Chevron in Ecuador

The archive of the Clean Up Ecuador campaign website

Chevron Rejects Liability Claim

31 October 2005

US supermajor Chevron has failed to disclose a potential multibillion dollar liability over alleged environmental contamination in Ecuador's Amazon jungle, according to the environmental organization Amazon Watch.

The group says Chevron could be liable for clean-up costs of $6 billion to $10 billion as a result of a lawsuit originally filed against Texaco, which merged with Chevron in 2001. The suit alleged that Texaco caused contamination in the Lago Agrio region, where Texaco operated from 1964 to 1990.

Amazon Watch sent a letter to Chevron's General Counsel Edward Scott, raising the issue and pointing out the company's potential liability.

Chevron contends that the potential liability it faces is not significant enough to merit public disclosure in regulatory filings. "We face hundreds of lawsuits and we don't disclose potential liability
in any. We don't believe this case reaches the level of impact where we have to disclose it to the Securities and Exchange (SEC) Commission," company spokesman Russ Yarrow told Oil Daily.

Under a 1996 remediation agreement with the government of Ecuador, Texaco agreed to spend $40 million to clean up the site. But a damage assessment carried out by Global Environmental Operations in 2003 showed evidence of toxins in the area, which is home to five indigenous
groups. Chevron maintains that its own inspection of the site showed no evidence of harmful substances.