Exxon Fails to Slip by Guilty Verdict

GavelIt is hard to be an oil and gas producing giant and act environmentally conscious as well.

In order to reduce smog from gasoline-power vehicles, Exxon Mobil (NYSE:XOM) introduced the additive MTBE to its gasoline in the 1970s and 1980s, but that chemical was eventually found to have polluted the groundwater in New Hampshire. Following a three-month trial in the state, jurors determined that the world’s largest publicly traded oil company had acted negligently and, therefore, was liable for $236.4 million in civil penalties, Jessica Grant, a lawyer who represented the state, told Reuters. A portion of the damages handed to Exxon will be used to pay the costs of testing and cleaning affected water supplies.

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“We’re very pleased that the jury held Exxon accountable for the harm its defective product caused to the state’s groundwater resources and that they also held Exxon responsible for its negligence,” she said.

The case — which was initially filed in a new Hampshire court in 2003 by the state — charged that Exxon and several other major companies knew that MTBE was likely to contaminate groundwater and that the additive would be more difficult to clean up than other pollutants. While the case was filed in state court, it was later moved to the state’s federal courthouse in Concord in order to accommodate the number of witnesses, lawyers, and exhibits…

For its part, Exxon has vowed to appeal the court’s decision.”MTBE worked as intended to improve our air quality and the benefits of its use substantially outweighed the known risks,” company spokeswoman Rachael Moore told the publication. “MTBE contamination in New Hampshire is rapidly decreasing and the state’s current system for cleaning up gasoline spills ensures safe drinking water.

But whether or not MTBE contamination is rapidly decreasing, the U.S. Environmental Protection Agency now categorizes the chemical as a potential human carcinogen — although the majority of the research that has been conducted on the pollutant has focused on the negative health effects of inhaling the substance rather than drinking it.

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New Hampshire made MTBE illegal in the state in 2007.

Of the original 22 defendants named in the original lawsuit, Exxon was the only one to go to trial. Other defendants either had their cases dismissed or agreed to settlements. For example, Canada-based Irving Oil agreed to $57 million last year, while Venezuela’s state-owned Citgo Petroleum Corp. made a $16-million agreement when the trial first began.

In their decision, the jury found that the the contamination had caused $816 million in damages in the state of New Hampshire. To calculate what penalty Exxon should pay for its role in the groundwater pollution, the jury used Exxon’s market share of 29 percent, Grant said.

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