New York Times Bolsters Ecuador's $27-Billion Shake Down of Chevron

First it was CBS’s “60 Minutes” laying the groundwork to push a campaign against Chevron for an ill-advised lawsuit. Now The New York Times has picked up where they left off.


An article in the May 15 Times attacked Chevron for what a plaintiff’s lawsuit alleges is pollution caused by Texaco, now a part of Chevron (NYSE:CVX). The article by Simon Romero and Clifford Krauss, pointed out how the people of Ecuador resent Chevron for pollution the country’s current government claims was left behind by Texaco.


“Texaco’s roughnecks are long gone, but black gunk from the pits seeps to the topsoil here and in dozens of other spots in Ecuador’s northeastern jungle,” Romero and Krauss wrote. “These days the only Chevron employees who visit the former oil fields, in a region where resentment against the company runs high, do so escorted by bodyguards toting guns.”


But the assertion that some on the environmental left would have people believe – that Texaco had pillaged the jungles of Ecuador for oil then picked up and left after making their profits is not correct, even by the Times own accounts.


“So Texaco reached a $40 million agreement with Ecuador to clean a portion of the well sites and waste pits in its concession area, absolving it of future liability,” Romero and Krauss wrote. “But that cleanup, carried out in the 1990s, was far from the bookend Texaco hoped to achieve.”


But that’s not the way Ecuadoran villagers see it, according to the report.


“Instead, villagers in Ecuador became convinced they were getting sick from the pollution left behind,” Romero and Krauss wrote. “They filed suit in 1993 in the United States, and later claimed that their grievances were not covered by Texaco’s settlement agreement.


What the Times story didn’t report is how poor the water infrastructure is in Ecuador – which may be a part of what behind some of the illness in that part of Ecuador. However, they did go with the claim that the pollution Texaco has allegedly created, versus pollution that the sites’ current operator of 16 years PetroEcuador may have created, has caused an increase in cancer claims.


“Citing scientific studies, the plaintiffs claim that toxic chemicals from Texaco’s waste pits, including benzene, which is known to induce leukemia, have leached for decades into soil, groundwater and streams,” Romero and Krauss wrote. “A report last year by Richard Cabrera, a geologist and court-appointed expert, estimated that 1,400 people in this jungle region – perhaps more – had died of cancer because of oil contamination. Chevron rejected the claims, contending that Mr. Cabrera had no medical evidence to back up his conclusion that the company should pay $2.9 billion just to compensate for excess cancer deaths.”


However, as Michel Kelsh, a health researcher and professor at UCLA’s School of Public Health and Chevron consultant discovered, there’s no evidence of this has created a spike in cancer.


“We looked at cancer mortality rates in the Amazon region in general, and we compared those rates to Quito, and we found that the Amazon region has much lower cancer rates,” Kelsh explained on behalf of Chevron. “We also compared the regions where there were oil activities in the Amazon to regions where there were no oil activities and really found no differences. We actually found slightly lower rates of cancer in these regions.”


Cancer awards had been sought from Chevron before and have been knocked down by a federal judge in the United States.

In September 2007, a U.S. district court San Francisco dismissed nine cancer allegations against Chevron and the judge termed the claims “baseless.” Their “inquiry,” he said, “was so minimal, as to be unreasonable and incompetent.”  The lead attorney, Cristobal Bonifaz, a former partner of Donzinger was sanctioned and ordered to pay Chevron $45,000.


The Times also left out that Cabrera was paid $200,000 for his report by members of the Amazon Defense Coalition, an environmental activist organization, which also staffed Cabrera’s field team.