pollutants or ambient air quality standards or requiring adoption of stringent GHG reporting and control
programs or imposing restrictions on emissions of carbon dioxide in areas of the United States in which we
conduct business could adversely affect our cost of doing business and demand for the oil and gas we transport.
Our failure to comply with these requirements could subject us to monetary penalties, injunctions, conditions or
restrictions on operations, and potentially criminal enforcement actions. We may be required to incur certain
capital expenditures in the future for air pollution control equipment in connection with obtaining and
maintaining operating permits and approvals for air emissions.
In addition to the effects of regulation, the meteorological effects of global climate change could pose
additional risks to our operations, including physical damage risks associated with more frequent, more intense
storms and flooding, and could adversely affect the demand for our products.
Hazardous Substances and Waste
Our operations are subject to environmental laws and regulations relating to the management and release
of hazardous substances or solid wastes, including petroleum hydrocarbons. These laws generally regulate the
generation, storage, treatment, transportation and disposal of solid and hazardous waste, and may impose strict,
joint and several liability for the investigation and remediation of areas at a facility where hazardous substances
may have been released or disposed. For instance, the Comprehensive Environmental Response, Compensation,
and Liability Act, as amended, or CERCLA, also known as the Superfund law, and comparable state laws
impose liability, without regard to fault or the legality of the original conduct, on certain classes of persons that
contributed to the release of a hazardous substance into the environment. These persons include current and
prior owners or operators of the site where the release occurred and companies that disposed or arranged for the
disposal of the hazardous substances found at the site. Under CERCLA, these persons may be subject to joint
and several strict liability for the costs of cleaning up the hazardous substances that have been released into the
environment, for damages to natural resources and for the costs of certain health studies. CERCLA also
authorizes the EPA and, in some instances, third parties to act in response to threats to the public health or the
environment and to seek to recover from the responsible classes of persons the costs they incur. Despite the
“petroleum exclusion” of CERCLA Section 101(14) that currently encompasses natural gas, we may
nonetheless handle hazardous substances within the meaning of CERCLA, or similar state statutes, in the
course of our ordinary operations and, as a result, may be jointly and severally liable under CERCLA for all or
part of the costs required to clean up sites at which these hazardous substances have been released into the
environment.
We also generate solid wastes, including hazardous wastes that are subject to the requirements of the
Resource Conservation and Recovery Act, as amended, or RCRA, and comparable state statutes. While RCRA
regulates both solid and hazardous wastes, it imposes strict requirements on the generation, storage, treatment,
transportation and disposal of hazardous wastes. Certain petroleum production wastes are excluded from
RCRA’s hazardous waste regulations. However, it is possible that these wastes, which could include wastes
currently generated during our operations, will in the future be designated as hazardous wastes and therefore be
subject to more rigorous and costly disposal requirements. Any such changes in the laws and regulations could
have a material adverse effect on our maintenance capital expenditures and operating expenses.
We currently own or lease properties where petroleum hydrocarbons are being or have been handled for
many years. Although we have utilized operating and disposal practices that were standard in the industry at the
time, petroleum hydrocarbons or other wastes may have been disposed of or released on or under the properties
owned or leased by us or on or under the other locations where these petroleum hydrocarbons and wastes have
been taken for treatment or disposal. In addition, certain of these properties have been operated by third parties
whose treatment and disposal or release of petroleum hydrocarbons or other wastes was not under our control.
These properties and wastes disposed thereon may be subject to CERCLA, RCRA and analogous state laws.
Under these laws, we could be required to remove or remediate previously disposed wastes (including wastes
disposed of or released by prior owners or operators), to clean up contaminated property (including
contaminated groundwater) or to perform remedial operations to prevent future contamination. We are not
currently aware of any facts, events or conditions relating to the application of such requirements that could
reasonably have a material impact on our operations or financial condition.
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