VERTEX was retained by an international property and casualty insurance carrier to assist them in their review of claimed damages for remediation costs submitted by an insured pursuant to an environmental pollution insurance policy, pertaining to a segment of a crude oil gathering pipeline in Oklahoma.
In response to a significant petroleum release at a rural pipeline site, VERTEX was engaged to review proposed remediation activities and associated costs submitted as part of a pollution-related insurance claim.
In mid-2023, an anomaly was identified during a high-resolution in-line pipeline inspection. Upon excavation, petroleum-impacted soils and structural damage to the pipeline were observed. Further investigation revealed contamination within an estimated 55,000-square-foot area, with petroleum-impacted soil concentrated between approximately 15 and 45 feet below ground surface. Surface soils above 10–15 feet were found to be uncontaminated.
The remediation consultant proposed a multi-faceted approach to address the contamination, which included:
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Excavation of approximately 103,000 cubic yards of mixed clean and contaminated soil
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On-site treatment of approximately 53,000 cubic yards via mechanical shredding
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In-situ chemical oxidation (ISCO) treatment applied to approximately 8,000 cubic yards through targeted soil borings
The complex nature of the site, including varying contamination depths and the presence of multiple intersecting pipelines, warranted a combination of remedial techniques. VERTEX conducted a technical and financial review of the proposed activities and invoicing to assess cost reasonableness and alignment with regulatory closure standards.
VERTEX’s analysis concluded that while the proposed approach was generally appropriate for site conditions, several adjustments were warranted. The review led to:
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A reduction of over $1.2 million in claimed remediation costs through technical clarifications and coordination
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An additional $200,000 identified as non-environmental costs outside the defined scope of remediation
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An overall cost reduction of more than $1.4 million from the original amount submitted
VERTEX’s objective, expert review supported more accurate claim resolution and helped ensure costs were both reasonable and policy-compliant.
VERTEX helps insurance carriers and insureds navigate complex environmental claims through expert site inspections and cost reviews. Contact us today to ensure accurate, defensible outcomes.
