MNeagle
27th May 2010, 12:31 PM
May 27 (Bloomberg) -- Nalco Holding Co.’s chief met with members of Congress yesterday to convince them that its chemical dispersant should continue to be used on BP Plc’s oil spill in the Gulf of Mexico as the U.S. weighs restrictions.
J. Erik Fyrwald, chief executive officer of the Naperville, Illinois-based company, sought to reassure lawmakers that the chemical, Corexit, is “safe and effective†after the Environmental Protection Agency demanded that BP curb its use to break up the spill, company spokesman Charlie Pajor said.
“The decision to use it or any dispersant is made by the responders to a spill,†Pajor said in an e-mailed statement. “We are simply complying with their requests.â€Â
The EPA ordered BP to scale back the amount of Corexit used while the agency conducts independent tests and seeks a “better choice†of dispersant, Administrator Lisa Jackson told reporters on May 24. She said the chemical was being used at a “world record†rate and its effects on aquatic life were unknown.
“We are still deeply concerned about the things we don’t know,†said Jackson.
Nalco was already becoming more active in Washington when the Gulf spill occurred. It recently opened an office and hired Ramola Musante, a former EPA official, as its lobbyist.
The company sold $40 million of Corexit for the Gulf cleanup through last week, Pajor said. Nalco, which provides water-treatment chemicals, reported $3.75 billion in revenue last year and net income of $60.5 million.
Sales Small
While Fyrwald has said Corexit sales are too small to affect the company’s financial results, Nalco climbed 5.9 percent in New York trading on May 3 after announcing BP was applying the product and fell 5.3 percent on May 20 after the EPA called for curbing its use.
Nalco rose 92 cents, or 4.2 percent, to $22.79 at 12:51 p.m. in New York Stock Exchange composite trading after falling 14 percent this year through yesterday.
The Gulf spill provides potential revenue for Nalco of $800,000 to $6.5 million a day, Laurence Alexander, an analyst in New York with Jeffries & Co. said in a note to investors on May 18.
Corexit is approved for use in 30 countries, and “has been used successfully to treat oil spills globally for a number of years,†Pajor said.
Nalco doesn’t make public the chemical composition of the dispersant, which acts like a detergent on oil so that it breaks up more quickly.
Corexit is “a simple blend of six well-established, safe ingredients that biodegrade, do not bioaccumulate and are commonly found in popular household products,†the company said today in a statement.
Risks, Consequences
Representative Edward Markey, a Massachusetts Democrat and chairman of a House subcommittee on energy and the environment, wrote Jackson on May 17, saying he was concerned about the “risks and consequences†of dispersant use in the Gulf.
Richard Denison, senior scientist in Washington for the Environmental Defense Fund, said EPA and the U.S. Coast Guard have done little testing on chemical dispersants used on oil spills. It’s not known whether the chemical may accumulate in marine tissue and kill fish, shrimp and other marine life or enter the food supply, he said.
“Regulatory officials are making decisions on very incomplete information,†Denison said.
http://www.bloomberg.com/apps/news?pid=20601087&sid=azdJZQa0M6hw&pos=9
J. Erik Fyrwald, chief executive officer of the Naperville, Illinois-based company, sought to reassure lawmakers that the chemical, Corexit, is “safe and effective†after the Environmental Protection Agency demanded that BP curb its use to break up the spill, company spokesman Charlie Pajor said.
“The decision to use it or any dispersant is made by the responders to a spill,†Pajor said in an e-mailed statement. “We are simply complying with their requests.â€Â
The EPA ordered BP to scale back the amount of Corexit used while the agency conducts independent tests and seeks a “better choice†of dispersant, Administrator Lisa Jackson told reporters on May 24. She said the chemical was being used at a “world record†rate and its effects on aquatic life were unknown.
“We are still deeply concerned about the things we don’t know,†said Jackson.
Nalco was already becoming more active in Washington when the Gulf spill occurred. It recently opened an office and hired Ramola Musante, a former EPA official, as its lobbyist.
The company sold $40 million of Corexit for the Gulf cleanup through last week, Pajor said. Nalco, which provides water-treatment chemicals, reported $3.75 billion in revenue last year and net income of $60.5 million.
Sales Small
While Fyrwald has said Corexit sales are too small to affect the company’s financial results, Nalco climbed 5.9 percent in New York trading on May 3 after announcing BP was applying the product and fell 5.3 percent on May 20 after the EPA called for curbing its use.
Nalco rose 92 cents, or 4.2 percent, to $22.79 at 12:51 p.m. in New York Stock Exchange composite trading after falling 14 percent this year through yesterday.
The Gulf spill provides potential revenue for Nalco of $800,000 to $6.5 million a day, Laurence Alexander, an analyst in New York with Jeffries & Co. said in a note to investors on May 18.
Corexit is approved for use in 30 countries, and “has been used successfully to treat oil spills globally for a number of years,†Pajor said.
Nalco doesn’t make public the chemical composition of the dispersant, which acts like a detergent on oil so that it breaks up more quickly.
Corexit is “a simple blend of six well-established, safe ingredients that biodegrade, do not bioaccumulate and are commonly found in popular household products,†the company said today in a statement.
Risks, Consequences
Representative Edward Markey, a Massachusetts Democrat and chairman of a House subcommittee on energy and the environment, wrote Jackson on May 17, saying he was concerned about the “risks and consequences†of dispersant use in the Gulf.
Richard Denison, senior scientist in Washington for the Environmental Defense Fund, said EPA and the U.S. Coast Guard have done little testing on chemical dispersants used on oil spills. It’s not known whether the chemical may accumulate in marine tissue and kill fish, shrimp and other marine life or enter the food supply, he said.
“Regulatory officials are making decisions on very incomplete information,†Denison said.
http://www.bloomberg.com/apps/news?pid=20601087&sid=azdJZQa0M6hw&pos=9