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Chevron to pay $1.7 million to Mass.

Chevron USA Inc. and Texaco Downstream Properties Inc. will repay the state $1.7 million to settle a lawsuit alleging they accepted money from a public fund for gas station cleanups without disclosing reimbursements from their insurers, Attorney General Martha Coakley said Wednesday.

The Massachusetts Underground Storage Tank Petroleum Product Cleanup Fund uses money collected from gas tank registration and delivery fees to compensate gas station owners and operators for the costs of cleaning up environmentally hazardous leaks. Claimants must notify the state if they seek reimbursements from other sources, including insurance companies, and return money to the fund if they succeed.

Coakley alleged Chevron and Texaco, before and after their 2001 merger, made improper claims. The merged company, Chevron Corp., of San Ramon, Calif., will pay $825,000 to the cleanup fund and $875,000 to the state’s general fund.

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A spokesman for Chevron denied any wrongdoing, saying Chevron “acted at all times in good faith and believes its dealings with the state’s underground storage tank fund have been proper and without fault.”

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“It is advantageous for both sides, however, to bring this matter to a conclusion, and we have done so,” said the spokesman, Brent Tippen.

The settlement is the second Coakley has won from oil companies she alleged misused the cleanup fund. In April, Sunoco Inc., of Philadelphia, agreed to a $2.2 million settlement in a similar case. Coakley also has sued Hess Corp., of New York, for false cleanup fund claims. Hess could not be reached for comment Wednesday.

Callum Borchers

Callum Borchers can be reached at callum.borchers@globe.com. Follow him on Twitter @callumborchers.