by MARK REUTTER

     Faced with potentially huge environmental costs, Severstal North America has told regulators that it is not responsible for investigating or cleaning up Sparrows Point-related pollution that entered Baltimore harbor before the company purchased the steel plant in May 2008.

     The company’s objections threaten to delay action to reduce high levels of cancer-causing benzene that are being discharged into the harbor. Regulators say they do not expect the matter to be resolved until next month at the earliest.

     Severstal’s objections came in August in the wake of its admission, first publicly disclosed by The Brew,  that benzene and other toxic chemicals have been leaching into the harbor for years. The toxins come from an abandoned coke oven plant and are carried in groundwater streams beneath the steel plant into the harbor.

     Mittal Steel, prior owner of Sparrows Point, estimated that cleaning up the coke plant and related properties could top $42 million. Disposing thousands of tons of harbor sediment tainted by the benzene discharges could greatly add to the price tag.

     In August, the Maryland Department of the Environment (MDE) asked Severstal and Mittal Steel to fund a sediment study to determine how far pollution from the plant may have spread in the harbor. This opened up the possibility that the companies could be held responsible for cleaning up whatever tainted sediments were found.

     Severstal attorneys Scott R. Dismukes and Dale E. Papajcik objected to the scope of the request at a meeting with Matthew Zimmerman, Maryland assistant attorney general representing MDE.

     In a subsequent letter, Severstal asserted that while it was willing to investigate the impacts of current and future releases to offsite locations, it was “not responsible for any investigation or cleanup of historical off-site contamination.”

     Severstal claimed that the 2003 bankruptcy sale of Bethlehem Steel Corp. freed it from a 1997 court-ordered consent decree between Bethlehem Steel and regulators to clean up pollution at the plant.

     MDE and EPA have not yet responded to Severstal’s claims. They have scheduled a meeting next month to discuss the issue with the company.

     MDE officials, however, made available to The Brew a 2003 court document that committed International Steel Group, purchaser of Sparrows Point, to “all of the ongoing obligations of the [1997] Consent Decree.” John Lefler, then general manager of Sparrows Point, signed the document.

     Mittal Steel purchased ISG in 2005 and spun off Sparrows Point to Severstal in 2008. Typically, purchasers assume the environmental liabilities of sellers.

     Regulators are demanding that Severstal install groundwater pumps, vapor extractors and other measures to capture chemical contaminants from the groundwater before they reach the harbor. MDE recently expressed concern that “groundwater remediation is not being adequately and aggressively approached to prevent further offsite release of benzene and other contaminants.”

     Severstal spokesperson Bette Kovach and plant manager Thomas Russo have not responded to e-mail requests for comment on the groundwater controversy.

— Mark Reutter can be reached at reuttermark@yahoo.com