TALLAHASSEE — Federal and state environmental officials are negotiating a settlement with Mosaic, among the world’s largest fertilizer companies, over whether it mishandled hazardous waste at some of its Florida operations.
The issue could cost the company hundreds of millions of dollars in upgrades and trust fund payments in addition to a possible penalty of more than $1 million, according to state records and regulatory filings.
It’s part of the U.S. Environmental Protection Agency’s crackdown on hazardous waste created by the mineral processing industry.
“The negotiations involving Mosaic are complex and ongoing,” said company spokesman Richard Ghent. “We are negotiating in good faith and we look forward to a successful resolution of the matter.”
Phosphate ore is a mineral companies mine and process to produce fertilizer. A toxic byproduct created in the process is stored in piles up to 200 feet tall, called gypsum stacks or gypstacks. To some environmental groups, they are mountains of hazardous waste.
“They can sometimes overflow and spill their toxic waste after strong storms or prolonged rain events,” the Sierra Club Florida wrote in a brochure about gypstacks.
One example: In September 2004, hurricane-whipped winds churned waves of water over a gypsum stack in Riverview, opening a gap in the surrounding dike and spilling 65 million gallons of acidic wastewater into Tampa Bay — one of the worst local environmental disasters in memory.
The first Florida case settled under the EPA crackdown was in 2010 with CF Industries Inc., which agreed to spend $12 million to reduce the release of hazardous waste and pay a $700,000 fine.
Mosaic bought CF Industries three years later for $1.2 billion.
Negotiators and Mosaic officials are working to hammer out their own settlement now, but the issue could end up in federal court.
“A consent decree is currently actively being negotiated,” said Dee Ann Miller, a spokeswoman for the state Department of Environmental Protection. If no agreement is reached, officials would file a legal action in federal court.
In 2005 and 2006, the EPA issued Mosaic notices of violation related to the handling of contaminated process water at six of its operations: Riverview in Hillsborough County, and Green Bay, New Wales, Mulberry and Bartow in Polk County. As with other cases in the federal crackdown, the notices also were referred to the U.S. Justice Department for potential enforcement action.
In regulatory filings, Mosaic said it is pushing for a “negotiated resolution” but will go to court if needed.
“We intend to vigorously defend these matters in any enforcement actions that may be pursued,” read the company’s annual report filed with the Securities and Exchange Commissions.
The company says in the filings that a negotiation could include $150 million in upgrades and the placement of $625 million in an interest-earning trust fund to handle the gypsum stacks.
The trust fund payments would be a pre-payment to accelerate the closing of the gypstacks rather than allowing the company to pay for the process over the normal course of business, which it estimates would take up to 30 years.
Despite the hefty price of a potential settlement, Mosaic said in the filings it can easily absorb the cost because of “strong operating cash flows, liquidity and capital resources.”