Mobil could face huge bill following fuel contamination incident - Brief Article

Airline Industry Information, Jan 12, 2000

AIRLINE INDUSTRY INFORMATION-(C)1997-2000 M2 COMMUNICATIONS LTD

The Aircraft Owners and Pilots Association of Australia (AOPAA) has said that the Mobil light aviation fuel crisis could cost more than AUD50m.

A spokesperson for AOPAA said that `every month that this contamination grounding problem continues there is AUD50m in lost income to the national economy.`

The contamination is applicable to Mobil Oil Australia Ltd`s 100/130 avgas produced at the Altona refinery between 21 November and 23 December 1999. The 5,000 or so light aircraft operators which used this fuel have been ordered by the Civil Aviation Safety Authority to ground their aircraft until further notice.

A new test on the fuel is expected to be available by the end of the week, but CASA say that `it could take weeks, even months to get some of (the) aircraft cleaned and back in the air.`

Meanwhile, the director of CASA has apparently said that Mobil should be responsible for the costs incurred by aircraft operators and owners while Mobil has already agreed to pay for the costs of cleaning affected aircraft and replacing the fuel. The company is likely to face further costs however with Ferrier & Associates, a Sydney law firm, gathering information to launch a `representative action` against the company.

Mobil estimates that the contamination affected about six million litres of fuel sold in New South Wales, Victoria and southern Queensland. Mobil also supplies avgas to BP Australia, a unit of BP Amoco Plc.

Shell Australia, which supplies about 33% of the avgas market, has said that its fuel is contamination-free and that it has the ability to supply the entire Australian market if the problem persisted.

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