SAN FRANCISCO (AP) — A fire at one of the country’s largest refineries spewed thick black smoke over cities in the San Francisco Bay area, sending scores of residents to hospitals complaining of breathing problems early Tuesday.
Doctors Medical Center in San Pablo, a town near the Chevron refinery in Richmond, said about 200 people had sought help and more patients were arriving. Kaiser’s Richmond Medical Center also said several dozen people came to the emergency room complaining of shortness of breath, but none was seriously ill.
Residents said they heard loud blasts around 6:15 p.m., when the fire broke out, although Chevron officials could not confirm those reports.
Daniela Rodriguez told the Contra Costa Times that she heard a “big boom” about the time the fire started. The 23-year-old resident said about an hour passed before she received an automated call from Contra Costa County to remain indoors.
“I was feeling kind of nauseous and light-headed (from the smell),” she told the newspaper.
The Chevron Richmond Refinery makes high-quality products that include gasoline, jet fuel, diesel fuel and lubricants, as well as chemicals used to manufacture many other useful products. The blaze started Monday evening when a diesel leak ignited at the refinery’s No. 4 Crude Unit, Nigel Hearne, manager of the refinery, told The San Francisco Chronicle.
Randy Sawyer, the chief environmental and hazardous materials officer for the county’s health services agency, said any kind of smoke can be toxic, but added: “In this smoke, there can also be all kind of byproducts that can be toxic.”
The agency had four teams of inspectors testing air quality, Sawyer said.
The blaze at the plant in Richmond, about 10 miles northeast of San Francisco, was contained by late Monday although it was not immediately known when the flames would be extinguished, said company spokeswoman Heather Kulp.
One employee suffered a minor injury and was receiving first aid, Chevron officials said.
County health officials used automated calls to warn residents of Richmond, San Pablo and the unincorporated community of North Richmond to “shelter in place,” meaning they should not only stay inside, but should also turn off heaters, air conditioners and fans, and to cover cracks around doors with tape or damp towels.
To the south, Oakland police issued a community advisory suggesting that residents of the North Oakland Hills area close all windows and doors and turn off air conditioners.
A fire at the refinery in January 2007 injured two workers and spewed low levels of sulfur dioxide and other toxins into the air. County officials said then that it was not enough to harm the health of nearby residents.
During an evening news conference, Hearne apologized “to the community for the fire and smoke this evening at the Richmond refinery.”
The refinery is the largest producer of base oils on the West Coast, processing up to 240,000 barrels of crude oil a day, according to the company’s website.
The company said Monday it did not know yet whether production would be affected. The 2007 fire shut down the refinery for most of that year’s first quarter.
4.2 Public Safety and Hazardous Materials August 2011 4.2-3 Conoco Phillips Santa Maria Refinery Throughput Increase DEIR
Oils are typically mixtures of many different compounds, most of which are hydrocarbons. There are a series of main hydrocarbon groups in petroleum. Saturates are hydrocarbons with straightchains of carbon atoms, while aromatics are hydrocarbons consisting of rings of carbon.Asphaltenes are complex polycyclic hydrocarbons that contain many complicated carbon ringsand nitrogen-, sulfur-, and oxygen-containing compounds.Sulfur in crude oil occurs in many natural compounds including hydrogen sulfide (H
S), a toxic gas that can cause injuries or fatalities if released to the atmosphere and subsequently inhaled.Total sulfur ranges from approximately one to four percent by weight in crude oils, while H
S concentrations can reach 100 parts per million (ppm) in “sour” crudes. Fortunately, its strong,pungent odor is detectable at a level substantially below that which causes adverse health effects.However, H
S also causes paralysis of the olfactory functions at levels below health effects.Other constituents of crude oil include nitrogen and oxygen compounds, as well as water- and metal-containing compounds, such as iron, vanadium, and nickel.The processed gas at the Refinery is used in processes at the Refinery. The majority of the gas is methane with some smaller amounts of ethane and butane and inert compounds (such as CO
).Produced gas presents hazards due to its flammability in the form of vapor cloud fires and explosions, and thermal radiation impacts due to flame jet fires emanating from a gas leak or rupture
CEO JOHN WATSON
opens Chevron’s 2010 Annual Repor by telling the corporation’s stockholders that “2010 was a noutstanding year or Chevron.”
