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Asunto:[LEA-Venezuela] Exxon Mobil retirará pronto MTBE (Reuter/English )
Fecha:Lunes, 15 de Julio, 2002  05:12:12 (-0400)
Autor:Vitae <vitae1>

Exxon Mobil to phase out MTBE in California early


USA: July 15, 2002

NEW YORK - Exxon Mobil Corp. , the world's largest oil company, became the latest major refiner in California to set an early date for phasing out a fuel additive that has contaminated ground water, in a move that could result in price spikes and gasoline shortages.

The Irving, Texas-based company said it would phase out methyl tertiary butyl ether (MTBE) and convert to ethanol by early 2003, nearly a year ahead of a deadline set by California Gov. Gray Davis in March.

In 1999, Davis banned MTBE after the suspected carcinogen was discovered contaminating groundwater supplies. Federal law requires that gasoline sold in the smoggiest regions in the country include one of the two additives to help gasoline burn cleaner.

In March, citing fears of possible supply disruptions and resulting prices spikes, Davis postponed his original phase-out deadline by one year to Dec. 31, 2003.

Earlier this year, major refiners BP , and Shell Oil Company announced they will switch additives ahead of Davis's mandated Dec. 31 cut-off. With Exxon Mobil's switch, more than half the state's gasoline will be affected.

With a daily consumption of 1 million barrels a day, California is the largest gasoline market in the U.S.


Critics say the change has been dictated by corporations that want higher gasoline prices and an escape from millions of dollars in potential fines in lawsuits around the country, as refiners that sold MTBE-blended gasoline are sued for water contamination.

"From the perspective of a major oil company, to continue with MTBE is to continue with exposure to liability," said consultant Thomas Gieskes, whose firm Stillwater Associates was hired by the state to study the supply and price impacts of the MTBE phaseout.

"If they don't continue with MTBE, subsequent shortfalls of gasoline are likely to increase their profit margins," Gieskes added.

Current regulations require cleaner-burning gasolines to be blended with twice as much MTBE as ethanol.

To replace the MTBE that is taken out, and to stabilize the ethanol that is added, expensive and scarce ultra-clean fuel components will be needed to be imported into the state's insular gasoline market, which analysts say may result gas shortages as high as 10 percent and higher profits for refiners.

"We understand that various refiners have obtained bargain ethanol prices in the last few months," California Environmental Protection Agency spokesman William L. Rukeyser said.

"If Exxon Mobil has locked in a low cost ethanol supply we hope it will pass the savings along to California motorists."

The sentiment is echoed by the country's most influential environmental groups.

"It's a shame they have to use any oxygenate at all in gasoline. The real question is what will be the impact on gas prices and air quality," Frank O'Donnell, executive director of Clean Air Trust.

Although ethanol has been praised for lowering carbon monoxide emissions in winter, it can actually contribute to low level smog in basin areas like Los Angeles, environmentalists said.

"It's been shown that ethanol is a mixed blessing when it is added to gasoline: that it can reduce some toxic pollutants and increase others, like nitrous oxides, and increases emissions that don't come out of the tail pipe," O'Donnell added.

Story by Soo Youn