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Former D&L Energy Owner Gets Prison Time, Fine in Dumping Case

Ben W. Lupo, the embattled former owner of several Youngstown, OH-based oil and gas companies, was sentenced to 28 months in federal prison and a fine of $25,000 Tuesday for directing his employees to dump tens of thousands of gallons of oilfield waste down a storm drain that emptied into a major river.

The sentence, issued in a U.S. District Court in Cleveland, brings to an end a state and federal investigation that began in February 2013 after inspectors from the Ohio Department of Natural Resources received an anonymous tip about the dumping, which took place at the Youngstown headquarters of several companies owned by Lupo, including D&L Energy Inc.

Regulators discovered that Lupo had ordered his employees to dump tens of thousand of gallons of oilfield waste -- including brine water -- down the storm drain on dozens of occasions. The drain emptied into a tributary that fed the Mahoning River.

Less than a month after the dumping was discovered on Jan. 31, 2013, high-ranking federal and state officials, along with Ohio Attorney General Mike DeWine, visited Youngstown for a press conference in which they announced that Lupo would be charged with one count of violating the Clean Water Act (see Shale Daily, Feb. 19, 2013). Lupo pleaded guilty to those charges (see Shale Daily, March 25), and the incident stoked public outrage in the Youngstown area.

"Clean water and fresh air are not only important, they are the birthright of every man, woman and child in this great state," said U.S. Attorney for the Northern District of Ohio Steven Dettelbach after Lupo's sentencing. "Today's sentence was a significant sentence, but it was fully justified."

In February 2013, early on in a cleanup effort that took weeks, regulators said they had recovered approximately 40,000 gallons of oil and brine from the storm-sewer system. In an affidavit released at the time Lupo was charged, based on the sworn statements of David J. Barlow, a special agent with the U.S. Environmental Protection Agency's Criminal Investigation Division, one of Lupo's employees said Lupo had instructed dumps on as many as 20 separate occasions. The affidavit also revealed that nearly 60 storage tanks were located on the property.

But as the investigation progressed, regulators determined that the dumps were instructed on more than 30 occasions.

"Ben Lupo put his own interests ahead of everyone else's, and he deserved to face a severe penalty for his actions," DeWine said.

In court documents, Lupo's lawyers admitted that he was running out of waste storage after state regulators ordered an affiliate company's injection wells be shut down in and around Youngstown because one was linked to a 4.0 magnitude earthquake on New Year's Eve 2011 (see Shale Daily, Jan. 4, 2012).

After the sentencing, Lupo's lawyers released his first public statement since the incident in which he apologized to the community and admitted that his actions were “irresponsible and foolish.”

Federal prosecutors had pushed for the maximum sentence of up to three years in prison and a $250,000 fine (see Shale Daily, Aug. 1). It's been widely reported that Lupo, 64, has medical issues that the prison will now have to care for.

Both of the employees involved in the dumping incidents, Mark A. Goff and Michael P. Guesman, pleaded guilty and were sentenced to three years probation for cooperating with authorities. 

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