We do not agree. We, the communities who bear the costs of Chevron’s op-erations, have witnessed a year in which Chevron’s perormancewas anything but exceptional. As we have documented in this third installment of the
An Alternative Annual Report
, Chevron continues its long history o ravaging natural environments, violating human rights, ignoring the longstanding decisions of Indigenous communities, destroying traditional livelihoods, and converting its dollars into unjust political influence in the United States and around the world.This report is a record of egregious corporate behavior that—in locations as diverse as California, Burma, Colombia,Ecuador, Kazakhstan, Nigeria, the Philippines and the U.S.Gulf Coast—has spanned decades and carries on today.In the year that saw the world’s largest unintentional oil spill, intensifying global concerns about the safety of the hydro-carbon industry, Chevron has failed to change its behavior.In 2010, Chevron pursued ever-riskier and ever-deeper off-shore projects in the South China Sea, the North Sea, the U.S.Gulf Coast, and the Canadian Arctic.
Chevron Corp. (CVX) said it contained a fire that broke out in the crude unit at its Richmond refinery, the largest in Northern California.
The company was bringing down units after a blaze at the No. 4 crude unit started yesterday around 6:15 p.m. local time, according to a person with direct knowledge of the operation who asked not to be identified because the information isn’t public.
Enlarge image Chevron Said to Be Shutting California Refinery on Fire
Built on a peninsula of low hills rising from San Francisco Bay, the refinery became the West Coast’s largest and most advanced plant upon its completion in July 1902, according to the website. Photographer: David Paul Morris/Bloomberg
Flames were brought under control as of 10:30 p.m. local time, and all employees at the refinery have been accounted for, said Melissa Ritchie, a Chevron spokeswoman at the plant. One person was being treated for minor burns on the wrist, she said. The plant reported an evacuation after the fire broke out, a filing with the California Emergency Management Agency shows.
Crews determined there was a diesel leak from a line in the crude unit that may have started the fire, Ritchie said. She declined to confirm the definite cause of the incident.
The Contra Costa County health-services department issued a shelter-in-place advisory for Richmond, North Richmond and San Pablo because of the fire. The agency recommended that residents stay inside their homes or the nearest buildings, bring pets indoors, close doors and windows, and make sure vents and fireplaces are closed.
The Richmond plant can process 240,000 barrels a day of feedstock, data compiled by Bloomberg show. The plant is about 110 years old, according to the company’s website. Built on a peninsula of low hills rising from San Francisco Bay, the refinery became the West Coast’s largest and most-advanced plant upon its completion in July 1902, according to the website.
The county’s hazardous materials division was at the refinery to test air quality, according to a notice from the health department. The plant released sulfur dioxide, nitrogen oxide, hydrogen oxide, sulfuric acid and nitrogen dioxide because of the fire, the state filing shows.
BART, the regional transit system, halted service between the Richmond station and El Cerrito Plaza, a notice on the agency’s website shows.
The refinery produces gasoline, jet fuel, diesel, lubricants and other oil products, according to the company’s website. The plant is one of six refineries that make up more than 75 percent of Chevron’s total refining capacity, the website shows.
Nov. 14 Incident
The refinery shut a crude unit on Nov. 14 after vacuum residuum, made up of heavy hydrocarbons, leaked from a bleeder on a filter and “auto ignited,” Chevron said in a filing to county regulators following that fire. The unit was returned to service later that same month, two people with direct knowledge of the plant’s operations said Nov. 29.
Chevron’s oil refineries and filling stations earned $1.88 billion as U.S. processing margins climbed to a second-quarter record average of $28.98 a barrel when crude costs fell faster than gasoline prices.
Chevron’s net income fell to $7.21 billion, or $3.66 a share, from $7.73 billion, or $3.85, a year earlier, the San Ramon, California-based company said in a statement July 27. The result was 35 cents more than the average of four analysts’ estimates compiled by Bloomberg, which ranged from $3.10 to $3.47.
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A huge Refinery near Oakland California capable of producing 240,000 barrels a day burns early Monday Morning…Residents have been urged to stay inside, and the area is being evacuated.A Level 3 Hazmat emergency has been declared…developing…Starting at the Chevron refinery shortly before 5:30 a.m. a shelter-in-place order has been issued, authorities said.
