NH, Citgo agree to drop Citgo from MTBE suit

CONCORD, N.H. (AP) -- A judge has granted a request to remove Citgo from a New Hampshire lawsuit accusing the oil company and another petroleum giant of failing to warn state officials about the gasoline additive MTBE.

The state's lawsuit against Exxon Mobil Corp. and Citgo went to trial Monday. But a judge Wednesday granted a motion from the state and Citgo to remove the company from the case provided the two sides reach an agreement by Feb. 15. Lawyers for the state declined to say whether that meant a settlement is in the works.

The state sued the companies in 2003 alleging that gasoline containing MTBE — methyl tertiary butyl ether — was a defective product and that the oil companies had a duty to warn state officials about its special properties and ability to contaminate groundwater in greater levels than traditional gasoline. It estimates that more than 40,000 wells are contaminated and was seeking more than $700 million from both companies to monitor drinking water wells and clean up high-risk sites where MTBE contaminated groundwater.

Lawyers for the oil companies did not return calls Wednesday. In opening statements earlier, they said the product wasn't defective — it did what it was supposed to do by reducing lead content in gas and making it burn cleaner — and that the state is inflating its estimates of how many wells were contaminated. Oil companies say the state is looking for a scapegoat; The state says it wants to hold companies responsible for their product.

New Hampshire filed its lawsuit in 2003, four years before it banned the use of MTBE. The case is the first brought by a state over MTBE contamination to reach trial.