Koch Industries Responds to Rolling Stone – And We Answer Back

Let’s now address Koch’s bullet-points, in order:

Number One:

• Mr. Dickinson makes a number of broad negative claims about Koch’s environmental record, but only passing reference to the more than 900 awards for safety, environmental excellence, and community stewardship Koch has received since 2009 alone – information that we provided to Mr. Dickinson. In an article ostensibly about Koch’s relationship with regulators, the fact that EPA has repeatedly praised Koch for a productive and collaborative approach is surely relevant to Rolling Stone readers. In addition, he excised our explanation of the long and continuing path to improve and enhance our environmental, health, and safety performance. He also ignored the discussion about our ongoing efforts to ensure we understand and meet the expectations of the EPA and other regulators, our communities, and our shareholders.

Here Koch appears to be criticizing me for not adequately doing their own PR for them. The story clearly remarks on the culture change, circa 2000, that made environmental compliance a focus at Koch Industries and quotes Holden about the company’s quest for “10,000 percent” compliance. Given the company’s recent pollution woes it seems that Koch is falling far short of that standard.

Number Two: 

• While he never raised the issue with us, Mr. Dickinson refers to a University of Massachusetts-Amherst report from a radical group that names Koch as an alleged major “polluter” in the United States. Here again he omits key context to mislead readers. As we detailed here in a statement readily available to Mr. Dickinson, that report included virtually every major manufacturer in the United States today, which combined form the lifeblood of the economy and provide good-paying manufacturing jobs to millions of Americans. Moreover, the emissions cited in the report are legal and regulated by the Environmental Protection Agency (EPA). EPA itself notes that Toxic Release Inventory (TRI) information alone does not indicate that the use or release of these chemicals poses a risk. EPA has compiled TRI data for facilities with the same U.S.-based parent company. A parent company is defined as the highest-level company, located in the U.S., which owns at least 50 percent of the voting stock of the manufacturer. These parent companies are ranked by EPA based upon the total volume of production-related waste managed by those facilities. Koch Industries, Inc. is the parent company for the Koch companies. Due to the size and nature of our U.S.-based manufacturing presence, Koch has been among the top 10 parent companies for the last three years. More than 100 Koch company sites submit TRI reports—significantly more than the other top-10 parent companies, which have between 1 and 65 sites reporting.

Koch here characterizes The Political Economy Research Institute at the University of Massachusetts, Amherst as “a radical group.” The only radical thing that PERI does is compile facility-by-facility pollution data published by the Environmental Protection Agency and add it up. Based on a simple ranking of this federal data, Koch is, factually, one of America’s top air, water, and climate polluters.

Number Three:

• The article states that Koch made the difficult decision to convert a Flint Hills Resources refinery in North Pole, Alaska to a terminal, after “the discovery that a toxic solvent had leaked from the facility, fouling the town’s groundwater.” Mr. Dickinson ignored all the information we provide him on this topic. He deceptively omits the undisputed facts that the off-site contamination existed long before Koch bought the refinery in 2004, that the contamination was not disclosed to Koch by the prior owner, and that once discovered, Koch quickly and voluntarily began providing alternative water to the community. He also ignores that Alaskan public officials like Senator Mark Begich and Governor Sean Parnell empathized with Flint Hills’ difficult decision and that Flint Hills has worked to retain as many of the affected employees as possible at other Koch companies.

This is the North Pole discussion, see above.

Number Four:

• The article falsely claims that Koch’s petroleum coke business at its KCBX North facility in Chicago is endangering the “health of South Side residents,” despite the fact that we provided Mr. Dickinson the Congressional Research Service research, findings from the city of Chicago that “there are no known illnesses or health effects associated with pet coke dust,” and EPA’s own conclusion that “petroleum coke itself has a low level of toxicity and that there is no evidence of carcinogenicity.” Nor does Mr. Dickinson note that KCBX was honored with the Good Neighbor award from the Southeast Environmental Task Force in 2001 and again in 2005.

Here Koch disputes that petcoke poses a health risk. The characterization of harmful health effects in the piece comes directly from the Notice of Violation EPA sent Koch in June, citing micro-particulate air pollution emanating from Koch’s Chicago terminals — which sit near a little league baseball field and urban homes. It reads, in part, “Environmental Impact of Violations… • irritation of the airways, coughing, and difficulty breathing; • decreased lung function; • aggravated asthma; • chronic bronchitis; • irregular heartbeat; • nonfatal heart attacks; and • premature death in people with heart or lung disease.”

 Number Five:

• Mr. Dickinson rehashes regulatory and legal issues from the 1970s and 1980s regarding Nixon Administration price controls and oil lotteries that have long since been settled. In some instances, Mr. Dickinson fails to note the responses we provided him.

Koch disputes nothing here. Their unpublished responses were not quote worthy.

Number Six:

• The article falsely declares that Koch “stole” oil from American Indian lands in the 1970s and 1980s. In fact, no oil was “stolen” and there was no finding of theft of any kind in this case. We detailed this to Mr. Dickinson before publication and provided him with a statement and substantiation explaining the issue. He ignores all of it.

This regards Koch’s purchases of Native oil. Koch mischaracterizes and misquotes the piece here. In describing accusations of theft, the piece quotes directly either from the government record — including conclusions of a Senate Select Committee investigation — or sworn court testimony of a former Koch employee. The piece goes on to detail that Koch was never prosecuted criminally, but that a related civil case produced a large judgement against the company. This description is consistent with the factual record and with Koch’s prepublication remarks to Rolling Stone on the matter.

Number Seven:

• In discussing Koch facilities in Minnesota, Mr. Dickinson accuses us of “treating the Mississippi [River] as a sewer” during the 1990s. This is inaccurate and one-sided. In fact, between 1998 and 2001, Koch Petroleum Group entered into a series of agreements with the Minnesota Pollution Control Agency and EPA to resolve issues at Koch’s Rosemount, Minnesota refinery, taking full responsibility for past discharges from an aviation fuel tank leak, part of which reached a wetland adjacent to the Mississippi River, though not the river itself. We pointed Mr. Dickinson to the fact that our Minnesota refinery is recognized for its exemplary environmental performance, and its cooperative and productive relationships with regulators, environmental groups, and neighbors. His story omits these facts.

Here Koch is discussing its pollution record in Minnesota, although it seems fuzzy on the facts. The description of Koch using the Mississippi as a sewer comes not from the spill of aviation fuel in marshlands near the river, but from unmonitored wastewater dumps into the river. As recalled by the EPA: “In a separate offense, Koch dumped a million gallons of wastewater with high ammonia content on the ground between November 1996 and March 1997 and also increased its flow of wastewater into the Mississippi River on weekends when Koch did not monitor its discharges.”