The countywide warning system was activated, a dispatcher with the county’s hazardous materials department said.
The fire may cause eye, skin, nose or respiratory irritation in the community. To shelter in place, West County residents should pick a windowless interior room, turn off fans and heating and air-conditioning systems and keep a radio, television or computer on for updates.
Toll operators from the Richmond-San Rafael Bridge have been cleared from booths, the Highway Patrol said. Toll gates will be left open; drivers in the area are advised to use caution, including turning off ventilation and close windows as they pass through.
No immediate word was available on injuries.
Commuters who use the Richmond-San Rafael Bridge got an unexpected benefit from the fire. Toll takers were told to shelter in place and stopped taking tolls for part of the morning commute.
In April 2010 Chevron released its 2009 Annual Report. It would not take long for the cover design – Chevron’s Gulf of Mexico ultra-deepwater drillship, the Discoverer Clear Leader – to seem a terribly poor choice.
Just days prior to publication, 18,000 gallons of crude oil spilled from a Chevron operated pipeline in the Delta National Wildlife Refuge in southeastern Louisiana.
A far worse disaster struck less than two weeks later. The largest blowout of an oil and gas well in the Gulf of Mexico in 30 years killed eleven people and saturated the surrounding areas in a blanket of oily destruction. The rig was owned and operated by Transocean, the same company with which Chevron has a five-year contract to operate the Discoverer Clear Leader, among other Chevron offshore rigs.
While the cover image of Chevron’s Annual Report shows a pristine rig, perhaps the more appropriate photo for Chevron will prove to be the image on page two: the sun setting on Chevron’s Way.
Chevron’s 2009 Annual Report celebrates 130 years of Chevron operations. In it, the company declares that the “values of The Chevron Way” include operating “with the highest standards of integrity and respect for human rights,” a deep commitment “to safe and efficient operations and to conducting our business in an environmentally sound manner,” and the building of “strong partnerships to produce energy and support communities.”
We, the communities and our allies who bear the consequences of Chevron’s offshore drilling rigs, oil and natural gas production, coal fields, refineries, depots, pipelines, exploration, chemical plants, political control, consumer abuse, false promises, and much more, have a very different account to offer. Thus, we have once again prepared an Alternative Annual Report for Chevron.
Written by dozens of community leaders from sixteen countries and ten states across the United States where Chevron operates, the 60-page report encompasses the full range of Chevron’s activities, from coal to chemicals, offshore to onshore production, pipelines to refineries, natural gas to toxic waste, and lobbying and campaign contributions to greenwashing. CorpWatch is proud to be a contributor to this important collaborative report.
On May 25, forty report authors will appear in Houston at a press conference to address the true cost of Chevron’s operations in their communities. On May 26, they will deliver the report directly to Chevron inside the company’s Annual General Meeting (AGM) while supporters rally outside.Source
What happens when you mix a cocktail of scandal, professional ambition, raw emotion, bungled public relations, and the dual scents of oil and money? In Brazil, you get 17 oil executives and rig hands from American companies under threat of decades of imprisonment.
In Rio de Janeiro, a federal prosecutor yesterday indicted the men — from Chevron and the oil services company Transocean — for their involvement in a small November oil spill off the Brazilian coast. This is showmanship — Chevron will probably have to pay a large fine, but these men are unlikely actually to sit in prison. Similarly, notwithstanding suggestions to the contrary by Chevron CEO John Watson, the company will take its lumps and continue working in Brazil, if it is permitted to, and most probably anywhere else it can obtain access to billion-barrel oilfields.
Yet the set of events highlights both a new world in which “any small spill is a big spill,” as an oilman told me yesterday, and why the flurry of announcements of fresh discoveries around the world are only the beginning. After the find comes local politics, whether it is Russia, Mozambique or the United States.
In the case of Brazil, Chevron has been producing oil from a field called Frade since 2009. The spill occurred in November, and was largely repaired after four days with the reported spillage of about 2,400 barrels of oil (Chevron released this statement, which includes video of the well).
