Petrochina Unit Fined for 2005 Toxic River Slick

Petrochina Unit Fined for 2005 Toxic River Slick

PlanetArk CHINA

29th January 2007

BEIJING - A unit of China's top oil and gas producer, PetroChina, has been fined for a toxic spill into the Songhua river that poisoned drinking water for millions of people, the Xinhua news agency said.

But the 1 million yuan (US$128,700) penalty -- the maximum allowed under Chinese law for environmental violations -- will be small change to a company that earned net profit of 80.6 billion yuan in the first half of last year.

An explosion at the Jilin Petrochemical company in November 2005 killed eight people and poured 100 tonnes of cancer-causing chemicals into the river, which flows across the country's northeastern border into Russia.

China initially covered up news of the disaster, but eventually cut off drinking water for days for about 3 million people in the downstream regional capital of Harbin and launched a massive clean-up operation.

Beijing subsequently pledged more openness and stricter standards, and fired or punished a string of officials including the head of the environmental watchdog, but no one has been prosecuted over the spill.

At PetroChina, 10 executives have received demerits on their personal record, Xinhua said.

China has vowed to clean up its environment, in part because of growing social unrest over pollution in rural areas.

But the State Environmental Protection Administration has limited power and is struggling to change the attitude of officials who have been told for years to focus on promoting economic growth at almost any cost.

Relatively small fines -- and a total cap rather than a daily charge for ongoing violations -- mean many firms find it cheaper to pay penalty charges than install and run cleaner equipment, Xinhua added. (US$1=7.768 Yuan)

REUTERS NEWS SERVICE