Chevron says Petroecuador to blame for Amazon contamination

QUITO (MarketWatch) April 27, 2007
-- Chevron Corp. said late Thursday that environmental damage in the Amazon is the sole responsibility of state-owned oil company Petroecuador, and expressed concern over getting fair treatment in the Andean nation.

"In the last 15 years, Petroecuador hasn't fulfilled its environmental obligations...and its history of environmental neglect and poor quality operations is very well documented," Chevron said in a press statement released Thursday night.

The company's comments come after a visit by Ecuadorean President Rafael Correa to oil-producing zones in Orellana and Sucumbios provinces, including sites where Texaco Petroleum Co. operated for almost 30 years. Texaco operated under its own brand in Ecuador before exiting the country in 1992. It merged with Chevron in 2001.

During his visit, Correa said damage to the Amazon must not go unpunished and accused Chevron of contamination that he said was 30 times worse than the Exxon-Valdez oil spill in Alaska in 1989.

Correa called for "the whole world to observe the barbarism committed by Texaco...in a zone where there are more than a thousand pools of residual crude that are the fruit of savage capitalism and the damages for which Texaco allocated $40 million for clean-up, exactly the same amount that the president of the company earned as salary last year."

Chevron is facing a lawsuit in Ecuador for allegedly contaminating zones in the Amazon region of Lago Agrio. The company is accused of using out-of-date technology that led to environmental damage.

"We are absolutely convinced that we all have the right to an impartial ruling and to be judged under the law and following due process, in an environment where judges guarantee impartiality, justice and transparency," Texaco said in its statement.

The oil company added that it's concerned about "actions recently taken by the plaintiff's lawyers, who - apparently because the evidence does not support their case - have decided to resort to pressure on the court and the government in an effort to disturb due process and deny Chevron its access to an impartial ruling."

The complaint against Texaco started in 1993 with a lawsuit in New York courts, which ruled that the case should be tried in Ecuador. In May 2003, several indigenous groups filed a lawsuit against the company in Lago Agrio.

The company denies the allegations and says it has met all requirements for environmental clean-up that were agreed upon with Petroecuador, spending about $40 million. Chevron has also said that in 1998, Petroecuador released the U.S.-based company from any liabilities regarding clean-up efforts.