MTBE lawsuit coming close to a resolution
What may be the biggest lawsuit ever levied by City Hall appears to be reaching a resolution.
Under a settlement agreement being hammered out now, more than a dozen oil companies will pay hundreds of millions of dollars to clean up the city’s drinking water wells.
Seven of Santa Monica’s 11 wells were contaminated in 1996 from underground gasoline storage tanks that leaked a toxic additive called Methyl Tertiary-Butyl Ether, which was designed to boost fuel performance and reduce emissions.
Under the agreement, the oil companies will pay whatever it costs to filter water at the wells until they are completely cleaned. It’s a process that, at worst, will take 35 years and cost $400 million, officials said.
Representatives from both sides of the dispute are so confident a settlement will be reached in the next few weeks they’ve already begun the clean-up process.
“The oil companies have actually allowed us to go ahead with some pilot testing,” said Craig Perkins, City Hall’s director of environmental and public works management.
Perkins added that the only unknown in the agreement is how much additional money City Hall should receive for being inconvenienced and the health risks posed to residents by the contamination.
“We’re negotiating a cash payment to the city which would cover some of the out-of-pocket costs we’ve had to endure over the years... and then be able to give us extra money to use for other needs,” Perkins said.
The lawsuit was levied against 18 oil companies and manufacturers in 2000. City Hall has so far negotiated more than $18 million in settlements.
“It’s a who’s who of the business,” said Deputy City Attorney Joe Lawrence, who is overseeing the lawsuit.
The City Council earlier this month accepted $4.5 million from oil giant Ultramar Ltd. And earlier this summer, Atlantic Richfield Co. paid City Hall $9.75 million. Conoco Inc. settled for more than $4.5 million in the spring of 2002, Lawrence said. City Attorney Marsha Moutrie said the MTBE lawsuit is “far and away” the biggest lawsuit that City Hall has been involved in during her 10-year tenure.
As of Jan. 1, 2004, it will be illegal to use MTBE, the colorless chemical compound that at very low concentrations smells like turpentine and is a suspected carcinogen in gasoline throughout California.
The additive was originally introduced as a way to boost octane and help meet clean-fuel requirements.
“MTBE was the chemical that was going to improve air quality and improve the efficiency of gasoline,” Councilman Bob Holbrook said. “But we hadn’t considered what might happen if it got into the water. This stuff is super soluble and it goes right through the earth just like water through a strainer.”
“MTBE was the chemical that was going to improve air quality and improve the efficiency of gasoline. But we hadn’t considered what might happen if it got into the water. This stuff is super soluble, and it goes right through the earth just like water through a strainer.” — — BOB HOLBROOK City Councilman
Leakage from underground gas storage tanks closed all five wells at the city’s Charnock Well Fields in Mar Vista and both wells at the Arcadia Well Fields in West LA.
A treatment facility was built at Arcadia and the wells now appear to be clean.
“It’s totally clean at this point, that’s the good news,” Perkins said. “The bad news is Charnock. Charnock has been shut down for more than seven years.”
Because seven of Santa Monica’s 11 wells had to be immediately shut down in 1996, the oil companies are paying millions of dollars a year to import about 80 percent of the 12-plus million gallons of water Santa Monica uses each day. Perkins said Santa Monica will probably start using treated water from the Charnock fields again in 2007 or 2008.
Despite the headaches cause by the whole incident, Holbrook said some good has come out of it.
“I see light at the end of the tunnel,” Holbrook said. “The bottom line is because this case was the first of its kind, MTBE is going to be out of gasoline nationwide.”
Originally published in the Santa Monica Daily Press print edition on October 27, 2003. Read the original PDF.