Cash payments top $117M in MTBE lawsuit
CITY HALL — The money keeps trickling in from defendants named in the biggest lawsuit ever levied by attorneys here.
Union Oil Company California has agreed to pay City Hall $5 million for its role in contaminating Santa Monica’s drinking water with Methyl Tertiary-Butyl Ether, assistant city attorney Joe Lawrence said.
Unocal’s settlement offer was unanimously approved by the City Council Tuesday, bringing City Hall one step closer to the end of a contentious, three-year legal dispute.
Lawrence said there are two, smaller oil companies that are expected to settle in the coming weeks for a total of $800,000. That leaves as defendant only Lyondell Chemical Co., which has refused to discuss any settlement.
“There are no negotiations with Lyondell,” Lawrence said Wednesday. “It might very well go to trial.”
Unocal’s settlement brings the total amount of cash City Hall has received from the 1996 contamination of its drinking water wells by MTBE, a gasoline additive, to more than $117 million.
In addition to the cash payments, three oil companies — Shell, ChevronTexaco and ExxonMobil — agreed last month to pay hundreds of millions of dollars to clean up the MTBE contamination, which was caused when underground storage tanks leaked gas into the ground water.
A new treatment facility, the first of its kind, will be built specifically to clean up the city’s water at the Charnock Well Field in West LA, the city’s main water source.
The settlement ensures that the oil companies will pay for all costs to construct, operate and maintain the treatment plant, which officials expect will clean the city’s water supply by 2008. The costs could exceed several hundred million dollars.
City Hall’s lawsuit was levied against 18 oil companies and manufacturers in 2000. The cash settlements will be used to cover out-of-pocket costs, and other city needs, like continued water quality improvements and water security.
The City Council accepted $4.5 million from Ultramar Ltd., while Atlantic Richfield Co. paid City Hall $9.75 million. Conoco Phillips paid $6 million and Conoco Inc. settled for more than $4.5 million. Additionally, the three companies that will cover the cost of cleaning the water supply agreed last month to pay another $92.5 million in cash to City Hall for the contamination.
City Councilman Bob Holbrook said he’s gratified that the legal dispute appears to be nearing an end. He credited Lawrence and the other attorneys for doing solid legal work.
“Believe it or not, I think this has been a shorter process than it could have been,” he said.
“Believe it or not, I think this has been a shorter process than it could have been.” — — BOB HOLBROOK City Councilman
Originally published in the Santa Monica Daily Press print edition on December 4, 2003. Read the original PDF.