From the USA AvWeb News Wire Thursday, January 27, 2000 Australian Piston Fleet Begins Slow Taxi To Recovery Aussie Avgas Crisis Eased By New Cleanup Procedures... Procedures were finally announced this week for cleaning aircraft grounded by Australia's fuel-contamination disaster. The Civil Aviation Safety Authority (CASA) approved two test procedures to check an aircraft for fuel-system contamination, and released two airworthiness directives describing how to return planes to service. Most of the piston aircraft in Southeastern Australia have been grounded since before Christmas, when ethylene diamine contamination was discovered in 100/130 avgas supplied by Mobil. The two simple tests for the offending chemical are the result of sophisticated petrochemical research done by Professor David Trimm of the University of New South Wales. The mysterious white gel that had also been noted in some tanks has been identified as a commonly found aluminum hydroxide compound that is not part of the fuel-contamination problem. The fuel-contamination scare has even affected the parts of Australia where no bad avgas was distributed. Much of the public has been boycotting general aviation aircraft, grounded or not, and CASA issued a press release urging people in unaffected areas to get out and fly. CASA's Director of Aviation Safety Mick Toller said, "The present fear of flying by some Australians is only making a bad situation for the aviation industry worse. CASA will only allow aircraft to be operated that are safe and reliable." Toller had hoped to boost confidence in the system Monday by flying the first airplane cleared by the new test procedures. The effort fell flat in front of the TV cameras when mechanics frantically called him back during his taxi out. Parts had been cannibalized from the Seneca he was piloting, and it was not airworthy. ...But Many Questions Remain For Owners... It sounds strange to pilots -- who are trained that water and fuel together is an abomination -- but the decontamination procedure is basically to flush all the fuel-system components with water. The fuel system must also be disassembled and inspected, and damaged components must be replaced. CASA is quick to point out that compliance with the return-to-service ADs could well void an owner's aircraft or engine warranty, and its only advice is to check with the aircraft's manufacturer or insurer. Test kits are scarce, and it's still not known how long it will take for operators who are bleeding money daily to get back in the air. Owners are also worried that replacements for damaged parts on many of the older aircraft in the fleet may be hard to find. ...While Mobil Promises To Pay The Bill (Maybe) Mobil Oil Australia announced on Tuesday that it would pay for the testing and cleaning of those aircraft afflicted with the tainted fuel. The company said it was working hard to supply test kits to the affected areas as quickly as possible, with some kit components coming from overseas. Claims are also coming in to the company's $9.8 million fund set up to compensate those suffering financial hardship from the grounded aircraft. Problems getting payment from the fund, and concerns that the fund's size is too small to cover the industry's losses, have prompted the filing of two class-action suits against Mobil. --------------------------------------------------------------------------- From the Australian By NICOLE STRAHAN 25jan00 Battle shifts to courts THE legal fight between the aviation industry and oil company Mobil began in earnest yesterday after class actions claiming hundreds of millions of dollars in damages were lodged in two courts. Together, the class actions represent thousands of aircraft owners, charter companies, flying training businesses and aerial agriculture operations devastated by the aviation fuel crisis. The class actions began despite Mobil's $15 million compensation package, which legal representatives for the parties described as inadequate. Law firm Maurice Blackburn Cashman lodged a $100 million class action in the Federal Court in Melbourne on behalf of about 3000 aviation businesses, claiming Mobil breached its obligations under the Trade Practices Act. Firm partner Bernard Murphy said he was confident the class action would be successful. "The case is a walk-up start. This crisis is entirely the result of Mobil's failure to properly supply fuel of a proper quality and standard," he said. Slater & Gordon lodged a separate class action for unspecified damages in the Melbourne Supreme Court on behalf of the Aircraft Owners and Pilots Association, which has 17,000 members. The writ claims Mobil was negligent when it supplied contaminated fuel to its customers between November 21 and December 23. Firm spokesman Peter Gordon said AOPA initially wanted to avoid legal action but was left with no option because Mobil was unwilling to discuss compensation beyond its $15 million package. --------------------------------------------------------------------------- From the ABC Fri, 28 Jan. Mobil outlines fuel compo package Mobil has released details of its compensation package for those affected by contaminated aviation fuel. Mobil says it does not know how much will be paid out at this stage, but final settlement will be dependent on claimants dropping legal action. The program will be overseen by an independent auditor, with no ceiling on payouts. Those eligible to apply include aircraft owners and operators, crop dusters, and contractors who provide services to operators. Mobil corporate affairs manager Alan Bailey has rejected claims the compensation package is designed to avoid legal action. "We have been working for some time on the development of an appropriate compensation program for our customers," he said. "I don't think it's reasonable to suggest that this is a cynical attempt to avoid class actions. Clearly, we prefer to deal directly with our customers on this. We think it's in their best interests." ------------------------------------------------------------------------------- From the ABC Sat, 29 Jan. Lawyers appeal to speed up proceedings against Mobil The law firm representing thousands of light plane operators will ask the NSW Supreme Court on Monday to speed up proceedings against Mobil. The plans come after Mobil offered a new compensation package to parties affected by the aviation fuel crisis. Mobil wants affected parties to claim for damages rather than sue. So far, the company has not put a limit on the amount it will pay out. The compensation program will be overseen by an independent auditor, and final settlement will require claimants to forfeit any right to legal action. Repeated through out the offer document is Mobil's denial of any liabily. Peter Gordon, from the legal firm lodging the class action against Mobil, says, the company's trying to get away with paying less than it might have to pay if found liable in court. But Mobil says it is not an attempt to avoid a class action. The law firm will ask the NSW Supreme Court on Monday to speed up proceedings against Mobil. Application forms for the compensation program will be available on Tuesday. ------------------------------------------------------------------------------- From the Australian By Aviation writer STEVE CREEDY 31jan00 Mobil straps into the hot seat MOBIL executives are expected to face stiff questioning today when they testify before a Senate committee hearing about the company's handling of the aviation fuel contamination crisis. Executives Paul Wherry and Malcolm Garrow will be grilled about the contamination that grounded more than 5000 piston engine aircraft. Committee members are interested in Mobil's explanation of why the crisis occurred, the adequacy of the company's response and what sort of procedural, testing and regulatory regimes had been in place. Evidence was given at a previous hearing that some Civil Aviation Safety Authority officers were urging superiors to test fuel supplies as long ago as 1997 but were overruled because of cost-cutting. The Mobil executives will be joined by CASA, Aircraft Owners and Pilots Association (AOPA) officials and independent petrochemical expert Professor David Trimm, who was called in by CASA to validate the testing procedures for contaminated aircraft. The hearing takes place as two class actions launched on behalf of aircraft operators return to court in Melbourne. The legal push looks likely to continue, possibly as a joint action, despite Mobil's announcement on Friday of a compensation offer for businesses' losses. Operators are concerned about the offer, saying it lacks detail and its administration is not sufficiently independent. AOPA is also unhappy the offer is conditional on operators signing away their rights to take further legal action. AOPA president Bill Hamilton yesterday repeated warnings that operators should not sign away their rights and said the association would be raising its concerns at the Senate hearing. Mr Hamilton said AOPA had received reports that operators were being asked to waive their legal rights without knowing the details of Mobil's offer. "That leaves people between a rock and a hard place," he said. "They want compensation quickly, they don't know what Mobil's going to offer them but to get any offer at all they have to leave themselves with no appeal." CASA said on Friday that at least 605 aircraft had been tested and 189 had been cleared of the contaminant ethylene di-amine. Fifty-six aircraft had been cleaned and returned to service. ---------------------------------------------------------------------------