Amazonian Chernobyl - Ecuador's oil environment disaster

Clare Kendall, The Telegraph 8 Aug 08;

Once it was pristine rainforest. Now it has been described as an Amazonian Chernobyl.

Millions of gallons of crude oil and toxic waste - the legacy of an oil extraction programme - has blighted 1,700 hectares of land and poisoned the rivers and streams in Sucumbios in the north-east corner of Ecuador.

The region is home to five different indigenous tribes and its rich biodiversity includes many thousands of plant and animal species.

Oil has been one of the South American country's most profitable exports since the 1960s but it has come at a terrible environmental price.

Amazon Watch, the Environmental action group, claim that in excess of 17m tonnes of oil waste has been dumped in open and unlined pits which has poisoned the land and the water course.

Locals claim that many oil pits in the 1990s were simply covered in plastic, rubble and soil and are still leaking toxic chemicals into local water supplies.

Indigenous Indian people blame the pollution on the US oil giant Chevron - formerly Texaco - and say it has caused a catalogue of health problems including severe birth defects, spontaneous miscarriages and cancers.

Their plight has attracted a galaxy of environmentalists and campaigners including film star Daryl Hannah, Sting and Trudie Styler and British 'Eco-aristocrat' Zoe Tryon, daughter of the Prince of Wales' late friend, Lady Tryon.

For more than a decade the ruined landscape has been the subject of a bitter lawsuit brought by 30,000 Ecuadorians against Chevron who operated an oil concession between 1972-1992.

It is a David and Goliath battle with the Ecuadorians being represented by local hero and environmentalist Pablo Fajardo, who started life as a labourer on plantations, supporting his poor family, while at the same time putting himself through law school.

His courage in taking on such a powerful opponent has won him a Goldman Prize - the environmental equivalent of an Oscar.

Chevron, who operated as a minority partner with Ecuador's own state-owned extraction company, Petroecuador, claims its responsibilities ended in 1992 when it handed over its operations in Sucumbios to the state and implemented a $40 million remediation programme. The responsibility, they claim, now lies with Petroecuador.

In April, a court appointed expert handed in a long awaited report following detailed inspections of the affected areas and recommended that, should Chevron lose the case, it should pay up to $16bn in damages. The figure would be a world record and set a global precedent.

The ruling was hailed by local campaigners as a milestone and by Chevron as a charade. They claim court procedures weren't followed and that the Ecuadorian geologist who compiled the report, Richard Cabrera, had been aided by parties connected to the local people.

But the ruling acted as a wake-up call for Chevron. According to a recent report in Newsweek it forced the California-based oil company to disclose the issue to its shareholders.

And it has prompted, according to the magazine, a high-powered battle in Washington between an army of Chevron lobbyists and the lawyers working on behalf of the Ecuadorians.

Chevron is urging the Bush administration to take trade sanctions against Ecuador unless the legal action is dropped.

The company claims it has been victimised by a "corrupt" Ecuadoran court system while its opponents received support from Ecuador's leftist president, Rafael Correa - an ally of Venezuela's Hugo Chávez. Chevron says a loss could set a dangerous precedent for other US multinationals.

But the dispute has taken a new twist. Steve Donziger, a US trial lawyer working on behalf of the Ecuadorians, has recruited an old basketball friend from Harvard, Barack Obama, who at the time hadn't even announced his presidential intentions.

Obama was apparently so impressed by photographic evidence of the oil pits he wrote to the US trade representative, Rob Portman, urging him to let the case rest in the hands of the Ecuadorian judge.

He stands by his position which could be an important factor should he become President in November.