In a decision that has broad implications, gasoline with additives such as lead is not included in the exemption under the Massachusetts remediation statute, Chapter 21E, for oil releases located in certain drinking water areas according to the Supreme Judicial Court’s decision upholding an interpretation by the MassDEP.
Under the state cleanup law, releases of oil in certain potential drinking water sources are subject to fewer requirements than releases of hazardous materials. MassDEP has interpreted this oil exemption to be limited to oil or gasoline without additives and not to include gasoline containing additives such as lead. An oil company, which was conducting cleanup of a leaded gasoline release, claimed the oil exemption on the basis that the definition of “oil” in M.G.L. c. 21E includes gasoline with additives. The decision by the top Massachusetts court on June 6, 2016, in Peterborough Oil Company, Inc. v. MassDEP could have broad implications for clean-ups that involve gasoline with other additives, such as MTBE.
The Court started with Chapter 21E’s definition of oil and concluded that the definition is ambiguous when the petroleum hydrocarbons are mixed with a hazardous material, such as lead. Having found that reference to CERCLA’s petroleum exclusion was of little help, the Court looked at the intent of the legislature to give MassDEP broad power to promulgate regulations to address sites and to compel the cleanup of sites, finding that interpreting “oil” when used in this exemption to include leaded gasoline would “eviscerate the legislative purpose.” Finally, the Court stated that MassDEP has consistently interpreted the oil exemption in this way. As such, the Court deferred to MassDEP’s interpretation of the oil exemption, holding that it is limited to petroleum hydrocarbons not mixed with hazardous materials such as lead.
The language of the decision raises broader concerns regarding the scope of the so-called petroleum exclusion under Chapter 21E, which provides more limited liability for releases of oil as compared to releases of hazardous materials. It has been well understood in Massachusetts that releases of gasoline are subject to the petroleum exclusion consistent with the underlying facts in Griffith v. New England Telephone & Telegraph Company, 414 Mass. 824 (1993). However, to the extent the gasoline contains additives such as lead – or MTBE – this is less certain under the language in Peterborough: “we are unable to read into the statutory language a plain indication that the Legislature meant to include leaded gasoline within the definition of ‘oil,’ where the definition also provides that lead is not an ‘oil.’”