Day two of testimony before the Oil and Gas Commission continued Thursday in Columbus in the fight for reinstatement of injection well permits for D&L Engery.
D&L owner Ben Lupo, 61, of Poland, is facing federal criminal charges for ordering chemically-laced oilfield waste dumped down a storm sewer that led into the Mahoning River. Lupo, who owns D&L Energy, Hardrock Excavating and Mohawk Disposal, all of which share the same Salt Springs Road address, ordered Hardrock employee Michael Guesman, 31, of Cortland, to dump the oilfield waste into the storm sewer on Jan. 31 while investigators watched.
Officials with D&L are not disputing what Lupo did, but they believe he was acting on behalf of Hardrock, not D&L, at the time. They argued during Wednesday’s hearing that D&L should not be held liable for the actions of another company’s employee.
Representatives from the Ohio Attorney General’s offices on Thursday attempted to draw connections between the other companies Lupo owns. Much of the discussion focused on trucks that were used in the waste hauling and the markings on the vehicles. While the dumping contract was through Hardrock Excavating, the state testified that most trucks bore Mohawk Disposal logos.
Ohio Department of Natural Resources Inspector Steven Ochs testified about the night he caught employees dumping the chemically-laced oilfield waste into the storm sewer.
“I found a hose leading from one of the tanks to a storm drain with a grate laying on top of it,” said Ochs. “I looked inside and there was at least two feet of oil based drilling mud inside the basin.”
Lawyers with the state played a voicemail they said was a confession from Lupo. In the message Lupo said, “This is Ben Lupo. Give me a call. What happened here is all my fault.”
Lupo’s attorneys claim ODNR unlawfully revoked D&L Energy’s six injection well permits and denied three pending permit applications because D&L is a “sister” company and not a subsidiary or parent company to Hardrock and Mohawk. The commission is expected to make a decision in two to four weeks.
“You had an officer that was an officer in many companies and the chief of division of resource management blaming any company which he was an officer responsible for an intentional act that was not the responsibility of the other companies,” said D&L attorney Mike Cyphert.
They wrote Hardrock would financially benefit from improperly dumping waste because it’s a brine transportation company. But D&L, an injection well company, would receive no financial gain from the dump because the two companies deal with unrelated parts of the oil and gas industry. Attorneys wrote the D&L injection wells were available for the brine to be dumped into legally, showing that Lupo was only acting on Hardrock’s behalf.
During a three-hour cross examination Wednesday, Rick Simmers, chief of ODNR’s Division of Oil and Gas Resource Management, said his decision to revoke the permits was based on several factors, including logs by drivers hauling brine to the different well sites who said they were hauling for Mohawk, which was not authorized to transport brine water.
“Not necessarily any one person, focusing on all the data. A lot of people looking at large parts of the data,” said Simmers. “I was advised and I concluded that D&L had been party to the activity that we had witnessed.”