State Issues Abatement Orders Over Redwood Creek Bentonite Discharge, Threatens Fines Up to $5,000 a Day

The white plume that spread through Redwood Creek earlier this month now has a price tag.

After documenting bentonite drilling waste buried up to two feet deep in a salmon-bearing tributary, California’s North Coast Regional Water Quality Control Board has ordered the cleanup of the contamination and named four parties it says are responsible.

The June 17 enforcement orders identify Briceland Road property owner Mykal Coelho and three companies involved in California’s Broadband for All fiber project. Together they now face cleanup requirements, biological monitoring, reporting deadlines, and potentially significant penalties if they fail to comply.

The Water Board says the waste originated from horizontal directional drilling operations associated with a Highway 101 fiber installation project and was transported to private properties in the Redway area before reaching Redwood Creek and ultimately the South Fork of the Eel River.

The Water Board’s findings paint a stark picture. Staff documented clay deposits in roadside ditches leading from the Briceland Road property into a tributary that drains to Redwood Creek. By June 4, investigators reported turbidity extending roughly three miles downstream to the South Fork of the Eel River. During a June 10 inspection, CDFW estimated bentonite deposits in the first pool below the tributary culvert had reached approximately two feet deep, with observable deposits covering nearly the entire width and length of the channel.

Redwood Creek is a documented coho salmon rearing stream and supports threatened steelhead. The South Fork of the Eel River watershed has long struggled with sediment impairment and has been identified as a priority watershed for salmon recovery.

Now the Water Board says those responsible must clean it up.

What the Orders Require

The first order, No. R1-2026-0039, names Briceland Road property owner Mykal Coelho as the responsible party for the property where investigators say the first loads of drilling waste were dumped beginning in late May.

The order requires Coelho to retain qualified professionals, submit a full accounting of the discharge and a cleanup plan by July 10, begin weekly progress reports on July 13, complete cleanup work by July 29, and submit a final completion report by August 7.

The Water Board estimates the reporting requirements alone could cost between approximately $13,600 and $36,450, separate from the actual cleanup work.

The second order, No. R1-2026-0038, names Direct Drilling, Inc., North Sky Communications, LLC, and Arcadian Infracom 4, LLC as jointly and severally liable responsible parties.

That designation means the state may recover the full cost of cleanup, monitoring, and enforcement from any one of the companies, all of them together, or any combination of them, regardless of how responsibility is ultimately divided among the companies themselves.

The contractors face broader requirements than the landowner. In addition to documenting the discharge and submitting a cleanup plan by July 10, they must identify all disposal sites used during the project, develop a downstream notification plan, assess impacts to fish and stream habitat, propose mitigation measures, and carry out long-term monitoring.

That monitoring does not end when the cleanup is complete. The order requires biological surveys timed to future coho salmon and steelhead spawning seasons, with reports due every March and September until the Water Board determines recovery goals have been met. Depending on findings, monitoring could continue well into 2027 or beyond.

The Water Board estimates reporting requirements for the three companies alone could range from approximately $46,000 to $117,000, before cleanup, restoration, monitoring, or potential penalties are factored in.

Potential Penalties

Both orders warn that failure to comply could trigger substantial financial penalties.

Under California Water Code sections 13268, 13350, and 13385, the Water Board may seek fines of up to $1,000 per day for missed reporting deadlines and up to $5,000 per day, or $10 per gallon, for unauthorized discharges. The agency may also recover its own investigation and enforcement costs from responsible parties.

Neither order is necessarily the final word. All named parties have 30 days to petition the State Water Resources Control Board for review.

A Second Disposal Site

Gray bentonite drilling slurry fills an unpermitted pit excavated at the Meadows Business Park in Redway. The pit was one of at least two sites in Southern Humboldt where drilling waste from the Broadband for All project was disposed of without permits. The North Coast Regional Water Quality Control Board confirmed no permit exists anywhere in its jurisdiction for disposal of drill-related waste. Photo: California Department of Fish and Wildlife, June 4, 2026.

The contractors’ order addresses a second disposal site at a Meadows Business Park property on Evergreen Road in Redway.

According to the order, Direct Drilling shifted disposal operations there around June 1, using an excavated pit to store and recycle drilling slurry generated by the project. During a June 4 inspection, California Department of Fish and Wildlife personnel documented a pit filled with gray slurry and bags of drilling materials nearby.

