Exxon Mobil estimates Yellowstone spill will cost $42M

BILLINGS — Cleaning up tens of thousands of gallons of crude oil that spilled from a pipeline and fouled a popular stretch of Montana's Yellowstone River will cost Exxon Mobil an estimated $42.6 million, according to documents obtained Monday by The Associated Press.

About 42,000 gallons, or 1,000 barrels, of crude leaked into the waterway upstream of Billings, the state's most populous city, when the pipeline buried under the scenic river broke on July 1.

Exxon Mobil's cost estimate includes $40 million for emergency response work and $2.5 million for damage to public and private property. The company valued the lost oil at $100,000, according to documents submitted to federal pipeline regulators and obtained after a public information request.

AP Photo/Julie Jacobson, File

This July 10 photo shows the Yellowstone River flowing eastward past the Exxon Mobil refinery, in Laurel.

The documents also revealed that officials from the Pipeline and Hazardous Material Safety Administration reassured local officials that the pipeline would be able to hold up during flooding along the Yellowstone River in late spring. The pipeline failure occurred during a second round of flooding about a month later.

Despite reports of erosion along the riverbank where the pipeline crossed the Yellowstone, a PHMSA official said on June 1 that surveys by Exxon Mobil showed the line was buried at least five feet beneath the riverbed.

"The Yellowstone River crossing depth was surveyed last fall and is quite deep and should be adequate as long as the riverbank does not substantially erode and cause flooding in Riverside Park near Laurel," an agency official, Thomas Finch, wrote in an email to Kurt Markegard, director of public works for the city of Laurel.

After initially aiming to complete the work by Sept. 9, Exxon Mobil said last week the cleanup may continue for several more months. About 1,000 people are involved in mopping up the spill, which fouled dozens of miles of riverbank.

The company has declined to say how much the accident might cost. It was not immediately clear if the longer cleanup time was factored into the company's cost estimate, submitted July 29 in a report to pipeline safety regulators.

The pipeline agency recently approved Exxon Mobil's plans to replace the failed section of pipe by drilling a new line up to 30 feet deep beneath the riverbed.

PHMSA officials said in a statement that its engineers had completed an evaluation of Exxon Mobil's construction plan to ensure the newly constructed pipeline can operate safely.

An inspector will be present during the construction of the pipeline replacement, the agency said.