The Metropolitan Water Reclamation District is looking to settle a five-year legal battle with Apex Oil over the fate of more than 2 million gallons of oil.
A settlement would return the oil to Apex Oil Company, and allow MWRD to lease valuable property at 3301 South Kedize Avenue, where the oil has been stored in tanks.
MWRD had leased an oil terminal, located on the South Kedzie property, to Torco Oil. In turn, Apex Oil Company stored roughly 2.4 million gallons of oil in tanks at the property that were leased from Torco.
After Torco went bankrupt, MWRD began eviction proceedings against the company in 2003. MWRD wanted Apex to clean the oil storage tanks but the company refused for a variety of reasons. MWRD then refused to release the oil.
Unable to reach an agreement, APEX took MWRD to court in 2004. Earlier this week, the board gave the authority to MWRD counsel to settle with Apex.
Terms of the settlement are still being discussed but MWRD has proposed to charge Apex, 17 cents per gallon for the removal of the oil, totaling $406,980.
“We would pay the 17 cents a gallon to get it out,” says Bill Dwyer, Apex general counsel.
MWRD wants to demolish the terminal and get this property back on the tax roll. MWRD awarded one demolition contract to Robinette Demolish Inc., as of Monday.
“We want to lease the property it’s valuable land,” says Pat Young spokeswoman for MWRD.
However, the property needs to be assessed before it can be leased, and before it can be assessed, the tanks need to be removed.
An additional demolition contract, for Omega Demolition Corporation, was up for vote but was differed because of contract negotiations.
“If they [Omega] do not have ownership of the oil, than they may not want to go forward with the contract of the demolition,” says Young.
Bill Dwyer, general counsel for Apex, says a contractor is imperative for removing the oil. Since Torco went bankrupt, the terminal has been destroyed by vandals and getting out the oil will be the biggest obstacle.
“This oil is very, very heavy grade it has to be heated almost 200 degrees in order for it to be pumped,” says Bill Dwyer, general counsel for Apex.
General Counsel Frederick Feldman for MWRD says, the contractor who is awarded the demolition contract will also remove the oil.
“The impression I get is that we’re fairly close to reaching an agreement,” says Feldman.