Three Refiners Given Extension to Produce Cleaner Diesel

The state Air Resources Board said Tuesday it will give three major California refiners extra time to meet new standards for cleaner-burning diesel, extending their deadline beyond the Oct. 1 date faced by other oil companies.

Until they meet the standard, the three refiners--Chevron Corp., Unocal Corp. and Ultramar Inc.--will have to pay a fee that will be applied toward other methods of cutting air emissions.

Environmentalists as well as Atlantic Richfield Co., which says it will meet the original deadline, expressed disappointment with the decision.

But Jananne Sharpless, chairwoman of the ARB, said the variances are necessary to ensure adequate supplies of fuel while providing a smooth transition to the reformulated diesel standard.

The new ARB regulations aim to reduce bus and truck emissions that include soot-like particles, smog-forming hydrocarbons and such toxics as benzene. Under the ARB extensions, only half the diesel on sale at the October deadline will be reformulated to meet the new standards. Chevron will be allowed to produce some conventional diesel through June, 1994; Ultramar, through July, and Unocal, through next August.

Chevron and Unocal will pay an “environmental mitigation fee” of 6 cents a gallon, and the smaller Ultramar will pay 5 cents a gallon, on the conventional diesel they produce in the interim. ARB spokesman Bill Sessa said no specific projects to reduce air pollution have yet been earmarked to receive the fees.

Robert J. Trunek, Arco senior vice president, said Tuesday that the decision sets a bad precedent.

“Arco made a $70-million investment in its Los Angeles refinery,” Trunek said, “fully expecting the deadline to be honored.” The company objected in part to what it called interference with the free market for diesel by relaxing the requirements for the refiners, which together produce 50% to 80% of the diesel sold in California.

Environmentalists objected to the concessions as well.

“We strongly urge the Air Resources Board to be more conservative in cutting deals like this,” said Tom Soto, president of the Coalition for Clean Air, “and to be sure that the refiners meet these (new) deadlines.”