Shell Selling Low-Polluting Gas in 9 Smoggiest Cities

Shell Oil Co., the nation’s largest marketer of gasoline, announced Wednesday that it has begun to sell a new low-polluting gasoline in nine cities--including Los Angeles--identified by President Bush as having the nation’s most severe air quality problems.

Shell President Frank H. Richardson, in a press conference here, said the new gasoline, which will replace the company’s premium grade, is expected to reduce the amount of hydrocarbons and carbon monoxide emissions by 80 tons a day nationally if all current users of Shell premium buy the new fuel. Almost half of that reduction in emissions would take place in Southern California.

The company said the fuel will cost 2 cents a gallon more to produce than its former premium grade gasoline but that prices will be competitively determined in each market.

According to figures supplied by Shell, emissions would be cut by 28 tons a day in the Los Angeles area--from San Bernardino to Oceanside--and an additional 5.7 tons in the San Diego area. Of more than 2,000 stations that began selling the new gasoline around the country Wednesday, 688 are in Southern California.

However, the 28 tons constitutes only a tiny fraction of the total 7,716 tons of pollutants spewed into the South Coast Air Basin every day, mostly from cars, according to the California Air Resources Board.

“We see the introduction of Shell’s new gasoline as a definite step in the right direction, though we don’t want people to think it’s the whole answer,” said Paul Wuebben, manager of the clean fuels program for the South Coast Air Quality Management District.

“It helps address a key pollution problem: the ozone-forming potential of gasoline exhaust,” he said. But, he added: “At same time, we support the development of methanol, which we consider much cleaner-burning than conventional gasoline.”

Shell’s gasoline appears to meet some of the contemplated standards recommended by the staff of the California Air Resources Board to be implemented between 1991 and 1994. In that, it closely resembles its predecessor, Atlantic Richfield Co.’s EC-1 leaded gasoline:

* Both have a lower volatility--the tendency of gasoline to evaporate as measured by Reid Vapor Pressure--of about 8 pounds per square inch from the current state standard of 9 p.s.i. The Air Resources Board is considering an 8-p.s.i. standard.

* Both include methyl tertiary butyl ether, an oxygenate designed to boost octane. The board has not decided on a standard for such chemicals, which may reduce some emissions but increase others.

In some other significant ways, Shell’s new gasoline does not go as far as Arco’s EC-1:

* Unlike EC-1, which reduced smog-producing chemicals, including sulfur and various aromatics, Shell’s gasoline keeps them at current levels.

* Similarly, levels of benzene, a carcinogenic chemical that also helps form smog, remain the same as in conventional gasoline, which is typically about 2%. Arco reduced benzene levels in its EC-1 to 1%. The Air Resources Board staff has recommended a level of 0.8%.

“They’ve taken a step or two in the direction we’re going, but they haven’t gone as far as we’re going,” said Bill Sessa, a spokesman for the board.

Albert Greenstein, a spokesman for Arco, said: “We said all along that we wanted others to join us in the reformulated gasoline market, and we’re glad that’s happening . . . . It’s good for everyone.”

Arco’s EC-1 will not compete directly with Shell’s gasoline, but Shell is apparently gaining a lead on Arco in the premium unleaded market.

“Well, there’s room for everyone,” Greenstein said. “We’re working on reformulations for our unleaded regular and unleaded supreme, and we hope to be entering the market as soon as we have a product that does the job.”

Besides the nine cities designated as having the worst air pollution problems--New York City, Hartford, Chicago, Houston, Philadelphia, Baltimore, Milwaukee and San Diego, in addition in Los Angeles--Shell’s new gasoline will also be sold in Washington, D.C.

“This new gasoline reflects Shell’s ongoing commitment to make environmental considerations a priority in the development of our new products and processes,” Richardson, the Shell president, said.

Although Shell is not the first company to introduce a cleaner gasoline on the market, its effort is the largest to date. The new fuel will account for about 40% of the company sales of premium gasoline and about 13% of its entire market share.

Last year, Arco introduced its cleaner fuel in Southern California, replacing the firm’s regular leaded gasoline, which is used by cars made before 1975.

The Phillips Petroleum Co. has already announced that it will begin marketing its brand of clean gasoline this month in the St. Louis and Denver areas. Marathon Oil Co. also is testing a lower-emissions gasoline in Detroit, and Conoco is doing so in Denver.

President Bush last year suggested Clean Air Act amendments calling for sales of 500,000 alternative-fuel cars in the nation’s smoggiest cities by 1995. He proposed that millions more be sold in subsequent years.

The Bush proposal sent shock waves through both the auto and oil industries, both of which favored keeping the status quo rather than using alternative fuels such as methanol.

Shortly after the new clean air suggestions, the Big Three domestic auto makers and several major oil companies--including Shell--met to form a task force to research and develop low-emission fuels and engines. The multimillion-dollar task force report is expected this summer.

The auto companies have argued that mandating alternative fuels would require major retooling for new car designs, and oil companies are worried about potentially huge costs for new refineries and pipelines. The oil industry has also argued that using methanol would raise serious questions about public safety and health.

Soon after the clean air proposals, testing began on reformulated gasolines that would meet federal standards.

Richard D. Wilson, the director of the Environmental Protection Agency’s mobile sources office, applauded the announcement by Shell.

“That’s fine with us,” he said. “Our job isn’t fuel selection. We’re tickled to see this kind of compliance going on. It certainly seems to fit the mood of the people in this country.”

Wilson said he believes Shell had two motives for introducing the reformulated gas. The first was good corporate public relations, given the increasing concern about the environment and the proximity of Earth Day. He said the second was an effort to keep Congress from ordering that cars use other types of fuel.

Richardson, the Shell president, said his company is not attempting to undermine the development of alternative fuels by the introduction of reformulated gasoline.

Steven L. Miller, president of Shell’s refining and marketing subsidiary, said the new gasoline had been reformulated in two ways: It has a lower vapor pressure and has been enhanced by an oxygenate that will help reduce carbon dioxide emissions. The lower vapor pressure, he said, will reduce the hydrocarbons that escape because of evaporation.

He said sales of the new gasoline are projected at more than 3.5 million gallons a day. Last year, Shell sold 10.1 billion gallons of gasoline.

Miller said that Shell was the first to introduce unleaded gasoline in 1970 and that, at the time, it was a terrible flop.

“In 1970, the environmental issue was a thought on very few people’s minds,” he said. But Miller said he believes the timing of the reformulated gasoline is right.

“It’s something we think the customer wants and needs in the 1990s,” he said.

J. Michael Kennedy reported from Houston and Patrick Lee from Los Angeles.