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    Tesoro Sues Pentagon

    Refiner claims the Defense Department has underpaid for fuel for 16 years.

    SAN ANTONIO -- Tesoro Petroleum Corp., an independent refiner/convenience store operator that has rapidly grown to more than 250 stores, is seeking more than $143 million from the Defense Department in a lawsuit that accuses the Pentagon of underpaying for jet fuel for 16 years.

    Tesoro's lawsuit is similar to those filed by other oil refiners who say they were cheated under contracts with the Defense Energy Support Center.

    The companies say the agency adjusted the prices it paid each month for jet fuel based on information that often underestimated going prices for crude oil, according to the Associated Press.

    Tesoro's complaint centers on fuel sold to the government from Tesoro's refineries in Alaska and Hawaii from 1983 to 1999. The company's sales under the contracts in that period reached $1 billion. Pentagon officials declined to comment on the specifics of the lawsuit, but spokeswoman Lynette Ebberts said the support center stood behind its pricing system, the report said.

    Companies taking similar action include Chevron Texaco Corp., The Williams Cos., Sunoco Inc., Koch Oil Co., Crown Central Petroleum and Phillips Petroleum Co. Valero Energy Corp., the largest U.S. independent refiner, is currently reviewing its military jet fuel contract, the report said.

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