Citgo Settles Pollution Lawsuit

(AP)  Citgo Petroleum Corp. will install $320 million in pollution controls at six refineries and pay a $3.6 million fine to settle a federal lawsuit alleging Clean Air Act violations, the Bush administration announced Wednesday.

The settlement requires Citgo, the nation's No. 4 gas retailer, to reduce yearly emissions of nitrogen oxide by 7,184 tons and sulfur dioxide by 23,250 tons. Both can cause serious respiratory ailments and worsen cases of childhood asthma.

The refineries covered in the agreement among the company, the Justice Department, Environmental Protection Agency and four states, represent 5 percent of the nation's refining capacity.

"Today's settlement means we're one step closer to bringing all of America's oil refineries into compliance with our Clean Air Act standards, which means cleaner air for our communities and citizens," said Thomas Sansonetti, assistant attorney general for the Justice Department's environment division.

The Citgo refineries are in Corpus Christi, Texas, which has two facilities; Lemont, Ill.; Lake Charles, La.; Paulsboro, N.J.; and Savannah, Ga. The states of Illinois, Louisiana, New Jersey and Georgia joined in the agreement.

Citgo, which recently announced it was moving its U.S. headquarters from Tulsa, Okla., to Houston, said it did not admit to Clean Air Act violations in the agreement but will implement the pollution controls beginning next year.

"These additional improvements will ensure that the corporation reaches its goal of becoming an exceptional environmental steward," said Luis Marin, chief executive officer and president of Citgo, which is a unit of Venezuela's state oil company.

The Citgo settlement is the 12th reached under an EPA initiative begun in December 2000. Thomas Skinner, EPA's assistant administrator for enforcement, said the agreements have cut air pollution by 200,000 tons a year at 48 refineries in 24 states.

The amount Citgo is required to spend on pollution controls ranks fourth among the companies that have reached settlements over the past four years. The largest was in the agreement with Motiva Enterprises, at $550 million.

In addition to the pollution controls and civil penalty, Citgo will spend another $5 million to further reduce emissions at its refineries in Corpus Christi. The agreement was filed in U.S. District Court in Texas and still requires the approval of a federal judge.

According to the Justice Department, companies caught violating anti-pollution laws have agreed this year to spend more than $4 billion to reduce emissions. Courts have imposed $181 million in civil penalties for those violations.


By Curt Anderson