$1.7M penalty proposed in Exxon Yellowstone spill $1.7M penalty proposed in Exxon Yellowstone spill Oil swirls in a flooded gravel pit in Lockwood, Mont., after a pipeline break early Saturday, July 2, 2011. Federal pipeline regulators on Monday have proposed $1.7 million in penalties against Exxon Mobil Corp. for the pipeline rupture that spewed crude oil into Montana’s Yellowstone River. (AP File Photo/The Billings Gazette, Larry Mayer) MATTHEW BROWN| Associated Press March 25, 2013 Comments BILLINGS, Mont. (AP) — Federal pipeline regulators have proposed $1.7 million in penalties against Exxon Mobil Corp. for a pipeline rupture that spewed crude oil into Montana’s Yellowstone River. The U.S. Department of Transportation said in a notice sent to the company Monday that Exxon employees failed to close a valve that could have significantly reduced the size of the 63,000-gallon spill. The agency also faulted the company for not addressing flood risks or taking measures to prevent a spill into the scenic waterway. The July 2011 rupture of the 12-inch pipeline under the river near Laurel fouled 70 miles of the scenic Yellowstone’s banks, killing fish and wildlife and prompting a massive, months-long cleanup. Investigators previously said the size of the spill could have been reduced by about two-thirds if pipeline controllers had acted more quickly. In Monday’s notice, the agency said there had been “numerous indications” since the 20-year-old Silvertip pipeline was installed that is was in an area prone to seasonal flooding and erosion. Nevertheless, when the Yellowstone was flooding in 2011, Exxon chose to keep its pipeline operating even as at least one other company decided to shut down its pipeline in the same area, the agency said. Exxon’s “failure over an extended period of time to recognize those threats ... was a major cause of the failure,” the agency said. In a statement, Transportation Secretary Ray LaHood said his agency will hold companies accountable for adhering to federal safety standards. “It is our priority to ensure that America’s transportation system is the safest in the world,” LaHood said. Representatives of Exxon could not be reached immediately for comment. The Irving, Texas, company has previously acknowledged responsibility for the spill and pledged to work with state and federal officials to make sure the cleanup of the spilled crude is adequate. Exxon spent $135 million on its response to the spill, including cleanup and repair work. The spill helped prompted a national debate over the adequacy of federal regulations for the nation’s sprawling, 2.6 million mile network of gas and hazardous liquid pipelines.