Phillips 66 has agreed to a $500,000 penalty and to take steps toward reducing pollution in gasoline as part of a settlement with the U.S. Environmental Protection Agency.
The EPA said the Houston-based energy company that operates a 195,000-barrel-per-day refinery in Ponca City generated invalid sulfur credits between 2006 and 2012. The EPA also said the company failed to meet recordkeeping, reporting, sampling and testing requirements at refineries in Texas, Louisiana and Illinois.
Refiners can generate sulfur credits by producing gasoline that contains less sulfur than is required by the EPA. The credits can then be sold to other refiners, which use them to offset higher sulfur levels in their gasoline.
As part of the settlement, Phillips 66 agreed to retire more than 21 billion sulfur credits.
Phillips 66 said it met the requirements for earning the credits, but blamed the issue on record keeping.
“Sulfur credits can be generated by adding oxygenates to finished gasoline. During the years in question, oxygenates were, in fact, added to finished gasoline, making the nation’s gasoline pool cleaner. At issue was how the company tracked this oxygenate addition,” the company said in a statement Monday.