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Chevron vs. Ecuadorean activists

Barring delays, an epic legal battle is expected to be decided this year.

Texaco first began drilling in the Ecuadorean Amazon in 1964 and struck oil in 1967. Full-scale production began in 1972 in a consortium with the Ecuadorean state oil company, which later became known as Petroecuador.

Though Texaco was the minority partner, the U.S. company was the operator, and was therefore responsible for all key decisions, according to the plaintiffs.

Over the years, Texaco produced about 1.7 billion barrels of oil, though the bulk of the profits went to the Ecuadorean government. Today, Ecuador is one of Latin America’s largest oil exporters. Petroleum accounts for about half of the nation’s export earnings.

But when Texaco began operating, Ecuador, like most Latin American nations, had weak environmental regulations. Lawyers for the plaintiffs charge that Texaco took full advantage of the lax rules and saved billions by recklessly disposing of toxic oil waste.

Between 1967 and 1990, lawyers claim that Texaco spilled more than 26,000 barrels of oil, and released drilling muds and billions of gallons of toxic production waters directly into the soil and rivers of northeastern Ecuador, where the company operated 356 wells.

Much of the oil waste was dumped into about 900 unlined pits that often leached toxic chemicals — such as barium, benzene and toluene — into the forest and groundwater, according to a report by Richard Cabrera, a court-appointed expert.

Donziger said that Texaco’s disposal methods would have been illegal in the United States. As early as the 1920s, he said, “the entire oil industry was moving away from the waste disposal methods Texaco used in Ecuador.”

In his report, Cabrera wrote that he found higher-than-normal rates of cancer and miscarriages among the people living in and around the former Texaco concession. Chevron officials strongly dispute his claim, saying that independent analysts have determined that cancer rates are no higher in the Amazon region than in the rest of the country.

The case is attracting attention far beyond Ecuador. On April 28, Democratic Rep. Jim McGovern of Massachusetts held a congressional hearing in Washington to discuss the Chevron case. At one point, he recalled his visit to former Texaco oil sites in Ecuador late last year.

“What I found was shocking — a super-fund site about the size of Rhode Island in the Ecuadorean Amazon,” McGovern said.

“I visited one indigenous community that had been forced to move three times to try and escape the oil pollution and contamination that was killing the fish, driving away the game, destroying medicinal plants and sickening the community, including the children,” he said. “Despite moving, they still couldn’t escape the impact of the oil.”

Chevron officials, who are waging a fierce lobbying campaign to turn the tide in the legal case and win over public opinion, insist that the lawsuit should be thrown out on several grounds.

For starters, they claim that much of the environmental damage was caused by Petroecuador, the state-run oil company that took over Texaco’s operations in 1990. Texaco pulled out of the country two years later.