Citgo Petroleum Corp. will install $320 million in pollution controls in six refineries and pay $3.6 million to settle a federal lawsuit charging the company with violating the Clean Air Act, the Justice Department announced yesterday.

The agreement should cut sulfur dioxide and nitrogen oxide air emissions, both of which are linked to respiratory ailments and childhood asthma, by more than 30,000 tons a year, officials said. The settlement affects 5 percent of the nation's refinery capacity and means that 41 percent of the country's oil refinery production is on schedule to meet federal air quality standards. Only 17 percent of the nation's refinery output was complying with the Clean Air Act at the outset of the Bush administration, the officials said.

"Today's settlement means we're one step closer to bringing all of America's oil refineries in compliance with our Clean Air Act standards, which means cleaner air for our communities and citizens," said Thomas L. Sansonetti, assistant attorney general for the Justice Department's Environment and Natural Resources Division. "Companies that break environmental laws not only endanger public health, but they also harm our precious natural resources."

The federal government has settled cases with 12 oil refiners since December 2000, the largest a $400 million agreement with Motiva Enterprises. Thomas Skinner, the Environmental Protection Agency's assistant administrator for enforcement, said the settlements have reduced air pollution in 24 states by 200,000 tons a year.

Citgo president Luis Marin said in a statement his company -- which will retool refineries in Savannah, Ga., Lemont, Ill., Lake Charles, La., Paulsboro, N.J., and Corpus Christi, Tex. -- "has an unwavering commitment to operating our facilities in full compliance with environmental regulations."

The country's fourth-largest gas retailer did not admit to any Clean Air Act violations, but Marin said "these additional improvements will ensure that the corporation reaches its goal of becoming an exceptional environmental steward."

Activists in Texas have been pushing Citgo to clean up carcinogenic benzene wastes at its plants, something the company has agreed to do along with upgrading its protection against leaks.

Eric Schaeffer, who directed the EPA's enforcement office between 1997 and 2002 and now heads the Environmental Integrity Project, an advocacy group, said the Clinton administration initiated many of the oil refinery investigations, and the biggest violators -- ExxonMobil and Sunoco -- have yet to settle. Refineries rank as the nation's second-largest stationary source of sulfur dioxide pollution, after power plants, he said.

Schaeffer said he was glad Justice and the EPA obtained "a big settlement" with Citgo, but "I just wish they had done it sooner. It could have happened earlier if they had the political backing they needed."

Skinner said the administration was "pushing as hard as we can to get these settlements done as quickly as we can." He noted that the refineries have been more cooperative than utilities, which have mostly opted to battle in court when charged with Clean Air Act violations.