Terra Industries Inc. to Pay $625,000 Clean Air Act Penalty and Spend $17 Million to Install Pollution Controls

WASHINGTON – Terra Industries Inc., one of the nation’s largest producers of nitric acid and nitrogen fertilizers, has agreed to pay $625,000 in civil penalties to settle alleged violations of the federal Clean Air Act at nine of its plants in Iowa, Mississippi and Oklahoma, the U.S. Department of Justice and the U.S. Environmental Protection Agency (EPA) announced today.

As part of the settlement, Terra will also spend an estimated $17 million to install and implement new controls and technologies that are expected to reduce harmful nitrogen oxide emissions at its facilities by at least 1,200 tons per year.

“This agreement will require Terra Industries to make important improvements in pollution control technology at nine acid-producing facilities that will result in cleaner and healthier air for the benefit of communities in Iowa, Mississippi and Oklahoma,” said Ignacia S. Moreno, Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. “This is a notable achievement in our efforts, alongside the Environmental Protection Agency, to address the largest sources of harmful air pollution and bring about company-wide compliance with the Clean Air Act.”

“Illegal air pollution from the production of nitric acid can leave the public vulnerable to long-term health problems such as respiratory illness and asthma,” said Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance. “Bringing Terra into compliance with the Clean Air Act will protect the public health of communities across Iowa, Mississippi and Oklahoma.”

Terra is a major U.S. producer of nitrogen fertilizers, including anhydrous ammonia, urea, ammonia nitrate,and urea-ammonium nitrate (UAN). The company also produces nitric acid, a key intermediate in the manufacture of ammonium nitrate and UAN.

The production of nitric acid results in the emission of nitrogen oxides, which can cause lung damage, worsen respiratory diseases, contribute to acid rain and lead to the formation of smog.

Terra, headquartered in Sioux City, Iowa, will pay $325,000 to the United States and $100,000 each to Iowa, Mississippi and the Oklahoma Department of Environmental Quality – co-plaintiffs in the action filed today in U.S. District Court in Sioux City.

Terra’s nine plants covered by the settlement include four nitric acid plants at Yazoo City, Miss.; two each at Sergeant Bluff, Iowa, and Verdigris, Okla.; and one at Woodward, Okla.

According to the consent decree, Terra allegedly constructed, modified and operated its facilities without obtaining appropriate pre-construction and operating permits, and without installing best available control technology for controlling air pollution. Terra also allegedly violated the Clean Air Act by failing to comply with applicable air emission limits and ongoing requirements for emissions monitoring, recordkeeping and reporting at some of its facilities.

Reducing air pollution from the largest sources of emissions, including acid facilities, is one of EPA’s National Enforcement Initiatives for 2011-2013. The initiative continues EPA’s focus on improving compliance with the new source review provisions of the Clean Air Act among industries that have the potential to cause significant amounts of air pollution. In fiscal year 2010, EPA’s enforcement actions in the cement manufacturing, coal-fired power plant, glass and acid sectors led to approximately 370 million pounds of pollution reduced or treated, $1.4 billion in estimated pollution controls and $14 million in civil penalties.