OTTAWA — A negotiated settlement between the Canadian government and six makers of diesel engines alleged to have intentionally circumvented emissions rules could come as early as mid-summer, according to the head of Transport Canada’s energy and emissions department.

Transport Canada contacted the engine companies last November, a few weeks after they agreed to spend more than $1 billion US to settle claims by the U.S. Environmental Protection Agency and Dept. of Justice that they used a loophole in government testing procedures to meet emissions standards under laboratory conditions yet “defeat” pollution controls at highway speed, a violation of the U.S. Clean Air Act.

The manufacturers are Cummins Engine, Caterpillar, Detroit Diesel, Navistar International, Volvo Trucks, and Mack Trucks.

“There are no differences between emissions standards in Canada and the United States, so there should be no difference in the way penalties such as these are applied,” said Lui Hrobelsky, chief of energy and emissions engineering at Transport Canada.

“Our expectations are to arrive at a Canadian solution that has the same results as what has been agreed to in the U.S. How exactly that will translate into action has yet to be determined.”

The settlement with the EPA requires the manufacturers to collectively pay $83.4 million in fines and spend another $959 million on research and development of new cleaner engines.

The manufacturers must also meet 2004 emissions targets, which cut emissions by 80% compared to current levels, by Oct. 1, 2002 — 15 months sooner than planned. EPA did not order a recall of existing engines, but engine makers are responsible for fixing pollution-control software when engines are rebuilt.

“We want to arrive at an agreement that has the same impact in Canada,” Hrobelsky said. “If the negotiations go smoothly, we could have something done by the middle of the summer.”

Hrobelsky acknowledged that if the engine manufacturers agree to meet tougher standards at an accelerated rate, and to increase spending in research and development of cleaner-burning engines, the only remaining element that would be distinct to Canada is a monetary settlement.

He said, however, that “the ultimate goal is to arrive at something that has an overall benefit, not simply a monetary settlement.”

Meanwhile, the manufacturers have claimed no wrongdoing. Several have said they were penalized for a practice the EPA had known about for years, and settled in order to avoid a protracted and costly legal dispute.

Hrobelsky said such allegations are moot now.

“What we have is a negotiated solution. The posturing on either side is certainly interesting, but not relevant,” he said. “We’re working with what was agreed to. That’s where we’re picking up on the process.”