Chevron, BP and other major oil companies have agreed to pay $423 million to settle more than 500 lawsuits brought by water suppliers and users in California and 19 other states over groundwater contaminated with the gasoline additive MTBE.
In California, 11 plaintiffs would receive more than $78 million plus possible reimbursement for future treatment of nearly 1,100 wells, attorneys said.
The suits alleged that the oil companies were responsible for contamination in underground aquifers in the city of Riverside, portions of San Diego and Sacramento counties and elsewhere across the nation by adding methyl tertiary butyl ether, or MTBE, to gasoline as a way to reduce air pollution.
The proposed settlement was filed Wednesday with U.S. District Judge Shira Scheindlin in New York, who will review it.
The six oil companies that didn't agree to settle include Exxon Mobil Corp., the world's largest publicly traded company.
Federal regulators have said that MTBE is a possible carcinogen at high doses, and California law limits exposure to 13 parts per billion in water.
It can render water undrinkable because of its offensive smell and taste, according to the U.S. Environmental Protection Agency.
Attorney Vic Sher of San Francisco, who is representing 20 of the water districts that sued, said the proposed settlement was "a large step toward making sure that the parties responsible for this problem pay for it, rather than the folks who drink the water and pay the rates."
He added, "The documents and the testimony are pretty darn overwhelming that the companies knew that MTBE was a different kind of water contaminant, and was a water contaminant, and that there were ways the problem could have been avoided."
But attorney Rick Wallace of Washington, D.C., who is a liaison with the court for the 12 companies, said Sher's statements were not true.
"MTBE is not a contaminant . . . and this settlement does not say that," he said.
He said the companies had told regulators about the potential problems and benefits of the additive as far back as the 1980s.
He said that the additive had greatly reduced deadly air pollution.
Several states, including California, have banned use of MTBE, and it has been phased out elsewhere since Congress dropped a requirement in 2006 that gasoline have pollution-reducing oxygenates such as MTBE.
He said the companies might have prevailed in a trial, but could have also faced far larger costs.
