State wants Unocal cleanup before sale

Uneasy over the possibility that a government-owned, Chinese firm may be buying California oil company Unocal, the State of California is seeking cleanup before any deal goes through:

California Atty. Gen. Bill Lockyer, along with the top law enforcement officers of Montana, New Mexico and Texas, sent a letter to Unocal President Joseph H. Bryant seeking assurances that Unocal would continue to pay for cleanup at Unocal waste sites in their states. Tom Dresslar, Lockyer's spokesman said the letter was sent by fax late Wednesday to Bryant's office in Sugarland, Texas.

CNOOC, which is 71% owned by the Chinese government, has offered to buy El Segundo-based Unocal for $18.5 billion in cash. Unocal officials are weighing the bid against an acquisition proposal from San Ramon, Calif.-based Chevron Corp., which in early April offered to buy the company in a stock and cash deal that was worth $16.5 billion as of Wednesday.

"Should CNOOC's offer be accepted, we are deeply concerned that the funding for cleanup of the sites in our respective states may be jeopardized," the officials said in the Unocal letter. "We urgently need assurances that a CNOOC-owned Unocal could and would honor all of Unocal's current and future environmental obligations."