Enron Mail

From:jeffrey.keeler@enron.com
To:james.prentice@enron.com, stanley.horton@enron.com, ted.robinson@enron.com,michael.robison@enron.com, stephen.swain@enron.com, lou.potempa@enron.com, micha.makowsky@enron.com, michael.terraso@enron.com, rick.craig@enron.com, marc.phillips@enron.com,
Subject:European position on MTBE
Cc:
Bcc:
Date:Thu, 23 Mar 2000 02:15:00 -0800 (PST)

EU backs MTBE despite US prohibition
ENDS Daily - 22/03/00
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The European Commission said today it had no plans to
propose an EU ban on petrol additive MTBE after the US
Environmental Protection Agency proposed to "significantly
reduce or eliminate" use of the substance. The agency says
MTBE (methyl tertiary-butyl ether) is a "possible
carcinogen" which has caused considerable damage to
groundwater.

Speaking on Monday, agency head Carol Browner said the move
was "necessary to protect America's drinking water
supplies." She said the USA would be replacing the additive
with ethanol, a non-petrochemical alternative. A
spokesperson for environment commissioner Margot Wallstr"m
said she was "following the reasons why" the US had proposed
its restrictions but had "no immediate plans" to call for
similar EU rules.

MTBE use in the US has tripled over the last decade. It
forms around 11% of "reformulated gasoline" - a compulsory
fuel in some big cities, where it helps to reduce air
emissions. However, it leaks from pipes and storage tanks
and has caught public attention because it also makes water
taste foul at very low concentrations.

In Europe, MTBE is used instead as an octane booster, and
typically only at concentrations of around 1.6% though it is
permitted up to 15%. New EU fuel and air quality laws aimed
at eliminating benzene mean the use of MBTE is set to
increase dramatically, however.

MTBE expert Eberhard Morgenroth of the Technical University
of Denmark says the EU will soon face a "political dilemma"
between protecting air quality and groundwater. "National
environmental protection agencies are only slowly starting
to realise the extent of problems connected to drinking
water contamination with MTBE," he says. "It might be that
in 10 years we will have the similar problems to the US."

Denmark last month announced plans to improve petrol station
storage standards after serious MBTE contamination was found
at some sites (ENDS Daily 8 February). Germany has also
found contaminated sites, some formerly occupied by Soviet
troops. Neither is contemplating a ban because alternative
octane boosters such as benzene are more toxic.

There are no EU environmental quality limits governing MTBE,
but an EU-sponsored risk assessment is underway in Finland,
Europe's heaviest per-capita consumer. An oil industry
source said a ban would "clearly put a restriction on [fuel]
blending" and would "not be a trivial problem," but said no
work had been done to estimate the impact of a ban. As one
of the world's top ten high production volume chemicals,
however, economic effects would very likely be significant.