US refiners began adding MTBE to gasoline in 1979 as an anti-knock agent that replaced lead, but its use soared in 1995 to comply with a federal law to make fuel burn cleanly.

But MTBE has seeped into underground water supplies in all 50 states through leaky underground storage tanks. It renders water undrinkable because of a turpentine-like odor and taste.

The cost of cleaning up the mess is estimated by municipal water experts at $29 billion. Consultant Komex H2O Science Inc. said in 2004 that the cost could soar as high as $63 billion.

"It has come out of left field to become our most important issue," said Don Duncan, a vice president who runs the Washington office of ConocoPhillips, the No. 3 US oil firm.

"The writing was on the wall for us that this had the potential to be the next tobacco," Duncan added, referring to the huge settlement of more than $200 billion reached by tobacco companies with states in 1998.

Powerful House Republicans, including Majority Leader Tom DeLay and Rep. Joe Barton of Texas, want to revive the energy bill this month, including a provision to protect oil companies and other MTBE makers from defective product lawsuits, meaning they could not be sued simply for manufacturing MTBE.

They contend that the Clean Air Act required refiners to use additives like MTBE to reduce ozone, and refiners should not be punished for following the law.

Moderate Republicans and many Democrats in the Senate vehemently oppose the liability shield as a get-out-of-jail free card that would allow companies like ExxonMobil, ConocoPhillips and Lyondell Chemical Co. to duck liability and stick communities with the cleanup bill.

FORCED TO USE MTBE?

Rep. Henry Waxman, a California Democrat, points to documents which he says prove that Congress never meant to require refiners to use MTBE.

In a 1994 letter to the Environmental Protection Agency opposing a proposal to mandate ethanol, lawmakers including DeLay and Barton said "the point can be no more clear" that the Clean Air Act was meant to be "entirely fuel neutral."

"Congress wanted cleaner burning fuels, but no one told the oil companies they had to use MTBE," Waxman said in a statement. "Oil companies are making record profits, yet are asking local governments and ratepayers to pay $29 billion or more to clean up the oil companies' pollution."

Barton spokesman Larry Neal acknowledged that the law does not explicitly require MTBE. But refiners had few choices beyond MTBE or ethanol, derived from corn, he said.

"No, the law didn't name either MTBE or ethanol, but it did make it impossible to use anything else," Neal said. "Everybody knew that then and everybody knows it now."

ENERGY BILL DEBATE RESUMES SOON

MTBE will factor prominently when House lawmakers take up debate on the energy bill April 5.

Senate Energy Committee Chairman Pete Domenici has opposed its inclusion in the Senate version of the bill, but it could be inserted in a House-Senate bargaining session that would follow the bill's passage by both chambers.

Product liability was the basis for a landmark MTBE case in California in 2002, where a jury found several oil companies liable for making a defective product. The companies settled for $69 million before the jury could award damages.

The legislation favored by DeLay and Barton "would just leave you being able to go after the mom-and-pop gas stations that did the spill, and they don't have any money," said Al Warburton, a lobbyist at the American Water Works Association.

Oil firms say they are willing to pay for cleaning up spills, but should not be sued for merely making MTBE.