Case Studies
Case #1: Expertise Gives A Convenient Remedy
A regional convenience store was purchasing an oilfield service facility with a truck repair shop. The shop bay had an engine oil change basement, which sloped about 5 feet into the concrete foundation. On the floor of the basement was a little oil stain. A prior inspection by a large environmental firm insisted that they should conduct deep soil borings through the foundation to inspect the soil underneath the basement for leakage. The owners were concerned about the expense, having been quoted a cost of about $15,000 just for the test corings. I come along at the request of the convenience store/buyer to render my thoughts. With all parties present, I simply suggested that owner clean the small stains on the basement floor, then fill the basement halfway with water. After a couple of days, observe any reduction of the water level. If there is no reduction, then the basement floor is not an issue for an oil leak.
Case #2: Recipe for a Successful Sale
My statewide banking client was going to finance the sale of a restaurant and the buyer (not the bank) ordered a Phase I from a large environmental firm. Upon completion, my banker read the report and questioned the recommendation of the firm that they inspect (“just to be sure”) an old groundwater monitor well that had been placed on the corner of the subject property about 15 years prior. The reason for the well was to monitor the groundwater for hydrocarbon contamination due to a leaking petroleum underground storage tank for a convenience store with gas pumps from across the street. My investigation revealed that the monitor well had been plugged about seven years ago and the well bore could not even be found on the surface. More importantly, the LPUST case had been closed for the same period as the monitor well plugged.
Case #3: Cut and Dry (Clean) Investigation
A 90-year-old gentleman wanted to sell his small commercial building in Fort Stockton, Texas (about 100 miles south of Midland). The buyer needed financing and went to a local bank, but it was affiliated with a larger bank in Lubbock. Both buyer and seller wanted to use me, but the bank in Lubbock, even though I had done work for them before, decided to call an environmental firm out of Dallas to travel to Ft Stockton (435 miles)! The buyer explained that while currently vacant, It was well known that for 10 years the building was used for a dry cleaning facility. The environmental professional for the firm strongly recommended soil corings to test for “perc”, a solvent now banned for use. The environmental professional did not interview the daughter of the owner, who had also operated the dry-cleaning service, and if so, would have discovered that the machines used a petroleum-based solvent- naphtha- and she had all sales receipts and machine records to back that up. Because she used a petroleum-based solvent with no evidence of stains or spillage, there would be no concern as to coring for perc in the building or around the soil of the building.
Case #4: The Mechanics of a Sensible Solution
An environmental firm was called to inspect a small, two bay auto mechanics shop in Dallas. A realtor friend that had the property listed called me when the potential buyer had an environmental firm in Dallas inspect the premises. Apparently, at the back part of the subject property, the mechanics had placed a 55-gallon drum in which to catch and store waste auto engine oil. They even had a brick spill containment feature around the drum. Now, after a week or so of heavy rains, the spill containment had filled to the brim with water and thus this small “waste oil storage area” overflowed onto the asphalt pavement. There was barely a trickle of water escaping, but there was a “sheen” on the water, but the water flow (and the sheen) did not even make it to the street’s storm water drainage system. But to be sure, the environmental professional recommended that soil testing was necessary for any oil that might have “leaked” under the asphalt. I wonder if some folks don’t realize what asphalt is made of.
Lessons To Be Learned
- Obviously, know your environmental professional or get recommendations from other real estate firms/developers, engineering firms etc;
- Insist on this provision when you commission an environmental professional- that he/she (or firm) will not perform any Phase II or Phase III services recommended upon the findings of the Phase I. If any such services are truly deemed necessary, another firm will be called to perform same.
I am in touch with many different environmental firms that provide these services, and my most favored recommendation for any environmental testing, cleanup etc is done by firms who do not solicit the Phase I ESA.
And a last, but important note- if your favorite environmental professional is not on your bank’s vendor list, insist that he or she be added. A good banking relationship should allow multiple environmental professionals for you to choose.
QUOTE
QUOTEThe climate alarmists look at the gun, the car, and the jet engine as instruments of Satan, but the mosquito has killed more than all three put together.”
– Jeremy Clarkson
Terms to Know:
Baseline Risk Assessment:
An inspection conducted by your environmental professional before the Phase I ESA to identify any issues that need to be cleaned up or remediated. After remediation has been completed, the cleanup can then be noted and final inspection for the Phase I ESA report can be completed.