Newport News Shipbuilding could avoid limits on the discharge of the toxic boat paint TBT, while the state and the Environmental Protection Agency look for alternative ways to reduce the chemical in state waters.

Two months ago, the EPA ordered state regulators not to issue a new water pollution permit to the shipyard because it included no limits on TBT, short for tributyltin. Last week, the EPA told the state it could issue the permit without the limits if it agreed to undertake a "TBT assessment and reduction program."The details of that assessment have yet to be worked out, said Robert Koroncai, the EPA's chief of permits enforcement for the mid-Atlantic region. But Mr. Koroncai said the assessment could do more to reduce TBT in the water than simply placing limits on shipyards.

"I truly believe that if we put a limit in the permit now, that we would not solve the TBT problem, because there are other sources," Mr. Koroncai said. "Under this scenario, I believe that we're going to much better understand what the source of the problem is, and with that information in hand, we are more likely to go after that source."

But environmentalists believe enough is already known about TBT to conclude that shipyards are a significant source of the chemical. Joe Maroon, executive director of the Chesapeake Bay Foundation, said he supports studying TBT further but believes the state should limit discharges from shipyards in the meantime.

"They're still a significant part of the problem," Mr. Maroon said. "If allowed to discharge TBT at greater levels, then certainly they will become a greater part of the problem in the future."

TBT gets into the water from a number of sources, including the hulls of ships and rainwater runoff from shipyards.

The state requires Newport News Shipbuilding to follow certain procedures to minimize the amount of TBT that enters the water but does not place numerical limits on how much ends up there. The shipyard uses the paint on a small number of commercial jobs each year, mostly on ships that frequent tropical waters, like cruise liners.

The shipyard would cooperate with the EPA study, said spokeswoman Jerri Fuller Dickseski, but believes the TBT limits once contemplated by the state were too low. They were so low that river water passing the shipyard could have resulted in a violation, Mr. Dickseski said.

Mr. Koroncai said Newport News Shipbuilding could face TBT limits in the future, if the assessment points to shipyards as a source of TBT pollution.

The state Department of Environmental Quality still is considering the EPA's proposal, said Robert Burnley, director of Program Support and Evaluation.

"We will decide what Virginia thinks is the most appropriate course to take," Mr. Burnley said. "And then we'll go about the process of negotiating a resolution of the issue."

The EPA's proposal applies only to Newport News Shipbuilding, though Mr. Koroncai hopes the state will make a similar arrangement with other yards.

"It's hard to say what all the permits are going to look like in the future," he said. "But any deal we cut with this Newport News permit, we would look for the same deal to be cut."