surveys are completed and the remediation plans are developed, the team will choose one of the several options for the disposition of the land upon which the plant is located. There are at least three options for the land disposition:
Terminate the lease and return the land to the Brownsville
Navigation District (BN0>.
",,
Continue to lease all or a portion of the site on a long term basis until remediation is completed.
Purchase all or appropriate portions, of the site.
Combinations of the above.
The choice of the land disposition option will depend on the balancing of the following considerations: remediation time, future land use, risk, and cost. Implementation of any option requires negotiation with the 6ND.
The Brownsville Plant environmental expenditure forecast is shown in Table 1. The forecast lists the various environmental projects and their anticipated expenditures through 1994. These expenditures total S8450M from January 1, 1990 through December 31, 1994. Future remediation costs will be projected for each project when defined. The remediation may take many years to complete depending on their nature.
RWL/5400m/2 2/9/90
DE 006835
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The action Hems developed for the environmental portion of the site exit
pi an 1nclude i
'
Actions
Prepare site maps (which are grided) showing:
Those areas we believe will require further study
Those areas were Amoco generated waste is located.
Those areas designated RECRA and non-RECRA.
Rasoonsibi11 tv A. 8ooth
Comp1tion pate
3/8/90
Prepare a letter to notify Amoco of their environmental responsibilities at the plant
site.
F. H. Cone/ B. Adler
Ask the real estate department for assistance R. W. Lasher/
in valuing the land at the plant site.
F. H. Cone
B. Disposition of the Structures Located on the Site
3/8/90 3/8/90
The disposition of the structures located on the plant site will depend upon the option choosen for disposal of the land. At a minimum, the translte buildings (which contain asbestos) should be removed and properly landfilled, along with any transit* siding. The concrete frames for the oxygen compressor building can remain on-site and
should be tested for waste products and remediated if necessary. The estimated cost of the translte removal and disposal is approximately $250M.
At the appropriate time, discussions should be held with the BND to determine those structures and equipment which may benefit the port such as docks and other general facilities. Obviously, if the land is
returned to the 8ND the permanent buildings will he part of the negotiated package.
The action items developed for disposition of the structures include:
Actions
Resoonslbl1itv
Completion Date
Explain the site exit plan to the BNO.
R. W. Lasher/ B. Cortez
When Appropriate
Determine if the BND wants the docks, equipment located on them and other general facilities.
R. H. Lasher/ B. COrtez
When Appropriate
Determine if the BNO is Interested in selling
the plant site and negotiate any land, building *
facility and other site Issues with the
8ND to achieve the exit plan.
R. M. Lasher/
B. Cortez
When Appropriate
i i
v?#5l
Actions
,
Investigate the remaining permanent
buildings for asbestos.
*
Oetermine If the BNO can use any clean concrete for fill.
C. Disposition of the Machinery and Equipment
Responsibility
B. Cortez
R. W. Lasher/ B. Cortez
Completion Date
4/2/90
When Appropriate
The team is of the opinion that the machinery and equipment located on the site should be dlsmantled-.and used'at another Union Carbide location or sold tothlrd parties and removed from the site. Theequipment dismantlement is to Include the removal and disposal of
asbestos installation and all other cleanup activities. Investment recovery will have the responsibility for this portion of the exit* . plan. Investment Recovery estimates.-the net dismantlement cost at S1255M. The basis for the cost estimate is shown In Table 3.
The timing of the dismantlement activities Is dependent upon the TexasSupreme Court ruling whether.they will'hear RIO's appeal of the trial and appellate courts' decisions, which held, as a matter of law, that
RIO Systems. Inc. has no right,- title or interest In the Brownsville Plant. The Texas Supreme' Court should rule by late March, 1990. This ruling Is the Key regarding UCC&P's undisputed ownership of the
plant. If the court chooses to hear.RIO's appeal then the timing of the dismantlement Is unKnown.' If the court denies to hear the appeal,
which Is the most HKely outcome, then the dismantlement can begin.
