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Remediation

When groundwater contamination was first discovered at one of IBM’s sites in 1977, the company initiated groundwater monitoring at all of its manufacturing and development locations worldwide. Today, IBM has 2,677 monitoring wells and 107 extraction wells.

In 2011, 16,069 pounds of solvents from past contamination were extracted while remediating, controlling and containing groundwater at six currently operating sites and 11 former sites in three countries. At four of these sites, an additional 1,837 pounds of solvents were removed by soil vapor extraction or other methods. IBM also has financial responsibility for remediation at two other former sites.

As a result of the United States Superfund law, IBM is involved in cleanup operations at some non-IBM sites in the United States. The Superfund law creates a retroactive responsibility for certain past actions, even though they may have been technically and legally acceptable at the time.

As of year-end 2011, IBM had received notification (through federal, state or private party) of its potential liability at 110 sites, since the beginning of the United States Superfund program back in 1980. Of these, 57 are on the United States National Priority List. At the majority of the 110 sites, it has been determined that IBM either never had liability or has resolved its potential liability. As of now, IBM believes it may have potential liability at only 17 sites noticed through 2011.

When investigation and/or remediation at an IBM location or an off-site facility is probable, and its costs can be reasonably estimated, IBM establishes accruals for loss contingency. Estimated costs connected with closure activities (such as removing and restoring chemical storage facilities) are accrued when the decision to close down a facility is made. As of December 31, 2011, the total accrual amount was $262 million.