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Williams Bio-Energy LLC, a unit of The Williams Cos. Inc. said it has agreed to supply ethanol to California by the fourth quarter of 2001.
The decision came days after the U.S. Environmental Protection Agency (EPA) denied California's request to be waived from provisions of the 1990 Clean Air Act requiring the use of additives to make cleaner-burning gasoline.
The decision means California will need about 580 million gallons of ethanol for reformulated gasoline (RFG) oxygenates in 2004, because use of the alternative additive methyl tertiary butyl ether (MTBE) will be banned in the state by Dec. 31, 2002, according to Reuters.
"We're bringing supply to California more than a year ahead of the MTBE phase-out, allowing refiners to switch from MTBE to ethanol ahead of schedule," Williams Bio-Energy LLC vice president Ron Miller said in a written statement.
Under the agreement, Williams will house 15,000 barrels of ethanol at Kinder Morgan Energy Partners storage facility in Carson, Calif., in order to supply the Los Angeles and San Diego markets.
Williams plans to transport ethanol to the storage facility and directly to refiners by large unit rail shipments and ocean vessels.