Oil company known as big polluter

LOS OLIVOS, Calif. - When a Firestone Vineyard employee discovered oil trickling down a creek in January in this wine country town, the source of the contamination was no surprise to firefighters.

Of 21 refineries in California, Greka Oil & Gas Inc. is the fourth-smallest producer, but the state's biggest inland oil polluter, according to state officials.

Broken pumps, busted pipes, overflowing ponds and cracked tanks at Greka installations have spilled more than a half-million gallons of oil and contaminated water since 1999, fouling the water, soil and air in the Southern California county many consider the birthplace of the nation's environmental movement.

Over the past nine years, the Santa Barbara County Fire Department has responded at least 400 times to oil spills and gas leaks at Greka, resulting in fines, citations, federal and local prosecutions and investigations by the Environmental Protection Agency and state Fish and Game.

"I've been in the hazardous materials business for 20 years and this is the worst oil company I've ever seen," said Robert Wise, who works at EPA's Superfund division.

The company says it is a victim of sabotage - a claim local and federal authorities dispute - and overzealous regulators.

"To say that Greka is a major polluter is a joke," said President Andrew deVegvar. "To the extent to which we're being portrayed as some kind of Darth Vader of the oil industry is not appropriate."

While the company has been fined more than $2.5 million over the years, authorities are losing patience with Greka. This winter the county Fire Department hit the company with stop-work orders against most of its operations.

Some conservationists and others suspect Greka's political connections - along with piecemeal regulation by overlapping agencies and weak inland oil spill laws - have allowed it to continue operating. Greka leases land from current and former county supervisors; another former supervisor is on the Greka payroll.

That the spills are happening in Santa Barbara County is perhaps the cruelest twist for environmentalists.

The mountainous coastal area dotted with boutique wineries and the ranches of President Reagan and Michael Jackson was a catalyst for the environmental movement. A disaster at a Union Oil Co. platform in 1969 coated miles of beaches with oil, killed thousands of birds and helped lead to the Clean Water Act and a moratorium on offshore drilling.

Greka set up shop in Santa Maria in 1999, taking over aging facilities from major oil companies and turning crude into asphalt and other products. From 1999 to 2007, the Santa Barbara Air Pollution Control District inspected Greka facilities 855 times and issued 298 violations. During that period, 203 Greka spills threatened or polluted state waters 20 times, according to Fish and Game.

"Right now I can't think of anybody that is worse than Greka," said Steve Edinger, assistant chief of Fish and Game. "They are the biggest inland oil pollution problem we are dealing with across California. Nobody has our attention like Greka does."

Authorities say Greka employees have been spotted covering up oil contamination with fresh dirt and were once caught plugging a corroded storage tank with a tree branch - accusations the company rejects. The district attorney cited Greka for 104 violations in 2004 after employees were allegedly caught trying to tamper with old pollution-belching engines. Greka settled with the county for $675,000.

DeVegvar has said the number of incidents is not out of line with those of other producers when looked at on a per-well basis. But the EPA's Wise said that is true only if Greka wells that aren't in use are counted, too.

Greka has spent tens of millions of dollars in upgrades, deVegvar said. The company recently said it was tightening security, and in January announced an environmental initiative dubbed Greka Green. But just a day later, it was hit with an 8,400-gallon spill.