The company sought to define its role in a growing public health concern marked by contaminated drinking water supplies—and accompanying litigation—around the country. The family of chemicals, known as PFAS, or per- or polyfluoroalkyl substances, have created liability concerns for Chemours.
The company is on “solid financial footing,” according to a Chemours presentation released Nov. 5. But some investors have told Bloomberg Environment those liabilities could be big enough to destabilize the company.
Chemours is a “minor player” in lawsuits involving PFOS, a type of PFAS commonly found in contamination resulting from the use of firefighting foam, the company’s CEO, Mark Vergnano, said during its third quarter earnings call Nov. 5.
Chemours’ potential contribution to PFOS in the environment through firefighting foams is “negligible, if at all,” the company said in its presentation.
However, the company also upped its own estimate of how much it will cost to fix its PFAS problems in documents it filed with the SEC later in the day. Chemours now believes it will ultimately need to pay out $884 million to resolve PFAS litigation and cleanup contaminated sites, a more than 10% increase from its estimate from one quarter ago.
Chemours Suit Against DuPont
The Environmental Protection Agency has yet to set drinking water limits for PFAS, but some states have taken steps to limit the public’s exposure through regulations and orders.
Chemours, in its earnings presentation, sought to clarify the differences between three substances in the PFAS family: PFOA, PFOS, and GenX, which is made at the company’s Fayetteville, N.C. facility.
The North Carolina Department of Environmental Protection ordered Chemours in February to install a thermal oxidizer that would reduce the company’s PFAS emissions. The unexpectedly high cost of controlling emissions at the Fayetteville facility was one of the reasons why Chemours sued E.I. du Pont de Nemours and Co., the company it spun off from in 2015.
DuPont and Chemours are involved in multidistrict litigation regarding PFOA in drinking water. The first trial is set for January.
“We continue to prepare to really be aggressive around driving that,” Vergnano said.
Hazardous Substances Under Superfund
The EPA is deciding whether to designate PFOA and PFOS as hazardous substances under Superfund law. If the chemicals gain that designation, the agency may be more likely to allocate federal funding and resources to PFAS-contaminated sites, helping states with the burden of tracking down entities to pay for cleanup.
PFAS chemicals are associated with adverse health effects, including developmental harm to fetuses, testicular and kidney cancers, liver tissue damage, immune system or thyroid effects, and changes in cholesterol, according to the EPA.
Though the agency has signaled its interest in a hazardous designation for PFAS under Superfund, and members of Congress are seeking the same designation, the necessary regulatory changes have not been made.
Chemours’ CEO declined to speculate on what such a designation would mean for the company’s liabilities.
“It would be very hard to speculate what that would mean in the future,” Vergnano said.
—With assistance from David Schultz.