Two factors set the atmosphere for what happened next. The first was BP’s 2010 spill of 5 million barrels of oil into the Gulf of Mexico, which alerted observers around the world not to trust oil company assurances of complete and utter control of deepwater drilling and its risks.
The second was Chevron’s initial public relations response to the Frade spill. Rather than learning from BP’s misery, Chevron elected to revert to the industry’s old ways. First it defensively said its drilling was not responsible for the spill before conceding that it was. Then it underestimated the extent of the spill, creating more local distrust. Source
An original version of this post stated that SkyTruth’s image was taken Nov. 25, of the oil slick on the ocean floor. It was actually taken Nov. 12, of the oil slick on the ocean surface. This version has been corrected.
An oil leak at a Chevron Corp. deep-water well off the coast of Rio de Janeiro this month is not going away. Not for Chevron, which has been met with outrage locally for its mistake, and not for the ocean, which still has an oil slick after two weeks, a byproduct of the 2,400 to 3,000 barrels of crude oil spilled into the sea.
An aerial view of vessels in the clean up of an oil spill in an offshore field operated by Chevron at the Bacia de Campos, in Rio de Janeiro state, Brazil. (Rogerio Santana – AP) Brazilian authorities say the corporation failed to initially provide accurate information to authorities about the extent of the spill. They “tried to make the accident less than it was,” says Magda Chambriard, director of Brazil’s National Petroleum Agency.
Regulators are also skeptical of Chevron’s current estimates on how much oil is still leaking from the ocean floor — “infrequent droplets,” according to a company spokesperson. Chambriard scoffs at that. “We are still far from the good end” of resolving the problem, she says. At its height, the leak released 200 to 330 barrels per day.
“The oil slick may be smaller, but it’s still there,” confirms John Amos of SkyTruth, a group that promotes environmental awareness and protection with remote sensing and digital mapping technology. “And I expect we will see it there for a long time.”
SkyTruth has this image of the oil slick at the ocean surface from satellite imagery taken Nov. 12, before Chevron started plugging the well:
Regulators suspended all of Chevron’s operations in the country this week and plan to fine the oil giant more than $80 million. Rio de Janeiro’s environment minister, Carlos Minc, has said Chevron might be banned from Brazil altogether.Source
Mar 1964 — March 5, Exploration concession signed; Consortium formed (50% Texas Petroleum 50% Gulf Ecuatoriana)
1972 — Trans-Ecuadorian pipeline completed
Aug 1973 — Presidential Executive Decree gives government full regulatory and supervisory authority over Consortium operations
Jun 1974 — Petroecuador acquires 25% share of the Consortium
Dec 1976 — December 31, Petroecuador acquires Gulf’s remaining share, increasing ownership of the Consortium to 62.5% majority interest
Mar 1986 — March 1, Petroecuador acquires 100% ownership of Trans-Ecuadorian pipeline
Oct 1989 — October 1, Petroecuador takes over operation of pipeline
Jun 1990 — June 30, Petroecuador takes over operation of all other Consortium facilities
Jun 1992 — June 7, Consortium contract expires; Petroecuador acquires 100% ownership of the Consortium
Aug 1993 — August 31, Ecuadorian Plaintiffs file Sequihua class action in Texas
Nov 1993 — November 3, Ecuadorian Plaintiffs file Aguinda class action in New York
Jan 1994 — January 27, Federal district court in Texas dismisses Sequihua; (no appeal filed)
Dec 1994 — December 28, Peruvian Plaintiffs, represented by Aguinda counsel, file Jota class action in New York
May 1995 — May 4, Texaco and the Republic of Ecuador sign a comprehensive Settlement Agreement. TexPet finances remediation, social projects, and medical centers
Jun 1996 — Texaco Petroleum signs Settlement Agreements with four municipalities where Consortium operated
Nov 1996 — November 13, Federal district court in New York dismisses Aguinda unconditionally
Aug 1997 — August 12, Federal district court in New York dismisses Jota unconditionally
Sep 1998 — TexPet receives final approval from Republic of Ecuador, certifying completion of work under Settlement Agreement
Oct 1998 — October 5, Second Circuit remands Aguinda and Jota to District Court for re-consideration, requiring Texaco consent to jurisdiction in Ecuador
Nov 1998 — November 11, Ecuador’s Ambassador to U.S. submits letter to Judge Rakoff refusing to waive sovereign immunity in Aguinda and Jota
Nov 1998 — November 17, At post-remand hearing in the district court, Texaco orally consents to jurisdiction in Ecuador and Peru as to Aguinda and Jota plaintiffs
Jan 1999 — January 11, Texaco files its renewed motions to dismiss in Aguinda and Jota with written consents to jurisdiction in Ecuador and Peru
May 2001 — May 30, Federal District Court in New York (Judge Rakoff) dismisses Aguinda and Jota for the reasons and on the terms suggested by Texaco
Jun 2001 — June 29, Plaintiffs file Notices of Appeal in Aguinda and Jota
Oct 2001 — October 9, Chevron and Texaco complete merger to form ChevronTexaco
Nov 2001 — Aguinda and Jota file appellate briefs in the Second Circuit of the U.S. Court of Appeals.