On June 9, Humboldt County Code Enforcement issued a stop-work order for the site until an acceptable waste disposal plan could be provided.

Unlike the Briceland Road property owner, the Meadows Business Park property owner is not named in either order.

In a statement to Redheaded Blackbelt, the property owner said neither he nor his tenant, who had sublet part of the property to Direct Drilling, knew the company was excavating a disposal pit on the property.

That account sits in some tension with what Director of Planning and Building John Ford told Redheaded Blackbelt in an earlier interview. Ford said the county’s stop work order was issued after the party responsible for a storage yard at the Meadows Business Park withdrew permission for the site to be used as a dump, language that suggests someone with authority over the property had agreed to the arrangement before reversing course. 

Both state that the water board reserves the right to amend the order, or issue a new one, if additional responsible parties are identified, which means the property owner and his tenant could still end up named before this is over. 

The Bigger Question: Where Was the Waste Supposed to Go?

Beyond assigning responsibility for the contamination already documented in Redwood Creek, the orders raise a larger question about project planning.

Humboldt County Environmental Health officials told Redheaded Blackbelt there are no facilities in Humboldt County permitted to accept liquid HDD drilling slurry. The material would first need to be dewatered before a landfill could potentially accept it.

Yet Caltrans’ permit for the project required drilling fluids to be disposed of in a manner acceptable to appropriate regulatory agencies. Industry guidance similarly calls for disposal plans to be established before drilling begins.

If no permitted facility existed locally to accept the material, what was the disposal plan before drilling started?

That question sits at the center of an increasingly complicated chain of public agencies and private contractors.

California’s Department of Technology administers the state’s $3.25 billion Broadband for All middle-mile program but does not directly build the network. Instead, the state contracts through GoldenStateNet, a subsidiary of CENIC, which partners with private developers such as Arcadian Infracom. Arcadian hired North Sky Communications as the general contractor, which in turn subcontracted the drilling work to Direct Drilling.

The state uses the model because it allows construction to move more quickly while shifting much of the day-to-day construction risk to private contractors. The tradeoff is that responsibility becomes spread across multiple organizations.

When thousands of gallons of drilling slurry end up in a salmon-bearing stream, the agency funding the work is several contracts removed from the crews making decisions in the field.

The California Department of Technology told Redheaded Blackbelt it is monitoring the situation.

“We are following this issue closely and coordinating with our State and local partners,” said Deputy Director of Communications and Stakeholder Relations Monica Hernández. “The State remains firmly committed to protecting natural resources, and we stand ready to take any necessary action as soon as the full scope of the issue becomes clear.”

Caltrans, which issued the encroachment permit governing construction within the Highway 101 right-of-way, says it did not authorize disposal of drilling slurry on private property and is coordinating with the Water Board, CDFW, and Humboldt County as investigations continue.

None of the three companies named in the cleanup order responded to requests for comment.

What Happens Next

The next major deadline arrives July 10, when both Coelho and the three companies must submit detailed accounts of what occurred and their proposed cleanup plans.

The Water Board has stated it believes additional disposal sites may exist beyond the two already identified.

Investigators documented approximately 32,000 gallons of drilling waste generated per week during the initial phase of construction, and the agency notes at least one additional Redway-area landowner was approached about accepting drilling waste but declined.

Whether additional disposal locations will be identified, and whether additional responsible parties will ultimately be named, remains one of the central questions as the investigation continues.

Note: Redheaded Blackbelt reached out to Briceland Property owner Mykal Coelho for comment late last night. As of the publication of this article at 1 a.m., no response was given. This article will be updated if a comment has been made. 

Were You Approached?

Investigators believe there may be additional disposal sites beyond the two already identified. If you were approached by representatives of the drilling operation and asked to accept slurry on your property, whether you agreed or turned them down, Redheaded Blackbelt wants to hear from you. We protect the anonymity of our sources. You can reach Lisa Music at [email protected]

Earlier:

• [Update] Unknown Substance Turns Redwood Creek White, Reaches South Fork Eel River
• Drilling Slurry Believed Source of White Plume in Redwood Creek; Agencies Investigating
• In a Push to Connect Rural California, Broadband Drilling Fouled Southern Humboldt’s Waterways
• Drilling Halted in Southern Humboldt Over Slurry Disposal; County Demands Plan Before Work Resumes

Lisa Music is a reporter for Redheaded Blackbelt, which covers Humboldt County and the North Coast at kymkemp.com.