WHITING - Amoco Oil Co. officials Wednesday acknowledged that a portion of

Northwest Indiana around its Whiting refinery sits atop a massive underground

sea of oil that has slowly accumulated through leaks and spills.

The enormity of the petroleum leaching through the soil in parts of Whiting,

Hammond and East Chicago was estimated by those officials at at least 16.8

million gallons -- roughly twice the amount of oil leaked into the sea in

Alaska by the Exxon Valdez two years ago.

While the threat posed by the oil in the sea is clear, what a 100-plus-year

accumulation of petroleum products under homes and businesses in three cities

means is unclear.

While Amoco officials told residents of the area in a letter delivered

Wednesday that they do not believe the pool of oil poses a particular threat,

the company did indicate it will attempt to clean up the mess.

The amount of leaked oil, equivalent to 400,000 barrels, is staggering. The

Valdez tanker spill in March 1989, at 10.9 million gallons, pales by comparison.

"It's massive; it's just massive," said the U.S. Environmental Protection

Agency's Kenneth Burch, manager of Illinois' underground storage tank program.

"Let's put it this way: The average underground storage tank at service

stations only holds 10,000 gallons."

Amoco Refinery Manager Frank Citek said oil started leaking as early as 100

years ago when wooden tank bottoms grew worn and hand gauges routinely

miscalculated tank levels. Tanks have since been replaced by all steel, and

monitoring is done electronically. Containment vessels installed along Amoco's

borders over recent years are designed to prevent additional oil from leaving

the property, Citek said.

In a letter hand-delivered Wednesday to the residents of some 500 homes,

Amoco said it "does not believe the situation poses an immediate safety or

health hazard for people living near the refinery." The company nonetheless is

seeking permission to sample the air in people's homes for explosive levels of

petroleum vapors and test the groundwater under the community.

Amoco Regulatory Director Patricia Wright said initial data indicate that

homes most likely do not harbor dangerous vapors, and the company does not

believe oil extends beyond the test area.

"In testing for oil, we have gone beyond what we think are our best

guesstimates of the area affected," Wright said. "We do think it's gone off our

property. Whether it's a few feet or a few blocks, we'll have to determine

that."

While there are stiff penalties for companies that leak petroleum products

into waterways, there are few statutes or regulations about spills like the one

at Amoco. If such a spill is proved a threat to surrounding residents, the EPA

and state agencies can act. However, any such action in this case could only

follow additional investigation.

Earlier this month, one Shrage Avenue resident reported a gasoline-like

stench in his home on the 2800 block. Fire and Amoco officials were called to

the scene and found a nearby curb drain filled to the brim with an oily

substance. Amoco is testing the material to determine whether it came from its

property.

And Indiana Department of Environmental Management records show that in

1984, residents of East Chicago's Marktown neighborhood reported strong

petroleum odors coming from storm sewers along several streets there. IDEM

questioned Amoco but officials could not determine whether petroleum had seeped

from the plant.

Amoco will use a system of recovery wells, wellpoints and so-called french

drains to recover the oil, including oil found beneath homes. Those

technologies can capture only 25 percent; the rest will be mopped through

several other methods, including naturally occurring bacteria enhanced with

nutrients and oxygen.

"I think it's very refreshing they have offered to do this," said Walter

Nied, an emergency response on-scene coordinator for the EPA in Chicago, who

confirmed Amoco's claim that the move to test the area and reclaim the oil is

voluntary. Federal laws regulating contamination cleanups exempt oil spills

unless they reach navigable waters.

Sandy Medley, Amoco's environmental coordinator, said tests show Amoco's oil

has not reached Lake Michigan to the north and George Lake Canal to the south

even though she pointed out that groundwater beneath the plant flows in several

directions, including north toward the lake and south toward the canal. Nied

said EPA tests show the canal is saturated with all kinds of contaminants,

including oil.

"We know there are large volumes of oil under the entire area," Nied said.

"Finally Amoco not only is going public (with its contribution to the problem),

but will evaluate if there is any impact on humans. The more they pump the

better it will be for people's health because benzene is a health threat."

Amoco also intends to test homes for the chemical benzene, a petroleum

byproduct that is released into the air primarily through the distribution and

use of petroleum products. The United States produces more benzene - 8 million

tons annually - than any other chemical. Long-term exposure in the workplace

can cause leukemia and high dosages are fatal. Most people are exposed to it

when they pump gasoline at service stations.

The EPA's Steve Faryan, another emergency responder, said companies involved

in reclaiming lost oil often paint a picture of doing it solely for the public

good. "They reclaim oil using wells, pump it through oil and water separators

and then put it back into refinery operations," he said.

"Amoco has been able to recover up to 1 percent of their fuel, which is

cost-effective because it pays back recovery costs." He added that recovering

lost oil has been part of Amoco's routine operations for years.

The company has slated two testing areas where it will scatter about 40

groundwater wells: one in Hammond and Whiting that is bounded by 129th Street

to the south, parts of Birch Street and New York Avenue to the west, 121st

Street to the north and company property to the east; the other in East Chicago

that extends just beyond the plant's southeastern fence line toward LTV Steel

Co. and the neighborhood of Marktown.

Jack Barnette, chief of the EPA's emergency response section, has said that

East Chicago, Whiting and Hammond, with their many oil and steel companies,

"sits on a sea of oil that's accumulated over the years," starting with the

open-pit storage of oil during World War II.

Heavy rains over past years have caused the groundwater table to rise,

lifting oil to drainage sewers that funnel it to area waterways.

Ron Novak, director of the Hammond Department of Environmental Management,

said he could not recall a larger underground leak than Amoco's that can be

tied to a single source.

People long feared that the former Energy Cooperative Inc. site south of

Amoco in East Chicago held about 50 million gallons. On Wednesday, EPA

officials whittled that estimate to 2 million gallons.

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