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Mill owner to pay $7.7M, apologize about emissions

The Associated Press

The Associated Press

PHOENIX – North Star Steel has agreed to publicly apologize and pay $7.7 million to settle allegations that it misled the state about emissions from the company’s mill near Kingman.

The company did not admit the allegations but “should have been more open” with state environmental regulators, North Star said in a settlement filed yesterday in Maricopa County Superior Court by state Attorney General Janet Napolitano.

North Star also said it “paid insufficient attention to important details” in the mill’s air-quality permit. The company promised to make sure that “serious deficiencies in the company’s business conduct will not be repeated.”

North Star, a unit of Minnetonka, Minn.-based Cargill Inc., agreed to pay $5 million in civil fines and $2.75 million to pave roads to reduce dust-induced health problems for area residents.

Company President James T. Thompson signed the settlement.

It was a “fair and equitable culmination” of the matter, he said in a separate statement.

The settlement requires North Star to publish an apology in the Kingman Daily Miner and have a top executive apologize in person to the Kingman City Council and the Mohave County Board of Supervisors.

In obtaining an environmental permit for its Kingman-area mill, North Star said the mill would use new technology that would reduce emissions during the melting of scrap steel for use in new steel products.

However, actual emissions of pollutants such as carbon monoxide have proved to be 15 to 50 times the limits imposed by the permit, Napolitano said.

The state’s investigation determined that North Star’s permit application was “inaccurate and misleading,” North Star failed to operate a device to control carbon monoxide emissions and conducted internal tests indicating that emissions were never in compliance, Napolitano said.

“The investigation also found that compliance with the permit would be impossible,” Napolitano said in a statement.

By saying emissions would be minimal, North Star was able to get a permit faster and beat a competitor, Atlanta-based Birmingham Steel, in a race to build a mill in Arizona, the office said.

Birmingham Steel got a state permit to build a mill west of Phoenix but it was under more restrictive environmental conditions than North Star received. After North Star got its permit, Birmingham abandoned its project.

In July 1998, the Arizona Department of Environmental Quality issued an order finding North Star Steel Arizona out of compliance with its permit.

North Star now is obtaining a more-stringent environmental permit, has complied with the 1998 order and has agreed to regular environmental audits, the department said in the settlement.

North Star encountered equipment problems after the mill started operations in 1996 but believed it could solve those problems, said Thompson, the company president.

“We lost sight of the high priority that the company places on environmental compliance,” Thompson said. “We thought we had purchased the very latest in emission control and energy-saving technology. It turned out we were wrong.”

North Star also operates mills in Beaumont, Texas; Calvert City, Ky.; Delta, Ohio; Duluth, Minn.; Houston; Monroe, Mich.; St. Paul, Minn.; Wilton, Iowa, and Youngstown, Ohio.

On the Web:

Attorney General’s office: http://www.attorney–general.state.az.us

North Star: http://www.northstarsteel.com

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