Saturday, July 19, 2003

Marathon sued over pipeline dispute

By Charley Gillespie
The Associated Press

COLUMBUS - The former general contractor of an underground fuel pipeline across southern Ohio has sued Marathon Ashland Petroleum for terminating its contract.

A lawyer for H.L. Crouse Construction said Marathon Ashland unfairly terminated the company's contract after the U.S. Army Corps of Engineers halted construction on the $100 million pipeline July 2 because of environmental violations.

"We stopped the project for one day to attempt to negotiate the completion of the work and Marathon Ashland's reaction was to terminate the contract," lawyer Michael Currie said Friday.

The construction company, based in Perrysburg in northwest Ohio, filed a breach-of-contract suit July 11 in Hocking County Common Pleas Court asking for up to $10 million in compensatory damages and $7 million in punitive damages.

The company said the cleanup work to fix the violations added to cost overruns that Marathon Ashland refused to cover.

A spokeswoman for Marathon Ashland said Crouse voluntarily quit the job.

"We were disappointed when Crouse announced that they were voluntarily leaving the job," Jennifer Robinson said Friday. "They removed large equipment off the right of way. There was definite indication that they were leaving the job and it was voluntary."

Currie disagreed.

"We voluntarily shut the project down, but that is fundamentally different from saying you are not going to complete it," he said.

Robinson would not comment on the lawsuit.

"We are going to have to let this part play out in the courtroom," she said.

Crouse said the environmental violations were the result of faulty measures designed by Marathon Ashland.

Just 29 miles remained on the 149-mile pipeline when the Corps suspended Marathon Ashland's permit because of repeated environmental violations, including letting construction mud and sediment seep into waterways.

The pipeline is to cross eight Ohio counties, sending gasoline, diesel fuel, jet fuel and kerosene from a Marathon storage terminal in Kenova, W.Va., to a terminal in Columbus.

Robinson said the company is negotiating with another contractor, which is expected to "be on the job in a few days."

The lawsuit won't effect completion of the pipeline, she said.

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