An oil company in Hart County has been ordered to pay a $100,000 fine after violating federal environmental laws for the second time.

Logsdon Valley Oil Inc. was assessed the fine Thursday in U.S. District Court for the Western District of Kentucky after admitting to a criminal count of violating an underground injection control program.

The charge against the company stemmed from a Sept. 13, 2019, incident related to the illegal disposal of byproducts during oil extraction.

According to court records, Logsdon Valley Oil pumped oil from a well for placement into a tank, and federal laws called for the proper disposal of water separated from the oil during the extraction process.

The produced brine water, containing benzene and bromide, is meant to be disposed by pumping it underground below a drinking water aquifer – or hauled away.

Logsdon Valley Oil, however, ran pipes from oil tanks to dispose of the wastewater into sinkholes, endangering a groundwater source and violating the federal Safe Drinking Water Act.

U.S. District Court Chief Judge Greg Stivers imposed the fine during a sentencing hearing Thursday, noting that company operator Charles Stinson had previously been fined $45,000 in 2014 and placed on probation for two years for a similar violation of the Safe Drinking Water Act that involved the improper injection of brine water from two oil leases into sinkholes and wells in Hart County between 2008 and 2012.

Stinson was charged again in the more recent case, but he died in 2023 and control of the company was passed to his wife, Ellen Stinson.

“Forty-five thousand dollars in 2014 was not enough to deter Mr. Stinson from engaging in this same kind of conduct,” Stivers said while imposing the $100,000 fine. “A fine of $100,000 is sufficient to deter other operators in this part of the state from intentionally thumbing their nose at the law.”

The maximum statutory penalty that the company faced was a $500,000 fine, but the $100,000 penalty imposed by Stivers matched the amount requested by Assistant U.S. Attorney Joshua Judd.

A sentencing memorandum filed by Judd cited the prior criminal case against Logsdon Valley and multiple instances of non-compliance with federal environmental regulations in requesting the $100,000 fine.

Ellen Stinson appeared at the sentencing hearing with her attorney, Brian Butler, who requested that the court levy a fine of $5,000.

Butler said that Stinson has cooperated with the federal Environmental Protection Agency to ensure that all the company’s oil leases were compliant with environmental regulations.

Stinson read from a brief statement at the hearing in which she pledged to continue cooperating with EPA officials.

“I believe in doing things as they should be done,” Stinson said. “I sincerely apologize to the court and the EPA for any problems they had with my late husband … I will continue to work with the EPA to the best of my ability and knowledge.”

Butler said that Ellen Stinson had little to do with the business prior to her husband’s death, but she accepted the responsibility of complying with an order entered in 2022 by the EPA that called for the plugging of two oil wells maintained by the company and the temporary abandonment of another well as Logsdon Oil formulated a plan to ensure no further violations ahead of future oil production.

A sentencing memorandum filed by Butler said that Logsdon Valley Oil has seven wells in operation, but only three are producing enough oil to ship, and the company is operating two EPA-approved injection wells and three disposal wells for brine water.

The well that was the subject of the criminal charge is no longer in operation, no EPA cleanup was required for the illegally disposed brine water and Stinson is attempting to sell the company, Butler said.

Court filings indicate that the Louisville EPA office received information in 2019 about the illegal injection of brine water into an unpermitted well, prompting an investigation.

Inspectors from the Kentucky Department of Gas went to the Hart County site on Sept. 13, 2019, and found a PVC line attached to a tank containing brine water extended into the nearby woods, spurting the water into a sinkhole and across the ground.

A former employee told investigators that Charles Stinson directed him to drain the produced fluid from oil tanks on one of the company’s oil leases into a field using a black hose, with the waste product eventually draining into a sinkhole.

According to court records, investigators estimated that between 4,000-5,000 gallons of produced fluid was released each night from the tank on what was known as the Billy Joe Caudill oil lease operated by Logsdon Valley.

Brine water produced from the Payton #7 East Lease, the subject of the criminal charge, traveled to a spring that discharged through underground streams into Green River, records show.