LI water suppliers to get $112.8M in MTBE suit

Long Island water suppliers would receive $112.8 million from more than a dozen oil companies in a landmark settlement over contamination of groundwater by the fuel additive MTBE.

The Suffolk County Water Authority, the biggest local water provider, would get the largest single award in the agreement announced yesterday: $104.3 million, or $73.4 million after attorney fees. The money will be used to clean up wells tainted by methyl tertiary butyl ether and for continued monitoring.

If approved by a district judge, the settlement filed Wednesday would award $423 million to 153 water suppliers in 17 different states, including 11 in Nassau and Suffolk. The oil companies - among them Shell, Chevron, BP Amoco and Hess - would also be required to bear cleanup costs for wells that become contaminated in the next 30 years.

"It's the largest settlement in the history of MTBE litigation," said attorney Robert Gordon of Weitz & Luxenberg, one of three firms representing plaintiffs who settled.

A fuel oxygenate intended to make gasoline burn more cleanly, MTBE was used in states with air quality problems in the 1990s and early 2000s. But the additive turned out to have a downside: when released by gas spills or leaking storage tanks, it quickly moved through groundwater to pollute local water supplies.

The EPA lists MTBE as a potential carcinogen based on studies of animals exposed to large amounts. Little is known about its human health effects, but it has proved difficult - and costly - to remove from groundwater.

"This is a great day for ratepayers who have been shouldering the financial burden for the last decade or so related to the testing and filtration of MTBE from our drinking water," water authority executive director Steve Jones said at a news conference in Hauppauge. MTBE has been detected in least 450 of the authority's 600 wells, he said.

The settlement followed more than a year of negotiations from December to February, according to court papers.

Other beneficiaries include water suppliers in Franklin Square, Great Neck, Hicksville, Port Washington, Roslyn and Sands Point. The Western Nassau Water Authority, the Long Island Water Corporation and Nassau County are also part of the settlement.

Gordon said Suffolk County Water Authority was awarded the largest settlement based on the number of affected wells, the length of contamination, and because it was at the forefront of the litigation.

The water authority, along with Suffolk County, first filed suit against several oil companies in 2002. That case was later sent to federal court and is due for trial in September.

The case is still set for trial because a few defendants - most prominently Exxon Mobil - have refused to settle. Attorney Peter Sacripanti of McDermott Will & Emery, which represents Exxon Mobil, said the company's conduct "was lawful, and did not injure or cause damage to the plaintiffs." Exxon planned to vigorously defend itself in September, he said.

The settlement includes more than half the plaintiffs in the federal cases, but excludes some from Long Island, such as the West Hempstead and Westbury water districts and towns of East Hampton and Southampton.

New York City, which also has a federal MTBE suit pending, was not part of yesterday's settlement.