NOTICE OF VIOLATION

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To: Yockey Oil, Inc. CT Corporation System, R.A.

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Case Nos. 2001-11091-S and

2001-11092-S

Based on an investigations by a designated representative of the Indiana Department of Environmental Management (IDEM) on October 2 and 3, 2001, a crude oil well and/or ancillary equipment owned by Prime West Energy, Inc. (2001-11091-S) and managed by Yockey Oil, Inc. (2001-11092-S), located at the intersection of Broadway and County Line Road (Sec. 12 NE Twp. 7 S. Range 12 W.), Evansville, Posey County, Indiana ("Site") was in violation of the following environmental rules and statutes:

1. Pursuant to 327 IAC 2-1-6(a)(1), all waters at all times and at all places, including the mixing zone, shall meet the minimum conditions of being free from substances, materials, floating debris, oil, or scum attributable to municipal, industrial, agricultural, and other land use practices, or other discharges that will settle to form putrescent or otherwise objectionable deposits, that are in amounts sufficient to be unsightly or deleterious, that produce color, visible oil sheen, odor, or other conditions in such degree as to create a nuisance, which are in amounts sufficient to be acutely toxic to, or to otherwise severely injure or kill aquatic life, other animals, plants, or humans, and which are in concentrations or combinations that will cause or contribute to the growth of aquatic plants or algae to such a degree as to create a nuisance, be unsightly or otherwise impair the designated uses. During the above noted investigations, IDEM observed that Yockey Oil, Inc. and Prime West Energy, Inc. allowed the discharge of crude oil from the Site to waters of the state in violation of water quality standards.
2. Pursuant to 327 IAC 5-2-2, any discharge of pollutants into waters of the state as a point source discharge is prohibited, unless in conformity with a valid NPDES permit obtained prior to the discharge. During the above noted investigations, IDEM observed that Yockey Oil, Inc. and Prime West Energy, Inc. allowed the discharge of crude oil from the Site to waters of the state without a valid NPDES permit.
3. Pursuant to IC 13-18-4-5, it is unlawful for any person to throw, run, drain, or otherwise dispose into any of the streams or waters of this state, or to cause, permit, or suffer to be thrown, run, drained, allowed to seep, or otherwise disposed into any waters, any organic or inorganic matter that causes or contributes to a polluted condition of any waters, as determined by a rule of the board adopted under Sections 1 and 3 of this chapter. During the above noted investigations, IDEM observed that Yockey Oil, Inc. and Prime West Energy Inc. allowed the discharge of crude oil from the Site to waters of the state, in violation of 327 IAC 2-1-6(a)(1) and 327 IAC 5-2-2, which are rules adopted by the water pollution control board, and thus violated IC 13-30-2-1(1).
4. Pursuant to IC 13-30-2-1(1), no person may discharge, emit, cause, allow, or threaten to discharge, emit, cause, or allow any contaminant or waste, including any noxious odor, either alone or in combination with contaminants from other sources, into the environment or into any publicly owned treatment works in any form which causes or would cause pollution which violates or which would violate rules, standards, or discharge or emission requirements adopted by the appropriate board under the environmental management laws. During the above noted investigations, IDEM observed that Yockey Oil, Inc. and Prime West Energy Inc. allowed the discharge of crude oil from the Site to waters of the state, in violation of 327 IAC 2-1-6(a)(1) and 327 IAC 5-2-2, which are rules adopted by the water pollution control board, and thus violated IC 13-30-2-1(1).

In accordance with IC 13-30-3-3, the Commissioner is required to notify an alleged violator in writing that a violation may exist and offer an opportunity to enter into an Agreed Order providing for the actions required to correct the violations and for the payment of a civil penalty. The Commissioner is not required to extend this offer for more than sixty (60) days.

Entering into an Agreed Order will prevent the issuance of a Notice and Order of the Commissioner under IC 13-30-3-4, or the filing of a civil court action under IC 13-14-2-6. IDEM encourages settlement by Agreed Order, thereby saving time and resources. Timely settlement by Agreed Order may result in a reduced civil penalty. Settlement discussions will also allow the opportunity to present any mitigating factors that may be relevant to the violations. In addition, as provided in IC 13-30-3-3, an alleged violator may enter into an Agreed Order without admitting that the violation occurred.

If settlement is not reached within sixty (60) days of receipt of this Notice of Violation, the Commissioner may issue a Notice and Order containing the actions that must be taken to achieve compliance, the required time frames, and an appropriate civil penalty. Pursuant to IC 13-30-4-1, the Commissioner may assess penalties of up to $25,000 per day for each violation.

Please contact Dirk Andres at 317/233-5534 within fifteen (15) days after receipt of this Notice regarding your intent to settle this matter. If you are willing to resolve this matter as provided for in the enclosed Agreed Order, please sign and return it to the Office of Enforcement at the above address within the sixty (60) day settlement period.

For the Commissioner:

Signed on June 9, 2002

Date: _______________ _________________________

Felicia A. Robinson

Deputy Commissioner

for Legal Affairs

cc: Posey County Health Department

Jim Smith, Office of Land Quality (NRDA)/IGCN

Enforcement File

http://www.state.in.us/idem