Texaco Sued Over Pollution - Oil Waste Dumped

By Letta Tayler, Newsday
22 May 2005

San Carlos, Ecuador - Texaco's legacy in the Amazon oozes from an oil pit near Ruperto Narvaez's shack like pus from a sore.

When the rains come, as they often do in this remote jungle town, black goo overflows from the pit into a nearby stream that serves as Narvaez's main water source. Narvaez believes that's why his cattle are sickly, why his cacao plants languish, and why his children suffer chronic headaches and skin rashes.

"The only things that grow here are sickness and misery," said Narvaez, a scrawny farmer with a face creased by defeat, as he jabbed his machete into the muck. "When is someone going to clean this up?"

After a decade of legal logjams, Narvaez may finally get his answer. A landmark lawsuit slouching through an Ecuadoran court seeks $6 billion in cleanup funds from the former U.S. petroleum giant Texaco Inc., alleging it created Latin America's worst environmental disaster when it dumped billions of gallons of oil waste into Ecuador's Amazon rainforest from 1972 to 1990.

ChevronTexaco denies any wrongdoing and points out that health studies finding increased incidence of cancer, miscarriages and other problems are not conclusive. It notes the Ecuadoran government exonerated Texaco of any liability after it spent $40 million cleaning up more than one-third of its 627 oil pits in the area in the mid-1990s, equal to its share in the drilling consortium.

The unprecedented suit was filed on behalf of 80 communities and five indigenous groups in Ecuador's Amazon, one of the world's most fragile and environmentally diverse ecosystems.

A ruling for the plaintiffs "would be a wakeup call to corporations that have been, or continue to be, lax in developing countries," said Eric Dannenmaier, director of the Institute for Environmental Law and Policy at Tulane University in New Orleans.

The lawsuit alleges that to save money, Texaco dumped more than 18 billion gallons of waste into pits, swamps, rivers and streams in an area the size of Rhode Island. The waste included an estimated 16 million gallons of crude oil, more than 1 ½ times the amount spilled in the Exxon Valdez disaster.

The actions suggest that "to certain decision-makers in Texaco, the lives of the people in the rainforest weren't worth as much as the lives of people in their own country," said Steven Donziger, a Manhattan-based attorney representing the plaintiffs. Such dumping practices were no longer the norm during the 1970s and 1980s in the United States, Donziger said.

Despite the seriousness of the charges, a carnival atmosphere sometimes pervades the trial, which began 1 ½ years ago and is expected to last well into next year. Most proceedings take place at Texaco's former drilling and production sites.

Dressed in floppy sun hats and galoshes, lawyers, expert witnesses and the judge slosh through steamy jungle swamps to inspect oily ponds and separation pits.

Demonstrators - who have included such celebrities as Bianca Jagger, as well as bare-chested Amazon Indians decked in face-paint and brilliant feather headdresses - wave banners condemning "Chevron-Toxico."

Both sides have resorted to grandstanding.

Plaintiffs' lawyers label Texaco's former drilling sites "The Rainforest Chernobyl" because of the volume of dumped waste and suspiciously high cancer rates in the company's drilling areas, even though the sobering health and environmental problems in the area can't compare with the 1986 Chernobyl nuclear disaster.

ChevronTexaco, meanwhile, revels in such tactics as showing the judge a 10-foot-long map of massive spills by the Ecuadoran state oil company, Petroecuador, after it took over Texaco's operations in 1990. The aim is to underscore ChevronTexaco's argument that any contamination in its former drilling areas is the fault of its successor.

Whatever the outcome, the proceedings expose the risks of oil production in developing countries with little technical savvy or will to question powerful foreign corporations.

Ecuador was desperate for revenues from Texaco's operations in the Ecuadoran Amazon, which represented more than half its gross national product at the time. Discovery documents show that "Tex-AH-co," as Ecuadorans call the company, sweetened that relationship further by lavishing former government officials with contracts and designing the entire oil extraction system for the region, virgin territory so wild and remote it is still known simply as "El Oriente" ("The East").

"The government trusted Texaco to do the right thing, and it betrayed that trust," said Atossa Soltani, executive director of the environmental group Amazon Watch.

ChevronTexaco officials counter that if any contamination did occur during Texaco's time in the Oriente, it was the responsibility of Petroecuador because it owned nearly two-thirds of the Texaco consortium.

"Petroecuador directed and controlled every step of our operations," said Rodrigo Perez, a lawyer for ChevronTexaco.

That's one reason ChevronTexaco has asked a U.S.-based arbitration panel to transfer any liability for further cleanup costs to Petroecuador. Ecuador obtained an injunction that temporarily blocks ChrevonTexaco's request. However, should ChevronTexaco prevail in arbitration, some political observers fear the Ecuadoran government might pressure its courts to not issue any damage judgment to avoid having to foot the cleanup bill.