The actions required to initiate these activities are shown below:
Actions
Prepare a surplus property declaration. Include any environmental Issues associated with the dismantlement and specify disposal instructions.
Responsibility
B. Cortez/ M. Tapp
Completion Date
3/8/90
Investment Recovery will contract for the dismantlement and the sale or transfer of the equipment.
J. Smith
2Q90
Inform universal Process Equipment and Louisiana Chemical Equipment of the dismantlement plans.
R. H. Lasher
When Appropriate
3Z5&-. v-v*.
V-
DE 006837
o:f: Preparation of Accrual s'ffk^r
...
------------- ---..i*- -- -V*
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*
: Tha projected costs-associated wlth .the definition of the site soil
' and water conditions and the subsequent.definition of site remediation
plans are listed by project in an environmental accrual In Table 1.
The total cost is estimated at S8450M through 1994. This accrual does
not Include long term remediation activities which are not yet defined
and may continue into the 21st Century.
The activities at the plant site should switch from disposition of the
equipment, buildings and land to solely environmental activities by
the beginning of 1994. Consequently;- site activities other than
environmental are budgeted through 1993 at an estimated cost of
S6462M. Table 2 Itemizes these.costs while Table 3 Itemizes the
equipment and building dismantlement costs along with the key
assumptions.
;
E. Summary
The development and Implementation of a site exit plan for the Brownsville Plant requires coordination of many Interrelated
activities, several of which are outside of UCC&P's control. The environmental remediation plan must be accepted by the Texas Water Commission and will ultimately determine the duration of our presence on the site. The BND will play a role regarding the site disposition options and the associated cost, finally, the outcome of RIO's appeal to the Texas Supreme Court will determine the timing of the dismantling of the equipment and transite structures.
The plan will be updated as significant events occur and these activities and costs can be reasonably estimated so the accrual can be adjusted with some degree of precision.'
Best regards.
RWL/wg/S 5400ffl
D R. W. Lasher
J.
DE 006838
TABLE 1
Brow nsville Plant Environmental Forecast
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1989 Actual
Labor (Excludes Garnett)
$44
Contract Security Contract Services
152 l'i'9*
Utilities
20
Property Taxes
48
Lease Payments
102
Miscellaneous
2
Sub-Total
487 .
Litigation
398
Exxon Pipeline Lease
4,621
Dismantlement
Total
$5,108
1990 $47
k
162' 80 18. 48 102 17 474 400
2,760 755
$4,534
$M 1991 $50
1992 $53
1993 $53
Total i $203
172 127 M* 127
588
85 62 (* 62
289
20 10
10
58
48" \
6 **
6
108
102 ISO
150
504
10
10 j.>10
47
487 418
418 1,797
250 0
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-0 * ' '
0 0
650 2.760
500 1,255
$1,237
$418
$418
$6,462
<1) Reduce guard force by 2 full time guards. on evening, nights and weekends. <2) Brown & root reduced to 2 full time employees. (3) Taxes are estimated on my estimate of the value of the remaining
buildings - this might still be high. (4) Assumes favorable decision from Texas Supreme Court and trial court.
Costs projected for limited issues. (5) For 1990 through 1993 only.
RHL/2S59H/1 2/9/90
DE 006840
TABLE 3 Brownsville Dismantlement
Cost Estimate
Dismantle everything except brick and metal buildings, substations and the dock area. Fryablo asbestos and translte buildings will be removed and
properly landfilled.
Estimated Cost SM
Dismantlement Cost
Equipment & Scrap Credit Asbestos Removal Cost Translte Buildings Removal Cost Concrete Removal and Dlsosal Residual Product Removal andDisposal
Subtotal Contingency 9 lOt
Total
S755M
(700) 436 250 200 200
S1.141M 114
S1.255H
The project Is scheduled to be completed In 1991. See attached list of assumptions.
Wfi
RWL/2559H/2 2/9/90
006841