Can I Abandon an Underground Oil Tank?

When a homeowner converts to natural gas heating from oil, the assumption is that the tank must always be removed. However, there are situations where the disruption to the property makes it nearly impossible to remove the tank, or where the homeowner feels that it is not worth the time or the money to remove the existing tank. In these cases, homeowners do have the option to abandon the tank. However, be aware that abandoning a tank does not mean simply converting to natural gas and leaving a tank filled with oil in the ground or the basement. There is a process that must be undertaken to decommission any abandoned oil tank, and if not done properly, not only could there be natural consequences to the property, but there could also be financial ramifications down the road when attempting to sell your home.

Maintain Records On Your Abandonment

Should you choose to abandon your tank, it is imperative that you maintain records of all transactions and work done so that you can present them should you ever decide to sell your home. Realtors, lawyers, and insurance companies will not rely on your word that the tank on your property was properly decommissioned and abandoned. Contract negotiations have fallen through on many an undocumented, abandoned oil tank, you will need to provide paperwork to prove the work was done correctly if you ever find yourself in a situation where you are dealing with these types of professionals.

The first step in abandoning a tank is asking your current oil company to remove all of the oil from the tank and having the sludge removed. The oil company will likely cut a large opening in the top of the tank so that a human can crawl inside and wipe away the residue. The tank will then be filled with sand, pea gravel, or other environmentally friendly material. All connecting pipes will be disconnected and all remaining openings will be sealed.

So, the short answer is “yes.” Of course you can abandon an underground tank, but perhaps the better question is, should you?

An Underground Tank Can Affect Your Property Value

Abandoned tanks, even those that have been decommissioned (emptied and filled properly), can seriously affect home and property values. Many realtors advise their clients to either not consider purchasing a home with an abandoned tank, or to ask for money back in order to remedy the situation themselves, should they decide to pursue the home. Often, they will also make the contract for the sale contingent on having the tank decommissioned and removed prior to closing. While it is not required, by law, to remove an empty and filled tank, if at all possible, it is in the best interests of a home owner to have a tank removed.

Insurance Benefits

Insurance companies will also often offer reduction in payments to homeowners who have had oil tanks removed from the property, as it is truly the only way to ensure that there is no leftover spillage or leakage down the road which could lead to a much larger issue that the removal process. Oil companies, when emptying a tank, often leave approximately 50 gallons of fuel remaining in the tank so that they do not have to carry away the sludge that can gather in the tank. These 50 gallons can break down, over time, and find their way into the surrounding soil. Insurance companies, always looking to minimize the amount they will have to pay out to a homeowner over the life of the policy, look to reward forward thinking customers who are willing to remove a tank before it becomes an issue.

Many people choose to abandon their tanks at the time of conversion from oil to gas, only to find that they later need to have the tank removed as they attempt to build an addition on to their existing home, as the tank stands in the way of expanding the footprint of the structure. Removing the tank as soon as you have made the decision to move away from heating with oil is a preventative measure to ensure that any changes to your home can proceed without interruption.

While properly decommissioning and abandoning a tank removes the immediate problem, the only guarantee that your property is 100% safe from leakage is to have the tank removed. ERC’s up front flat rate will help ensure that the process is done correctly without the added stress of hidden fees.