It was a lie. By then the industry already knew that MTBE was a disaster. An Exxon memo from April 3, 1984, reveals "ethical and environmental concerns" about the additive, including "possible leakage . . . into underground water systems of a gasoline component that is soluble in water to a much greater extent" than other chemicals and a fuel that may actually produce "poorer fuel economy." "That same year," Walker shows, "an Exxon engineer wrote the first in a series of memos outlining 'the reasons MTBE could add to ground water incident costs and adverse public exposure.'"
Why did the industry promote MTBE as an additive and then cover up its dangers? Walker says the answer is simple: profit. Back in the 1980s, looking for alternatives to rising U.S. reliance on foreign oil, Midwest congress members lobbied for federal subsidies to produce ethanol, a corn-based fuel that burns cleaner than oil and is domestically produced, but has one chief financial disadvantage where Big Oil is concerned: ethanol is produced by farmers, not oil refiners.
"What I recall is the EPA actually promoting using methanol blends," an ARCO executive testified in the South Lake Tahoe case. "The oil industry . . . brought [MTBE] forward as an alternative to what the EPA had originally proposed."
The oil industry, of course, won, and in 1992 the feds made MTBE the additive of choice. A dark windfall of spills, leaks and environmental contamination followed. As my colleague R. Scott Moxley discovered two months ago ( "Toxic Politics," March 16), a 1985 memo from an oil-industry engineer advised companies to factor into their budgets the costs of monitoring and preventing leaks of MTBE. An attorney involved in the South Lake Tahoe suit told Moxley oil companies ignored that advice, "choosing to protect billions of dollars in annual profits over environmental safeguards that would have cost little by comparison."
Now, faced with lawsuits like those here in Orange County, the industry wants government protection.
Richard Drury, an attorney with Communities for a Better Environment, said the companies' claims "are outrageous." The Environmental Working Group's Walker agrees. "They knew from the early 1980s that MTBE was a threat to the groundwater," he told me. "Their claims that they should be granted immunity from such suits are based on a lie."