July 20, 2005

The Department of Environmental Quality announced today that an Administrative Order by Consent was reached with Farmers Petroleum, Inc. to resolve its past and future cleanup response activity costs at FPI’s formerly-owned Michigan sites.

FPI, formerly known as FPC Acquisition Sub, Inc., and Farmers Petroleum Cooperative, Inc., was a cooperative created in the late 1940s to provide goods and services, including the sale of petroleum products, to local farmers and the public at various locations across Michigan. Environmental concerns were first recognized when the company identified releases of gasoline at several of its retail distribution centers in the late 1980s and 1990s. FPI effectively stopped operation in 2001 when it sold most of its assets during a business consolidation, and eventually filed for bankruptcy. The State responded by making a claim for environmental cleanup costs at the FPI sites.

The settlement calls for FPI to release its remaining assets to the State in the amount of $838,234.70. The settlement amount includes a bankruptcy distribution from the liquidating trust in the amount of $768,234.70 and a separate payment of $70,000.00 resulting from the sale of FPI’s two remaining corporate land holdings. Additionally, permanent access agreements have been guaranteed with the DEQ at two of FPI’s formerly-owned facilities for the purpose of carrying out investigation and cleanup of the gasoline releases.

Editor’s note: DEQ news releases are available on the department’s Internet home page at www.michigan.gov/deq.

“Protecting Michigan’s Environment, Ensuring Michigan’s Future”

Revised July 20, 2005 by Pat Watson