ExxonMobil Witness in Trial Says MTBE Raised Cancer Risk

New Hampshire’s last witness in a trial alleging Exxon Mobil Corp. contaminated the state’s drinking water with the gasoline additive MTBE told jurors studies indicated the chemical raised cancer risks in rodents.

Robert Biles, a retired Exxon Mobil toxicologist who was ordered to be a witness for the state, said in videotaped testimony today that several studies of MTBE on mice and rats showed an increased risk of reproductive problems as well as cancer.

“There was some evidence of severe toxicity in some of the studies,” Biles said.

The state has estimated it could cost about $818 million to test, monitor and clean up groundwater contaminated with methyl tertiary butyl ether, or MTBE. Based on New Hampshire’s estimate that Irving, Texas-based Exxon Mobil (XOM) sold 30 percent of the state’s gasoline from 1988 to 2005, it might ask the jury for damages of $245 million if the company is found liable. Other oil companies sued by the state have settled.

The state’s lawyers questioned Biles about studies by the American Petroleum Institute showing that at mid-to-high levels ingestion or inhalation of MTBE elevated the risk of brain tumors, liver cancer, blood cancer and kidney cancer in mice and rats.

Findings Expected

Exxon Mobil lawyers today played other excerpts from Biles’s taped deposition in which he said the toxicology findings weren’t unexpected or cause for alarm.

“All toxicology studies produce effects,” Biles said. “We’re all exposed to chemicals every day that cause risks.”

Exxon Mobil is scheduled to begin presenting its case on March 4.

Yesterday, Exxon Mobil challenged state testimony by Justine Hastings, an economist who said her methodology determined that the company sold 30 percent of the state’s gasoline. The company’s lawyers said she should have used refinery data, which would have shown a market share as low as 6.9 percent. Hastings said that method can’t adequately measure how much gasoline is sold.

Exxon Mobil has argued in court that it isn’t liable for damage because it added MTBE to gasoline to comply with federal regulations, which pre-empt state law. Oil companies added MTBE to make gasoline burn more thoroughly in order to reduce air pollution, as required under the 1990 Clean Air Act. The company argued that the state was aware of the risks of MTBE when it agreed to participate in a federal clean-air program.

MTBE Alternatives

Witnesses for the state have testified that oil companies could have used chemicals other than MTBE to increase the oxygen content of the fuel, such as ethanol.

William Stack, an Exxon Mobil lawyer, said in court this week that ethanol wasn’t a good choice as an additive because at the time of the federal mandate it caused engine damage and wasn’t in adequate enough supply.

MTBE, which New Hampshire banned in January 2007, is highly soluble in water and can be carried great distances from where it leaked. It leaked from gas stations, vehicle junkyards, underground storage tanks and pipe fittings, the state has said.

Citgo Petroleum Corp., which was a co-defendant with Exxon Mobil in the trial, filed a $16 million settlement agreement with the state on Feb. 15. New Hampshire had received more than $100 million in settlements from other companies before Citgo’s agreement, according to court papers.

Shell Oil Co., Sunoco Inc., ConocoPhillips (COP), Irving Oil Ltd., Vitol SA and Hess Corp. settled before the trial began.

The New Hampshire case is one of scores of lawsuits involving MTBE filed since 2000 against oil refiners, fuel distributors and chemical makers. MTBE lawsuits have been consolidated in federal court in New York for pretrial evidence- gathering and motions.

In 2009, a federal jury ordered Exxon Mobil to pay New York City $104.7 million after finding it liable for polluting wells in the city. Exxon Mobil has appealed.

The case is New Hampshire v. Hess Corp. (HES), 03-C-0550, New Hampshire Superior Court, Merrimack County (Concord).

To contact the reporters on this story: Sarah Earle in Concord, New Hampshire, at sarah_earle@comcast.net; Don Jeffrey in New York at djeffrey1@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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