Kinder Morgan Bulk Terminals Inc, a subsidiary of Kinder Morgan Energy Partners announced that it has completed a settlement with the US Attorney's office for the district of Oregon and US department of justice regarding a former employee's involvement in the improper disposal of potash into the Pacific Ocean in 2003.

Potash arrives at Kinder Morgan's terminal in Portland via rail cars and is subsequently loaded onto bulk cargo vessels for shipment overseas. The incident occurred in August 2003 when the employee made arrangements to have a customer's shipment of potash, which had become wet and no longer met specifications for commercial use, improperly disposed of at sea without a permit.

As part of the settlement, the government and the company acknowledge in a joint factual statement filed with the court that

1. No harm was done to the environment

2. The former employee's action sees a violation of company policy

3. The company did not benefit financially from the incident

4. No Kinder Morgan personnel outside of the terminal either approved or had any knowledge of the former employee's arrangements

Kinder Morgan entered a plea to a criminal violation of the Ocean Dumping Act and will pay a USD 156,000 fine and make a USD 84,000 community service payment to the Oregon Governor's fund for the environment. The company initially announced this matter was under investigation in 2004, fully cooperated with the government's investigation and promptly adopted measures at the terminal to avoid future incidents of this nature.