In 2008, DEP staff discovered a glitch Dragon's wastewater-to-process-water system whereby facility wastewater and water that leached from waste piles would be discharged to a wetland that drained into the St. George River.

Dragon won an environmental award in 1998 for developing a closed-loop system to use wastewater as process water, but the loop was not completely closed.

In March 2008, staff at the plant flushed 600 gallons of spilled liquid acid cleaner down a storm drain into a quarry. That quarry, known as Quarry 1, was considered by DEP a “process vessel,” containing stormwater and process water, whose contents didn’t affect any public waters. It was where wastewater would end up if the tanks that held it before it was used as process water were full.

But unknown to at least one DEP official, when the water in Quarry 1 reached a certain level it was pumped to an onsite wetland that drained off site.

During an inspection after the acid spill, a DEP official witnessed this occurring. He said the quarry would be pumped down “irrespective of the operating and site conditions impacting what is or has been recently going into it.”

In an expression of alarm at the situation, the official, who did not sign the inspection memo, wrote: “If this seems confusing, that’s because it is. At a minimum, Dragon is at least intermittently discharging Quarry 1 contents into a wetland [draining to the] St. George River. I’m not going to hazard any suggestions regarding how to proceed here; some subset of the Division, including me, may want to look into this further.”

Earlier spill reports tell a similar story about Quarry 1. Its water was being released to surrounding surface water; hazardous materials were being spilled into it. In 1983 the department got a call from someone who had found 10 dead eels in a nearby stream. DEP officials went to investigate and noted a brown substance in the water, which they traced to an overflowing rock berm at Quarry 1. According to the spill report, Dragon staff at the time said the berm, installed by previous owners, was “totally inadequate.”

In 1996 a 55-gallon drum of lube oil was accidentally knocked over and spilled into a storm drain that emptied into Quarry 1. In the largest spill documented for the site, in 2005, 6,000 gallons of aqueous ammonium hydroxide spilled out of a storage tank into a storm drain. But after much DEP involvement in cleanup efforts at the quarry, the spill report concluded that it appeared “through limited data" that no ammonia was discharged into to the wetland off site.

To get a handle on the situation, DEP required in 2009 that Dragon test discharge from Quarry 1 to its onsite wetland every 10 days for three months. During the required sampling period, DEP sent Dragon a formal notice of violation for discharging quarry water containing leachate to the wetland which led to a stormwater discharge pipe off site. While the kiln was shut down that year because of the recession, Dragon began filling tankers with wastewater and trucking it to Bucksport to be used as process water at the now-closed Verso paper mill, "to lessen impact to the wetland," according to the inspection memo.

When Thomaston installed a new sewer line along Route 1, Dragon was able to begin sending its unused process water to the town's sewage treatment facility instead of emptying it into the quarry. John Fancy, superintendent at the facility, said the first influx of process water from Dragon to the treatment plant occurred in May 2010.

“We get 40 to 50 million gallons from Dragon in the course of a year,” he said. “That number has been going down, because they're using more of the water themselves.”

“Basically the problem with Quarry 1 was that it was an unknown,” said Michael Martunas, Dragon’s environmental manager.

Today, Quarry 1 contents are still pumped out to the wetland when the water reaches a certain height because of precipitation. But Martunas said the plant’s stormwater plan requires that water be monitored before it is discharged to the on-site wetland, or settling pond.

“You'd be hard-pressed to tell it's a settling pond,” he said. “There are cat-of-nine-tails and ducks and geese.”

“There's always a possibility that there can be some kind of accident,” Martunas continued, but Plant Manager Ray DeGrass said, “The control point is that if there is a spill, we don't [pump out the quarry] — it's manual.”

Richard Heath, senior environmental hydrologist with DEP’s Bureau of Solid Waste Management, said during a phone call in March that he reviewed the discharge monitoring data for Quarry 1 from the beginning of 2015. “I ran a comparison to ambient water quality, a threshold level we consider a possible threat to aquatic species,” he said. “From 2015 to today there has not been an exceedence at that treatment wetland.”

South of the plant is a vast preserve of wetlands, which Annette Naegel, conservation program manager at Georges River Land Trust, said is important for migratory birds that travel the corridor between the Weskeag and St. George rivers. Water draining from Dragon's settling pond flows into this wetland through a stream that crosses Route 131. Naegle said Martunas shares monitoring data for that stream with her and there have not been any problems that she’s been aware of.