Norfolk Southern CEO apologizes to Ohio townspeople, vows to “do what's right”
(Reuters) -Norfolk Southern will take responsibility for cleaning up the environmental damage from this month's train derailment and controlled detonation of hazardous materials in East Palestine, Ohio, its chief executive said on Wednesday.
The comments by CEO Alan Shaw to angry East Palestine residents in a CNN town call came a day after the U.S. Environmental Protection Agency ordered the rail operator to "pay for cleaning up the mess" created by toxic chemicals spewed into the air, water and soil on Feb. 3.
Shaw sat down with people from the town of 4,700 people for the CNN event, repeatedly apologizing and saying, "We're going to do what's right for the community."
U.S. and Ohio environmental regulators and the company hired experts who say testing shows the water and air are safe.
Incredulous residents, however, complain of ongoing chemical odors as well as nausea, rashes and other symptoms they believe are linked to the accident.
Shaw said the company had so far set aside a $7 million "down payment" to help the town recover and had sponsored the removal of 4,600 cubic yards of contaminated soil and 1.7 million gallons of polluted water.
Norfolk Southern reported net profit of $3.27 billion in 2022 when it paid nearly $1.2 billion in dividends to shareholders and bought back $3.1 billion worth of shares.
CNN host Jake Tapper also said the company has spent tens of millions of dollars lobbying for deregulation in the past two decades, a figure Shaw did not contest.
Norfolk Southern will quantify costs of the clean up no later than its first-quarter earnings, Chief Financial Officer Mark George earlier told an investor conference hosted by Barclays. Insurance will help offset those costs, including a liability policy that will cover up to $1.1 billion in certain situations.
The company also said in a statement on Wednesday it would excavate soil and replace tracks in the derailment area as part of a remediation plan that will also include sampling of soil and surface water.
That plan failed to assuage people in the CNN town hall, who peppered Shaw with questions about why the train that derailed continued to run even after signs the wheels were overheating, why the original remediation plan neglected to excavate soil beneath the tracks, and why train service resumed so quickly.
"I'm angry," said Jim Stewart, 65, who lives near the accident site.
Stewart said he was planning to sell his house so he could retire but now his property value had plummeted. "You seem like a sincere man. I'm not calling you names. But your company stinks."
Shaw said he could not comment on the accident pending an investigation by the National Transportation Safety Board (NTSB), which has said it would release a preliminary report on its initial findings on Thursday into the derailment.
U.S. Transportation Secretary Pete Buttigieg will travel to the site on Thursday to meet community members and attend a briefing on the investigation. He will be joined by representatives from the Federal Railroad Administration and Pipeline and Hazardous Materials Safety Administration.
(Reporting by Daniel Trotta in Carlsbad, Calif., Lisa Baertlein and Dan Whitcomb in Los Angeles, Nathan Gomes in Bengaluru, and David Shepardson in Washington, DC; Editing by David Gregorio, Himani Sarkar and Lincoln Feast.)