Oil tank abandoned (buried underground)?

Question

Anyone ever deal with an oil tank buried underground? Should I walk away from this deal? The sellers agent said it’s been cleaned out. I have never heard about this.￼￼￼￼

Lawrence P. Schnapf · Answer

Jim Windgassen- your experience is more typical of what i have seen. if the tank leaked and only contaminated soil, the cost can range from $15K to upward of $50K for larger tanks (usually associated with commercial buildings or multi-family). It is only when groundwater is impacted that is used for drinking purposes that the costs get into the six figures.

Russell Brazil · Answer

You can decommission an undergrou tank. Ask hem to provide any documentation about it. If they do not have it, then request that the tank be removed and for seller to provide soil sample test showing no contamination.

Jim Windgassen · Answer

@Simon Obas

I live in Chester, MD on Kent Island. I just finished having my 40 year old underground oil tank removed and replaced with a 275 gal above ground tank. The cost of removal and replacement was around $6200, however my old tank had leaked a substantial amount of oil into the ground which cost additional money.  The company used a meter to measure the contamination of the soil and kept digging until the soil was clear.  In the end, 27 tons of soil were hauled away and replaced with clean fill.  The additional remediation for the leaked oil cost an additional $6500.  Total cost of all this was $13,700 for a fairly modest amount of leaked oil.

If it were me, I would make my offer contingent on removal of the tank.  Filling the tank yourself with sand or gravel and saying it is abandoned is not sufficient to meet remediation requirements.  If you were to buy a property like this assuming everything was OK you might get a nasty financial surprise later.  I have a set of registered paperwork saying that my property is clean and clear of any environmental hazard.

Lawrence P. Schnapf · Answer

First- Home heating tanks are exempt from federal regulation and usually exempt from state regulation unless they exceed a certain capacity (typically 1,000 to 2,000 gallons). The typical home UST ranges from 250 or 500 gallons which tends to fall below the regulatory threshold. Usually, only heating oil USTs associated with commercial properties are regulated. thus, most home heating oil tanks may and often are taken out of service without any oversight from state regulators.

Second- the rules that are in effect for heating oil tanks are usually less stringent than for diesel or gasoline tanks since heating oil tends to thicker and may not migrate as far. as a result, many states just require tanks to be cleaned out. they may also require the tanks to be filled with sand or concrete to prevent collapse. but sampling may not be required.

Third- the key to determining if a tank has leaked is to collect soil samples from around and beneath the tank (groundwater also if groundwater is shallow). another quick way to see if a tank is leaking is to "dip" it with a stick that has a paste that turns color in the presence of water. generally, if water has gotten into a tank, it can mean oil has leaked out of the tank (although a certain amount of condensation may be present even where there is no leak so this is not a infallible test).

Fourth- if there is currently a tank in the basement, ask the owner if there used to be a buried tank (a/k/a underground storage tank).

Fifth, If the tank has impacted the soil, the cleanup generally varies from $25K to $50K though the costs will depend ont he depth of the contamination. i once had a home with a heated pool that had pressurized piping and used diesel. the contamination went down 40 feet and the consultant went crazy excavating the soil to the tune of $400K!!!

Finally, do use a tank contractor to investigate a home UST but instead an environmental consultant who understands the UST rules and regulations of the particular state.

Lawrence P. Schnapf · Answer

Simon Obas-   many states tend not to issue NFA letters for home heating oil tanks but some states allow licensed environmental consultants (not tank contractors!) to certify that the tank has been properly decommissioned.

The approach will depend on the state where the property is located. you may want to check with an environmental consultant in your state or a local environmental lawyer. if you let me know what state your dealing with, I might be able to recommend someone.

Account Closed · Answer

You need an NFA letter showing that the tank has no oil inside it.  Without this, you won't be able to sell the property.  And you will need to remove it the tank regardless. I have removed 6 old underground oil tanks and it is a flat fee of $1,800 here in NJ.  However, you need a permit and the town inspects it once the hole is dug, and if there is any smell or visible sign of oil you must stop and bring in another company to take soil samples and dig up all the soil that is contaminated.  This can cost anywhere from another few thousand to a few hundred thousand.  It normally costs about 5-10k in NJ to dig up the oil, but I have dealt with a bad oil contamination that cost 260k.  @Simon Obas

Louis Adimando · Answer

@Steve Morris this is a disaster to deal with if remediation wasn't properly completed and documented. Headache galore. Get your lawyer to request all documentation around decommission and have them review it before proceeding with a purchase.

Lawrence P. Schnapf · Answer

Here is the Conn website for residential heating oil tanks: https://portal.ct.gov/DEEP/Eme...  You can go to the Frequently Asked Questions page for more information. It contains recommendations for determining if a tank has leaked.

As you will see, Conn  DEEP does not regulate residential heating oil USTs used to heat four residential units or fewer. The Conn DEEP does not issue closure letters for residential cleanups. Some local fire marshalls may have records about these tanks.

Hope this helps..

Simon Obas · Answer

@Lawrence P. Schnapf thank you. I’m in Connecticut.

Steve Morris · Answer

You need an NFA letter showing that the tank has no oil inside it.

Good luck, getting those from your local govt (here in Portland METRO) takes lotsa time.

You lender will drive it, ask them what level they need.

Oil tank abandoned (buried underground)?

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