Washington (Platts)--13Jul2005

Manufacturers of gasoline additive MTBE would pay to clean up polluted water
supplies through a "special trust fund" under a possible compromise deal,
House Energy and Commerce Committee Joseph Barton (Republican-Texas) said in a
floor statement Wednesday. Barton has been working on a compromise he hopes
will end a House-Senate dispute over language in the House version of the
energy bill that would provide MTBE manufacturers with a waiver from defective
product lawsuits. Senate opposition to the language was widely blamed for the
defeat of a broad energy bill in the last Congress. Barton, who Tuesday said
he hoped to present the offer to Senate leaders this week, did not specify how
large the fund would be, but said it would be "sufficiently funded" and could
only used for cleanups, not legal costs. He indicated that government would
help defray cleanup costs. "They're going to help us pay for it and clean it
up," he said of the MTBE producers and handlers.

Communities across the country have sued oil companies that make MTBE for
leaks that have fouled water supplies, with cleanup costs estimated to be
anywhere from $29-bil to $85-bil. House and Senate negotiators are expected to
meet Thursday afternoon to begin talks on a compromise bill that must get
final approval from both chambers. Democratic senators have said they would
try to block the bill if it contains any "safe harbor" provision for MTBE, and
budget hawks oppose using federal dollars to pay for cleanup. The cleanup fund
proposal has been discussed in various forms for two years, and supporters
argue it is appropriate because Congress required oxygenated gasoline under
the 1990 Clean Air Act, and that MTBE was effectively mandated. The energy
bills passed by the House and Senate would eliminate the act's 2% oxygenate
requirement.

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