Chevron's Ecuador Environmental Problems Pose Risks for Company's Strategic Projects In Australia
Prominent Australian Journalist Mike Monro Blasts Chevron On Television for Refusing to Clean Toxic Mess
Amazon Defense Coalition
26 October 2011 - FOR IMMEDIATE RELEASE
Contact: Karen Hinton at +1.703.798.3109
New York, NY – Chevron's $18 billion environmental liability in Ecuador is causing a whale of trouble for the oil giant's image in Australia where it still must clear regulatory hurdles to realize profits from two strategically critical natural gas projects.
The popular Australia news magazine show Sunday Night – the equivalent of 60 Minutes in the U.S. – recently aired a segment sharply criticizing Chevron's stonewalling in the face of demands by indigenous groups in Ecuador that it clean up billions of gallons of toxic waste systematically dumped in the 1970s and 1980s that still contaminate the waterways of the rainforest.
The dumping occurred when Chevron operated a large oil concession in the South American nation from 1964 to 1992, under the Texaco brand. Chevron bought Texaco in 1992.
In a segment titled "The Amazon's Toxic Mess," reporter Mike Monro noted: "While Chevron is establishing its environmental credentials in Australia, in the Amazon it's fighting hard ball to avoid paying billions to clean up this toxic catastrophe."
Monro reported in reference to the area of Ecuador where Chevron operated more than 370 well sites and oil production facilities: "What was once pristine, full of wildlife and beauty, has been left for decades in a state of oil-soaked decay. And you don't have to travel far to see the impact on the lives of people who live around the pits."
Chevron recently greenlighted a $30 billion liquified natural gas project in Australia – called Wheatstone – that involves the construction of an underground pipeline connecting gas fields roughly 80 miles offshore with an onshore processing plant. Environmental groups say the pipeline threatens the largest nursery for humpback whales in the world, would decimate a thriving population of sea turtles, and would create a marine "dead zone" on the ocean floor.
The project also would negatively impact aboriginal peoples, according to studies.
Chevron's stock received a major boost when the Wheatstone project was given the go-ahead, but revenues are not expected until 2016. Largely because of the project, Australia now represents one of Chevron's largest overseas investments, according to the company's latest annual report.
A court in Ecuador recently imposed on Chevron an $18 billion judgment for systematically dumping toxic waste into the waterways and forests of the rainforest at a rate of 4 million gallons daily for roughly two decades. The court found that the contamination decimated indigenous groups and caused an outbreak of cancer and other oil-related illnesses that continue to pose grave risks to thousands of people.
An expert report presented by the affected communities determined that up to 10,000 persons in the area where Chevron operated will contract cancer in the coming decades if the pollution is not remediated.
The segment on Australia's Sunday Night showed dramatic footage of some of the hundreds of unlined toxic waste pits that Chevron gouged out of the jungle floor in Ecuador and then abandoned when it left the country in 1992. Most of the pits continue to drain toxic sludge into nearby waterways that the local inhabitants rely on for their drinking water.
Turning to Chevron's Wheatstone Project in Australia, Monro asked Chevron spokesman James Craig: "How can we trust you with our land and our indigenous people when you've done this here in the Amazon?"
Karen Hinton, spokesperson for the Ecuadorians who sued Chevron, said Craig sported an “uncomfortable smirk,” when he told Monro that the pollution posed no risk to human health and that indigenous communities were extorting the company.
Monro also visited sites that Chevron claimed it had remediated. Chevron used its purported "remediation" as a defense during the Ecuador trial, but the company only spent $40 million covering up a small number of pits with dirt and then lied about the results, according to evidence before the court.
In contrast, BP's liability for the Deepwater Horizon spill in the Gulf of Mexico – one with far less impact than the damage created by Chevron in Ecuador – has been estimated by analysts at $60 billion, or 1,500 times higher than the amount Chevron spent cleaning up the damage it caused in Ecuador.
"You look at the [remediated] pit and think it's fine, but dig a little deeper and you realize that they are nothing but big lakes of crude oil up to three meters deep," Monro said, illustrating his point by putting a large branch into the oil.
Chevron also has a major investment in a separate $25 billion natural gas project in Australia which is still being developed. On that project, called Gorgon, Chevron has been sharply criticized for refusing to seek proper environmental review.
The American show 60 Minutes also exposed Chevron's Ecuador problem in a segment that ran in May 2009. On that show, Chevron lawyer Silvia Garrigo subjected herself to widespread derision by asserting that the oil contamination in Ecuador was no more harmful to indigenous groups than the oil in the makeup on her face.