Oil spill ‘a very disappointing incident,' says Algoma Steel CEO

The new boss at Algoma Steel spoke publicly today for the first time about last week’s oil spill in St. Marys River, calling it “a very disappointing incident” but providing no other details about how it happened.

Michael Garcia, who took over two weeks ago as Algoma Steel’s chief executive officer, was among company officials on a conference call Wednesday morning to discuss the steelmaker’s latest financial results. As SooToday reported yesterday, the company’s consolidated fourth-quarter revenue was $941.8 million, up 47.5 per cent from the same quarter last year.

Although most questions from industry analysts focused on Algoma’s finances, one participant did ask about the much-publicized oil spill. He wanted to know about potential fines, and whether Algoma’s insurance policies will cover the clean-up costs.

“We have had discussions with our insurance carriers,” Garcia responded. “I can’t share anything yet about what the final determination would be, and we also don’t have any colour around what the potential fines may be or the size of those fines. It was a very disappointing incident, and I would say that the source of the spill was safely contained, and all the appropriate officials were notified, and we’re working through all the next steps required. And that’s really all I can share right now. Thank you for the question.”

Garcia’s brief comment was the first from an Algoma Steel executive since the spill was first discovered on the morning of June 9—almost a week ago.

The substance that entered St. Marys River was Margoil, an oil used for lubricating heavy machinery. The U.S. Coast Guard said nearly 20,000 litres spilled into the water, but neither Algoma Steel nor the provincial environment ministry has confirmed that number.

In a written statement issued the day of the incident, the company only said: “A quantity of oil left our site early this morning and entered the adjacent waterway. The source of the spill has been safely contained.”

The high-profile mishap temporarily closed shipping traffic on St. Marys River between Ontario and Michigan’s Upper Peninsula. It also triggered a state of emergency downstream in Echo Bay, forcing the township to shut off its water intake system indefinitely. Water is now being trucked in for the 600 residents of Echo Bay until Algoma Public Health declares the water safe to drink again.

Although there is no risk to Sault Ste. Marie’s drinking water, Algoma Public Health is warning people not to drink, swim or bathe with the water from St. Marys. Pets and livestock should also avoid the river.

Algoma Steel issued another brief statement yesterday afternoon, saying it continues “to actively work with authorities, deploying equipment and resources, and conducting ongoing sampling and monitoring to mitigate any possible impact.”

The statement continued: “Our technical assessment of this incident continues as we seek to determine appropriate controls to prevent it from ever happening again. We remain committed to doing what needs to be done to protect the environment and continue to focus our efforts in this manner.”

The Ministry of Environment, Conservation and Parks says Algoma Steel must prepare and submit a report that outlines the cause of the spill and preventative measures for the future. It is not clear when the company must complete that report or whether the contents will be made public.