If your home was built before the mid-1960s, there's a good chance it has an underground storage tank for the heating oil used
as the fuel for the furnace. This heating oil was usually stored in underground storage tanks (USTs) near the homes. Oil trucks would come to the homes and top off the USTs periodically during the winter months.
The Problem: Tanks Can Corrode & Leak Over Time
Over time, people switched to above-ground tanks or to electric furnaces or furnaces powered by natural gas. But the underground tanks still sit on the properties and may still have some oil in them. So what is the problem? Well, the tanks are made primarily of steel, which will corrode after about 20 or 30 years of use. Holes develop in the tanks, and the oil leaks out and contaminates the soil. It can even contaminate the groundwater and the drinking water.
In some cases, you may see signs of oil leakage. These include discolored soil that has a greenish-gray look, strong odors of petroleum, and dead vegetation. If you see signs of an oil leak, you must report the leak within 24 hours of discovery to the North Carolina Department of Environment and Natural Resources or be subject to possible fines. It is also possible to have soil contamination without any visible signs.
Some homeowners may not even be aware that there is a UST on their property, especially if the former owners removed the fill and vent pipes. But ignorance may not be bliss. If the soil is being contaminated by the UST, you will want to get the problem handled before the contamination becomes worse and the remediation costs more expensive. Also, it will be harder to sell your home if you have a UST on the property and cannot show that it has been properly removed and that the soil is free of contamination.
The Solution: Underground Storage Tank Removal
The best solution to the UST problem is to remove the tank. But don’t do that job yourself. If must be removed by a tank removal company that knows all of the regulations governing removal and disposal of these tanks. The soil should also be tested for contamination. If contamination exists, it should be properly remediated by an authorized company.
The state used to require soil clean-up if there was any indication of leakage in a soil test. Now, clean-up is only required if emergency risk factors (water contamination, fire or explosion hazard, or oil on the surface) are present. However, while the state may not require contamination clean-up, others might. Most insurance companies will not insure a property with a UST. Most lenders will require removal and clean-up before granting the mortgage loan. And, of course, smart buyers will require removal and remediation before closing on the property.
The state used to have a trust fund to help pay for some of the expenses involved with remediation of the soil. However, as of October 15, 2015, that trust fund is no longer available to help defray the costs. You will have to bear the burden.
Tips For Triangle Area Home Buyers and Sellers
If you believe that there could be a UST on your property, you should get an inspector to check for one. Then consult a tank removal and remediation company. At a minimum you will want to know if the tank is currently leaking and contaminating your property. It would be smart to have the tank removed and the contamination cleaned up. Failure to do so could make it much harder to sell your property.
If you are a buyer, be sure to ask about any USTs that may be on the property. If you want to purchase the property, get a UST inspection to make sure there isn’t a hidden tank on the property. Make sure your offer is conditional on the tank removal and soil remediation by the seller. You don’t want to be surprised by this issue down the road.
If you are considering buying or selling a home, send us a message or give us a call at 919-659-5173. My partner Andrew Palumbo and I both have extensive real estate and construction experience and we'd be happy to help you in any way we can.
Posted by Larry Tollen on
Given the potential cost for remediation in the event of contamination, it makes sense to have an inspection if there may be an old underground storage tank on my property. I would consider doing the job myself but it seems like a task that require more tools than I have at my disposal. I also lack the training needed to carefully remove the tank without causing additional contamination, which seems like it could be a likely risk to consider if the tank is outdated. Thanks for the helpful info.
Posted by John Carston on Thursday, June 23rd, 2016 at 11:14amJohn, under no circumstances should a buyer be doing thier own septic inspection unless they happen to be licenses wella nd septic inspectors. The tank isn't removed for an inspection but should be pumped (run don't walk from any inspector who suggests otherwise) generally speaking septic inspections including pumping run in the range of $500 - $600 but given the cost to install a new septic it's money well spent. Thanks for reading my article and taking the time to leave a comment.
Even if cleanup of oil spills from your UST are not required, it is probably a good idea to get the soil cleaned. The reason remediation is normally required is because the oil is hazardous. Why wouldn't you want to clean it up? It may not be a problem now, but could be in the future, so the simple solution is to clean it when it will be easiest to do so, when the tank is removed.
Posted by James Bergman on Tuesday, October 11th, 2016 at 5:22pmJames if the soil is contaminated then clean up is going to be required, though this can be expensive depending on how far the oil has spread, soil types etc. Homeowners with buried oil tanks are (in my opinion) better off being proactive and getting them out of the ground ASAP. If they still want to use fuel oil, my advice is to use a stainless steel above ground storage tank. If natural gas is available (in may rural locations this isn't an option) it would make sense to upgrade your heating system to natural gas as it tends to cost half as much to heat a home with gas as it does with oil. Larry Tollen
How do I find out if my tank was removed. Is there a data base or something? I would greatly appreciate any input.
