Tuesday, June 1, 2010

Chevron’s Watson To Feds: Stop Us Before We Hurt Somebody

From a recent Dow Jones article: Chevron Corp. (CVX) Chief Executive John Watson said that the oil and gas industry has asked the U.S. government to raise safety standards for offshore drilling in order to avoid another "tragedy" like the massive spill that is still threatening the U.S. Gulf of Mexico.

In other words: "Stop us before we hurt somebody."

Watson's remarks are an astonishing admission from an oil industry CEO. He's acknowledging that oil companies are incapable of ensuring safe operations and conceding they will maximize profits and compromise safety standards unless the government steps in.

But Watson knows exactly what he is talking about – the damage that he is talking about is exactly what Chevron caused in Ecuador, an environmental and humanitarian catastrophe of epic proportions. Left to its own devices, Chevron put profits ahead of the safety of indigenous groups and the pristine environment of the Amazonian rainforest from the moment it landed its first helicopter in 1964 until it exited the country in 1992. By using substandard exploration and safety measures, Chevron "saved" an estimated $8 billion during three decades of exploitive oil drilling and exploration. This "savings" has resulted in the devastation of thousands of lives, an outbreak of cancer, and the decimation of indigenous groups.

The New York Times reported recently on a BP memo that admitted the oil company elected to use a cheaper type of cement casing system around the "blowout preventer" that experts believe may have prevented the explosion and the resulting spill. Texaco made a similar decision in Ecuador in the 1970s when it decided to not spend the $4 million at each of its well sites necessary to implement proper safety measures, such as the lining of toxic waste pits. Instead, Texaco's preferred method in the impoverished rainforest could be described quite simply: "dig and dump."

Instead of re-injecting deep into the ground the oil and toxic waste water left over from drilling well sites, as was the industry standard in the United States since at least 1962, Texaco dug over 900 huge holes in the ground and dumped a deadly mix of oil, chemicals and minerals into the unlined oil pits. Recent testing during the trial at about 100 of these oil pits and well sites revealed illegal and unacceptable levels of contamination that continue to leech into the ground, polluting the soil and water that the indigenous tribes and other Ecuadorians living in the area depend on for their survival.

The deadly consequences stemming from putting profits ahead of safety is a lesson that Chevron learned all too well in Ecuador. BP is now learning the same hard lesson in the Gulf. The question is whether either company will be held accountable.