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New Mexico, Chevron settle case over cleanup costs

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September 11, 2013 07:46 PM EST | AP

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SANTA FE, N.M. — New Mexico officials say Chevron Corp. will pay $5.2 million to settle claims that the energy company improperly applied for money from an environmental cleanup fund.

The state alleges Chevron falsely claimed it didn't have and didn't collect on insurance to pay for cleaning up petroleum contamination from the company's leaking underground storage tanks at gas stations around the state. The state says the company received payments from insurers through secret settlements.

The state says it paid out $4 million after Chevron filed dozens of claims to tap into the cleanup fund. Some claims date back to the early 1990s.

A Chevron spokeswoman says the company complied with the law and acted in good faith when seeking the reimbursements.

The settlement was announced Wednesday by Attorney General Gary King and the state Environment Department.