Caltex and the law of the jungle

2011-02-23 07:35

Caltex, your friendly neighbourhood petrol dealers, have a dirty little secret they’d rather you not hear too much about.

Last week, a judge in the small Ecuadorian jungle town of Lago Agrio fined the US oil giant Chevron more than $8bn for causing devastating environmental damage in a million acre oil concession of remote Amazon rainforest.

“So it’s not really Caltex, is it?” you might think, but Caltex is just the brand name of Chevron in South Africa. It’s the same company. “But it’s not really a secret either!” Well, judging by the scant exposure the story has received in the mainstream press, it might as well be. Unpleasant things that happen in some God-awful, swampy Latin American backwater simply don’t get a lot of media coverage. It’s actually not little either, but it sure as hell is dirty!

The relevant timeline looks approximately like this:

• 1964-1990: the US oil company Texaco is the sole operator in the oil field, extracting crude oil from some 327 wells.

• 1992: Texaco leaves Ecuador.

• 1993: The original lawsuit is filed against Texaco in New York.

• 2001: Chevron (aka Caltex) merges with Texaco, taking on the company’s liabilities in Ecuador.

• 2003: After Chevron succeeds in having the case transferred out of US courts, it is re-filed, as a class action suit on behalf of 30 000 residents, in Ecuador.

• 2011: After more than 17 years and numerous allegations of bribery, espionage, delays, dirty tricks, evidence-tampering and cover-ups, the Ecuadorian court hands Chevron one of the largest environmental fines on record.

Between 1972 and 1990, Chevron (then Texaco) deliberately dumped more than 18 billion gallons of toxic waste sludge, containing carcinogens and other toxins, into rivers, streams and unlined pits. Just to be clear: this was not a case of accidental leakage or negligence as in the recent Gulf of Mexico oil spill, but hazardous waste, intentionally pumped into the Amazon ecosystem.

Along the way Chevron also managed to spill millions of gallons of crude oil and left behind as many as 1000 open waste pits that continue to leak dangerous pollutants into the air, soil and groundwater. And all of that in an area where the locals are dependant on river water for cooking, fishing, drinking and cleaning.

The impact has been devastating, effectively destroying large tracts of rainforest, damaging crops and killing farm animals. The health of the local population has plummeted, with the risk of cancers, miscarriages and birth defects all on the increase. Indigenous communities and their traditional way of life have been decimated.

Chevron has called the court ruling a “product of fraud”, “illegitimate and unenforceable”. The company has never accepted responsibility for its dirty legacy in Ecuador and it is not about to do so now, promising the plaintiffs a “lifetime of litigation”. In their final argument before the court, they claimed that no negligence was established or damage proven by the plaintiffs. According to them neither the environment nor a single human being has been harmed.

Of course they would respond that way. What precedent would it set, after all, if a bunch of semi-civilised Third-Worlders could successfully sue a multinational corporation?

What the company, which in 2010 tripled its second quarter profits to $5.4bn compared to a year earlier, has done, is spend millions on lobbying and PR efforts to clean up its public image. Among other things, Chevron launched their “We Agree” ad campaign - you may have seen it on DSTV - portraying themselves as concerned, eco-conscious and socially responsible corporate citizens.

Don’t believe a word of it! Until they face the music and pay their fair share of what’s necessary to fix the problems they have caused in Ecuador, all of that remains transparently cosmetic. And for every tank-full of Caltex with Techron® - that’s the magic petrol additive that injects your car with an army of tiny little people who tirelessly scrub and clean your engine as you drive - you also get a glob of oily, ugly, smelly and deadly rainforest pollution.

- Andreas has a PhD in geochemistry and manages Lobby Books, the independent book shop at Idasa’s Cape Town Democracy Centre. Follow him on Twitter: @Andreas_Spath

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