Some discovery documents provided by the plaintiffs in the 10-year-old lawsuit suggest Texaco was indeed running the show during its years in Ecuador.

In 1976, Texaco rebuffed Ecuadoran government requests that it close and replace several unlined oil pits whose embankments were breaking, causing polluted waste to spill onto surrounding areas. It opted instead to reinforce the pits because the government's proposals would be "prohibitive."

Texaco is estimated to have earned a total of $30 billion from its operations in the Oriente.

Home to few but missionaries and indigenous tribes in the 1970s, the Oriente still boasts a wild and potent beauty. Tropical flowers and fruit trees that burst from the jungle defy the notion of total contamination.

Nevertheless, the region has been indelibly branded by Texaco's operations. Pipelines cut through dozens of communities. Gas flames shoot into the sky from processing plants hacked out of jungle foliage. Hundreds of open pits filled with oil waste litter the landscape.

Lured by Texaco's roads and jobs as well as by generous government homesteading programs, settlers flocked to the region to raze trees and raise cattle, driving indigenous groups farther into the jungle and pushing some, according to plaintiffs, to the verge of extinction.

Like the Indians, the settlers bathed in and drank the water in which Texaco was dumping its wastes. They planted their crops and let their cattle graze on soil that barely covered some of the oil pits, and let their children play in the sticky mud.

"We didn't know any better. Every day, we poisoned ourselves a little more," said Rosana Sisalima, a fragile woman of 65 who settled in San Carlos with her husband in the early 1980s.

Doctors removed Sisalima's uterus a few years ago because of cancer; her husband died of stomach cancer in 1990. Sisalima blames both malignancies on the Texaco waste. So do many other residents with health problems in San Carlos, a community with 3,000 people and 30 Texaco wells.

In the past 12 years, at least three international studies of Texaco's drilling areas in the Oriente found suspiciously high rates of cancer, miscarriages, birth defects and skin diseases - findings corroborated by local doctors.

However, as ChevronTexaco points out, none of the health studies is conclusive. Moreover, the company argues, much soil and water in the area appear to be contaminated by pesticides, sewage or subsequent oil operations in the same area by Petroecuador.

On a recent visit to the Oriente, Petroecuador's environmental track record appeared far from exemplary. Numerous residents in San Carlos said Petroecuador's trucks dump oil wastes along roadsides at night - allegations the company denies, though it has acknowledged scores of spills in recent years.

During an inspection of the Sacha Central Production plant in February as part of the case against Texaco, a Petroecuador truck drove up and, in front of the judge, disgorged a load of drilling waste into a pit that fed into a stream rather than reinjecting it deep into the ground, the method considered environmentally safer.

Plaintiffs contend that Texaco should have reinjected its waste in the Oriente, too. Reinjection was already standard procedure by the 1970s in the United States, and Texaco even participated in a U.S. Environmental Protection Agency panel touting the practice in 1971, they argue. But reinjection would have cost Texaco an extra $4.5 billion over two decades.

The company is proud to show reporters some of the sites it remediated under orders from Ecuador in 1995-98. On one, for example, an open pit filled with drilling mud had been transformed into a field with plants and banana trees.

But the trees' owner, Teresa Vasquez, a mother of three whose house is just yards from the site, insisted the soil is still contaminated. "Just look at the trees: They don't grow tall and the leaves get yellow," she said, pointing to some withering foliage. "We'd like to move, but who would buy this land from us now?"

Even ChevronTexaco's recent soil tests from several areas Texaco remediated show current levels of total petroleum hydrocarbons - toxic chemicals derived from petroleum - that are more than 1,000 times higher than Ecuadoran limits.

ChevronTexaco officials note that Ecuador established those limits long after Texaco's remediation and said it would be unjust to apply them retroactively. Environmental law experts, however, say numerous legal precedents exist for applying current standards to past remediation.

In a region scarred by poverty and government neglect, blame may lie on many fronts. For example, tens of thousands of Oriente residents wouldn't be bathing in, and sometimes drinking from, contaminated streams and rivers if the Ecuadoran government had expanded its scarce public drinking-water supplies.

"The river water is dirty, but it's this or nothing," said Nelly Surita, a mother of three, as she stood in a river in San Carlos, washing clothes. Around her, several school boys dove into the water as a respite from the tropical sun.

Surita suspects bathing in the river made her 8-year-old daughter's hair start falling out in clumps. Still, she wants oil drilling to continue in the Oriente to keep jobs in the region. "They just need to take care of the waste," she said.

Narvaez, 65, who moved here 15 years ago in search of cheap, fertile land, only to end up with an oozing oil pit, wonders if that will happen in his lifetime.

"This land was supposed to change our lives," he said. "But not for worse."

Distributed by the Los Angeles Times-Washington Post News Service

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