Canadian Manufacturing

Hawaiian shipping firm Matson to pay US$15M for 2013 molasses spill

Matson is also agreeing to cease its molasses operation in Hawaii



HONOLULU—The biggest shipping company in Hawaii will end its molasses operation in the island state and pay millions of dollars as compensation for spilling 1,400 tons of the sugary substance in Honolulu Harbor.

State Attorney General Doug Chin called the $15.4 million settlement with Hawaii-based Matson Navigation Co. one of the largest for an environmental violation in Hawaii’s history.

Matson is also agreeing to cease its molasses operation in Hawaii and pay for removal of its molasses tanks and any remaining molasses, Chin said.

The company will pay $5.9 million to the state, and the costs related to ending the molasses operation are estimated between $5.5 million and $9.5 million, which would put the total settlement amount between $11.4 million and $15.4 million, Matson Inc. said in a statement.

“The range Matson provides in its press statement appears to reflect a desire to report a smaller loss to its investors for its next earnings report,” Chin said in response. “I have received assurances and the evidence strongly indicates that it will in fact cost $9.5 million for Matson to terminate its molasses operations in Hawaii.”

The 2013 spill killed more than 26,000 fish and other marine life. The molasses oozed from a section of pipe that Matson thought had been sealed. The sticky molasses suffocated marine life and discolored the water as it sank to the bottom of the harbour.

The spill, in an industrial area about 5 miles west of Waikiki’s hotels and beaches, shut down much of Honolulu Harbor for nearly two weeks.

Reaching a settlement allowed the state to avoid a lawsuit that would have taken years to resolve in court, Chin said.

Matson executives said previously that they weren’t prepared for the possibility of a spill, despite transporting molasses from the pipeline for about 30 years.
The $5.9 million paid to Hawaii includes money to help replace coral that had been damaged or destroyed. It will also reimburse the state for cleanup efforts and other costs.

“Matson has been a member of the community for more than a hundred years, and the company’s leadership understands the damage the molasses leak caused,” Gov. David Ige said in a statement. “The resolution allows reparations to occur now and helps see to it that such an environmental disaster does not happen again in Hawaii.”

Earlier this year, Matson Terminals Inc. pleaded guilty to federal criminal charges for illegally releasing the molasses into the harbour. As part of a plea deal, Matson agreed to pay fines and restitution totalling $1 million, including $600,000 that went to the Waikiki Aquarium and Sustainable Coastlines Hawaii.

“Environmental stewardship is a core value in our company, so this event was a blow to all of us at Matson,” President and CEO Matt Cox said in a statement. “We can’t take back what happened, but we’ve done our best to make it right.”

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