Thursday, August 9, 2012

From Ecuador to Richmond to Nigeria, Greedy Chevron Lacks Respect for Communities Where It Operates

Flouts Safety in Backyard, Imagine What It Does in Places Where Few Are Watching
Want to understand the backstory for Chevron's latest environmental disaster in Richmond, California?  
See this video about Chevron’s devastating human rights violations and fraudulent cover-up in Ecuador and read this article about how Chevron essentially forced 154 of its Nigerian workers to jump from a smoking oil rig minutes before it exploded into the ocean after the company refused to evacuate them.
It has been clear for some time that a deep cultural rot has taken hold in Chevron's management team. The company is riddled by an outdated corporate governance structure designed to maintain a weak-kneed Board of Directors incapable of policing managers who don’t care to address fundamental operational and safety problems. (See this press release and this article about Chevron’s being named a company with some of the worst business practices in the U.S.)
For Chevron, it's about pure greed and lies.  Its marketing mantra – we respect the communities where we operate – is an advertising industry joke. The mantra should say:  Chevron promises it will always act as if it is above the law in the communities where it operates.
When will the SEC stand up and hold Chevron to account for its lies to shareholders about the Ecuador case, as documented in this devastating report? In fact, a U.S. Congresswoman recently called on the SEC to probe Chevron's management.
Chevron CEO John Watson and General R. Hewitt Pate – a disciple of Karl Rove -- both of whom are hopelessly conflicted on these issues are being paid huge amounts of money to make sure Chevron continues to pad its pockets at the expense of the communities where it operates. See here.
On recent conference calls with analysts who provide information to shareholders, Watson has lied repeatedly about the $19 billion damage award in Ecuador.  He has called the case a fraud and the Ecuadorians "criminals"– basically blaming the victims, the usual tactic of Chevron’s top brass.
The disaster at Chevron’s refinery in Richmond – where 900 people were sent to the hospital because of toxic fumes --  is another case in point. As Richmond community leader Andres Soto said on Democracy Now, Chevron never hesitates to lie:
Realistically, what we have seen is nothing but spin out of the refinery. On the one hand they apologized to the community (that’s) how they always lead their statements off. But, realistically, they came out and they were blaming the same community and the environmentalists for them not being able to modernize and upgrade their operations there at the Richmond refinery when in fact, we know that this unit, the crude unit that actually caught on fire and blew up, it was never part of that upgrade program.
They could have ensured the safety of this thing in general. But it is that mendacity, the misrepresentation of the truth that Chevron is engaging in that makes it very difficult to deal with them. They refuse to negotiate in good faith with the committee over a wide range of issues, whether it is fair taxation or whether it’s environmental safety and environmental justice.”
Children in Richmond living in poverty and in the shadow of Chevron’s antiquated refinery already are hospitalized for asthma at almost twice the rate of children in the rest of Contra Costa County.
In Ecuador, the eight-year trial produced overwhelming scientific evidence that Chevron deliberately dumped more than 16 billions of gallons of toxic waste into Amazon waterways and abandoned more than 900 toxic waste pits that have pipes to funnel oil sludge into streams and rivers used by indigenous groups for their drinking water.  Thousands of died of cancer, or are at risk of dying. 
In most countries, those responsible would be prosecuted for homicide. But in Ecuador, Chevron stripped its assets from the country and simply refuses to pay the judgment – essentially challenging the Ecuadorians to chase it around the world to seize various assets. (The Ecuadorians have launched legal actions to seize Chevron assets in Canada and Brazil already.)
But that’s not all.  The rot in Chevron is so extreme that the same pattern of polluting local communities and then lying about it has appeared in numerous other places: See this report for details.
**In Brazil, Chevron faces a $22 billion liability and possible criminal penalties for an offshore spill and related cover-up last November in the Frade field, a $3.6 billion deep water oil project that is one of Chevron's biggest capital investments in the world. 
**In Angola, the impacts of oil activity in the Sea of Cabinda are so disastrous that most of the sand on the shores is polluted and black in color, and most of the beaches cannot be used. 
**In Salt Lake City, a rupture of a Chevron pipeline dumped over 33,000 gallons of oil into Red Butte Creek, exposing residents to oil fumes with horrific health impacts. A second rupture occurred just five months later, dumping an additional 21,000 gallons of oil.
**In Canada, Chevron is undertaking a major expansion of its tar sands projects.  Increasing evidence demonstrates that Chevron’s development is contaminating the environment with toxins and severely impacting the health, livelihood and cultural preservation of indigenous communities living downstream.
**In Kazakhstan, Chevron’s development of the giant Tengiz Field emitted such high levels of toxins that the country’s government fined the operation nearly $64 million. 
**In Indonesia, a Chevron pipeline explosion covered part of a village in hot crude oil, leaving two children suffering burn wounds and a community devastated. 
These debacles happen on the watch of CEO Watson and General Counsel Pate.  How rotten is Chevron?  Pate just received a 75% raise (to $7.8 million per year) for getting the company to act like a fugitive for justice from the Ecuador case.  Watson’s compensation last year was on the order of $25 million. See here.
Countries around the world should simply cease doing further business with Chevron until it respects the communities where it operates and begins to obey local laws and court judgments.  By any measure, the Richmond disaster is only the latest illustration of why this company has lost its social license to operate.
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