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Chesapeake Energy subsidiary levied $6.5mn fine

A subsidiary of Chesapeake Energy was fined $6.5 million to restore areas in West Virginia damaged by unauthorized discharges of fill material into stream and wetlands.

The U.S. Department of Justice and the U.S. Environmental Protection Agency said that Chesapeake Appalachia LLC impounded streams and discharged sand, dirt, rocks and other fill materials from 27 different sites – including 16 involving hydraulic fracturing – without a federal permit. The company will also pay a civil penalty of $3.2 million for violations of a section of the Clean Water Act which prohibits the filling or damming of wetlands, rivers, streams and other waters without a federal permit.

The settlement requires that the company fully restore the wetlands and streams, monitor the sites for up to 10 years and implement a comprehensive compliance program to ensure future compliance with the CWA. The settlement also resolves allegations brought by the state Department of Environmental Protection, which will receive half of the civil penalty.

In a related December 2012 case, the company pled guilty to three violations of the CWA related to natural gas extraction activity in Wetzel County, at one of the sites that is a part of the recent settlement. The company must pay a $600,000 penalty to the federal government for discharging crushed stone and gravel into a local stream to create a roadway to improve access to a drilling site.

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