Hawaii company could play role in removal of Red Hill fuel amid water contamination

As the chorus of calls grows to drain the tanks at the Navy’s Red Hill Bulk Fuel Storage Facility, the question of what to do with the millions of gallons of petroleum now amassed at the fuel farm emerges as a front-and-center concern.

State officials have been discussing the possibility of using facilities maintained by fuel refinery and distribution company Par Hawaii to store some of it.

“We have been approached by state officials to offer support, and we are willing to do what we can to provide help for the Navy and the community,” said Eric Wright, Par Hawaii’s senior vice president and lead executive. “Once we understand the Navy’s plans, we will be able to offer recommendations to meet their needs while also addressing the community’s concerns.”

The Red Hill facility, which was built in the 1940s, can hold a maximum 250 million gallons of fuel in its 20 massive underground tanks. It is now the suspected source of contamination to the Navy’s water supply, which serves 93,000 people. Gov. David Ige and the state Department of Health have issued an emergency order that directs the Navy to remove the fuel from its tanks and cease operations until it can prove the facility can safely operate.

The Navy is contesting that order and, in particular, the requirement that it empty the tanks. Navy officials have stressed that the fuel facility is critical for national security and provides the war reserve fuel supply for the Indo-Pacific theater.

Still, calls to permanently shut down the tanks have come from elected officials, local residents and frustrated military families alike. But both state and military officials say that whatever happens next, the process needs to be a careful one to make sure a rushed effort doesn’t lead to more spills or contamination.

“Any movement of that amount of fuel — and we’re talking about well over 100 million gallons of fuel — would move slowly and safely to any number of places,” said Lt. Gov. Josh Green, who toured the facility earlier this month and met with Navy officials as acting governor.

“One discussion has already begun between the private sector, specifically Par Hawaii, and the Navy. That’s one part of the solution,” said Green. He asserted Par could hold as much as one-third of the fuel currently in the Red Hill tanks.

Par Hawaii operates a refinery in Campbell Industrial Park in Kapolei that is currently capable of producing gasoline, diesel, jet fuel, ship fuel and fuel oil for electrical power generation. Par executives say it offers total storage fuel capacity of 6 million barrels — or roughly 252 million gallons.

“The majority of this storage is used for fuel that we produce to meet the current demand of Hawaii residents; however, we estimate that a third of this storage, or 2 million barrels, could be available,” said Wright.

Navy officials have maintained that the Red Hill facility provides a critical fuel reserve for military operations in the Pacific, and stressed that the facility provides fuel to the Navy, Air Force, Army, Coast Guard and Hawaii National Guard through a series of pipes that move fuel from the facility to military sites around Oahu.

Navy officials said the Red Hill facility temporarily ceased fuel operations Nov. 27, shifting to above-ground tanks around the island. Green said that in addition to moving fuel to Par Hawaii facilities, the Navy could move volumes of its fuel reserve to those facilities.

“The Navy specifically is capable of storing tens of millions of gallons at its own facilities that are secure. And they do that already above ground — these are above-ground facilities,” Green said.

When asked earlier this month how long the military could rely on alternate systems, Navy Secretary Carlos Del Toro refused to say, citing national security concerns. While Green said he ultimately believes fuel needs to be moved above ground, he added that officials also need to make sure the military maintains its access to adequate fuel reserves.

“Our strategic response for the Pacific does hinge on us being able to deploy fuel to a number of ships across the Pacific, and that means that this is not an issue to trifle with,” Green said.

The Pentagon and the State Department increasingly consider the Pacific to be a top priority for the next decade as China and the United States compete for influence. The Pacific waterways that connect Asia to the global economy have increasingly been the site of geopolitical tensions and occasional confrontations.

The Navy has stepped up “freedom of navigation operations” throughout the region. Meanwhile, the Air Force has implemented a strategy it calls “Agile Combat Employment,” which involves frequently moving aircraft around airstrips spread across islands in the Pacific to make them harder to take out by missile strikes in the event of a conflict.

Conducting near-constant global operations requires a lot of fuel and has proved demanding for both the U.S. military’s ships and planes as well as the infrastructure that maintains them. The Navy’s ships have increasingly returned to port with visible rust as they struggle to meet grueling operational demands while aging shipyards try to meet maintenance demands.

The 80-year-old Red Hill facility has its own history of problems, with internal military reviews raising concerns about fuel leaks, ventilation and fire risks. But while the Red Hill reserve is part of the military’s operations, private-sector partnerships also play a key role.

According to data from the state’s Defense Economy Project, the Defense Logistics Agency paid Par Hawaii $1.7 million this year in fuel contracts.

“Over the years, we’ve worked with the Defense Logistics Agency and the Navy on a number of initiatives designed to increase capabilities and support military readiness,” said Wright. “They are familiar with our storage capabilities and have our commitment that we are always ready to support them and meet the needs of the broader community.”

Par and the Navy have at various points discussed deeper cooperation, including various fueling and bulk fuel storage options. Wright said Par Hawaii conducted a demonstration project in 2018 through which its refinery provided ship fuel to the Navy when docked at Barber’s Point Harbor in Kalaeloa. The project also involved using a floating buoy anchored about 1.5 miles offshore.

In a 2013 PowerPoint presentation, shown to military brass, the company — then known as Hawaii Independent Energy — made a similar pitch to the military on using above-ground tanks in Kapolei. The presentation, obtained by the Honolulu Star-Advertiser, boasted, “We have a long history of reliably producing military fuel grades,” and “we are here for the long haul, and have highly experienced work force, retained from prior owner.”

On Dec. 10, Pacific Fleet leaders told Hawaii lawmakers they believed a Nov. 20 spill of jet fuel caused the water contamination and that it had been isolated. But on Tuesday the Navy said a spill from May, which officials admitted may have been worse than they initially reported, could be the source.

“Par Hawaii is willing to be a part of the solution,” Wright said. “At this point we don’t know how much fuel storage would be required, but we’re willing to step in to help safely store the Navy’s fuel. It would require a contract between Par Hawaii and the Navy to move forward.”

The Navy built the Red Hill facility underground during World War II to make it harder for enemy forces to strike, and its operations remained largely secret for much of the Cold War. Today the facility’s location is well known, and modern “bunker buster” missiles can easily strike underground facilities. But the tanks, which are built over a critical aquifer, remain, and their unique architecture have made operations and maintenance difficult.

Regarding the way forward, Green said, “We really should spare no expense on the military side, to appropriate funds to help them move the fuel above ground, to store it safely and then to develop new plans with the Army Corps of Engineers and the EPA (U.S. Environmental Protection Agency) to not go down this path again.”