Posted by Rhoda on Monday, May 8th, 2017 at 8:00pmRhonda, you need to contact your state environmental department.
1) If there's an underground tank in residential property and the tank is abandoned or removed, is there any problem with selling it?
Posted by Karen on Thursday, March 29th, 2018 at 8:10pmif so can you be more specific?
2) Do you have to test the soil? How much does that cost?
3) If soil is "contaminated", what is the limit or is there any limit to cost to remove it properly?
4) How bad could contamination be if say the tank was like 265 gallons or average size for small home?
5) What are repercussions if tank is about 20 feet from boundary with neighbor?
6) Is there any hope that the state will restore the trust fund to help defray these costs?
Stories I have read indicate that if you have a buried tank and if it leaked, remediation could be between $15,000 and $200,000.
Will check back for your reply, and thank you.
Karen, I'll answer your questions as best I can.
1 - If the tank was properly abandoned or removed; and signed off on by a licensed professional environmental engineer then there's no issue or impact when selling.
2 - Testing the soil is part of the process when abandoning or removing an underground storage tank. Prices can vary by location, you'll need to check with a local environmental engineer, but this typically isn't that expensive.
3 - If the soil is contaminated there is no "cost limit" it depends on a variety of factors including how much soil needs to be removed as well as a number of other factors specific to the job. This is beyond my scope of expertise and is job specific.
4 - No idea how to answer this question, as typically tanks aren't full when they are abandoned and whether it's leaked or not, and the severity of the leak as well as the amount that may have leaked are unknown. Again this is something an environmental engineer will need to answer for you.
5 - The biggest concern is likely to be whether the tank leaked and if it may have contaminated a neighbors well.
6- I would bet against it. The state's money came from the Feds and I believe the fund is exhausted.
I don't know where you're located if you are in the Raleigh, Durham, Greensboro area I would suggest contacting Mark Hosler at Sensible Solutions. http://www.sensible-solutions-environmental.com/
Hope this helps.
Hi, Thanks for your advice. I just made an offer on a house and it was accepted. They currently have an oil furnace and the tank is buried. No visible signs of leaks. I want to buy a natural gas furnace and decomission the oil tank. I am trying to figure out the correct order so that my costs are minimized. I also didn't realize the problem with buried oil tanks until after my offer was accepted and I started looking into getting a natural gas furnace and switching. The house was built in 1964 and I am assuming that the tank was buried then. I want to get it tested to find out if there are leaks BEFORE the sale goes through, but I will want it "abandoned" correctly if there are no leaks. Abandoned costs less than removal. But if they do the testing separately, sounds like I would be doubling the costs. Also, the furnace has to be hooked up and working when the appraiser comes for them to okay the loan. The general house inspector is coming thursday. My agent is going to try to line up an oil tank inspection/soil testing separately, which sounds like it could be $500 too $600. Do you have any advice about the best order to do these things? If there are leaks, then that is going to be a big mess and I am not sure what the owner will want to do. She might want to sell as is because the market in Asheville is so hot right now. My agent is trying to miminize the risks. I am not.
Posted by Alicia Swaringen on Sunday, April 8th, 2018 at 3:14pmAlicia, Hopefully you've got your own Buyer broker and not a dual agent. If so I'd suggest letting them know this is significant to you and that you're upset that they didn't make you aware of the complications that arise with a buried oil tank. Leaks would rarely be obvious. The fact that it's being used is helpful in that the oil provider may be the owner of the tank, it's worth looking into. Testing would typically be soil only, and unless some evidence of a leakage were found then you'd be done. The tank would be pumped out, cleaned and typically filled with cement and abandoned in place and the engineer would write a letter to the state indicating proper testing and abandonment. If there is leakage discovered your agent needs to work with the seller's agent to get it remediated. They may want to sell it "as-is" however once they've been given the information that there is contamination, they must disclose this so this really isn't a viable option for the seller. Consult with you attorney if you've further questions.
Good luck.
It's new to my knowledge that having an underground oil tank is more susceptible to corrosion and leakage and may actually lead to a more serious damage if not properly maintained. My husband and I recently bought a home with an already built-in underground tank. I would suggest then to my husband to have it remove and switch to an above-ground tank which I believe will be safer.
Posted by Sam Weaver on Thursday, April 25th, 2019 at 8:36pmSam glad to hear you found the article informational. We appreciate your taking the time to leave a comment. Larry - My NC Homes
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