Aug 2002 — August 16, Second Circuit of the U.S. Court of Appeals upholds U.S. District Court decision to dismiss Aguinda and Jota
May 2003 — May 7, Plaintiffs file lawsuit before Superior Court of Nueva Loja in Lago Agrio, Ecuador
Aug 2003 — A second lawsuit filed in the Superior Court of Tena in Tena, Ecuador
Sep 2003 — The Superior Court of Tena rejects the complaint based on failure to meet procedural requirements under Ecuadorian law
2003 — Phase one of the trial begins with agreement by the Court, plaintiffs’ lawyers and Chevron to conduct 122 judicial site inspections at oil field sites
March 2004 — Recognized environmental experts commissioned by Chevron conduct inspections of the sites remediated by TexPet and find no evidence of hydrocarbon contamination. During their inspections, experts observed visible evidence of contamination at locations outside TexPet’s area of responsibility, or that were associated Petroecuador’s operations.
Dec. 2004 — Chevron registers strong protest with the Court – Plaintiffs’ violate court rules on sampling and testing process; Fail to follow most basic scientific procedures; disturbing pattern in plaintiffs’ conduct seen as attempt to mislead the public and distort test results
Jan. 2005 — Scientific tests confirm first four sites inspected by Judge are safe – Laboratory findings verify effectiveness of Texpet’s environmental remediation; TexPet met or exceeded all applicable international evaluation criteria
Feb. 2005 — Experts say health studies promoted by lawyers and activists are flawed, biased and inconclusive
Feb. 2005 — Safety of Remediated Sites Confirmed by six scientific reports; No threat to human health from oil-related contaminants
July 2005 — Scientific Analysis from the Judicial Site Inspections Prove No Risks to Health or the Environment Exist; Drinking Water Highly Contaminated from Human and Animal Waste, Not Petroleum Activities
Oct. 2005 — Plaintiffs’ expert reports show pattern of flaws and distortions; Reports lack credible scientific support to validate claims
Feb. 2006 — Plaintiffs lawyers prevent Judge from inspecting laboratory used to analyze their samples; Chevron suspects problems with laboratory technical capability, competency and credentials
Feb. 2006 — Court’s “Expert Report” on Sacha 53 confirms TexPet’s remediation effective and in compliance with legal standards; No significant risk to human health from remediated site
March 2006 — Dr. Michael Kelsh, a renowned expert on environmental health, informed the Court that health studies promoted by plaintiffs “do not provide evidence that diseases were caused by petroleum.”
March 2006 — Superior Court Judge denied for a second time access to laboratory used by plaintiffs; plaintiffs and laboratory in defiance of Court order
March 2006 — Superior Court Judge denied for a third time access to laboratory used by plaintiffs; plaintiffs and laboratory in defiance of Court order
April 2006 — Official court document proves plaintiffs’ attempt to obstruct justice by misrepresenting information to the Court; Plaintiff’s own technical expert submits declaration to protect himself from plaintiffs’ unethical actions
April 2006 — Expert on indigenous cultures presents Court with demographic studies disproving Plaintiffs’ claims about indigenous populations in the Ecuadorian Amazon
Aug. 2006 — Evidence from two years of judicial site inspections shows no significant health risk from oil in areas remediated by TexPet
Oct. 2006 — For sixth time, Judge is prevented from conducting Judicial Inspection on laboratory used by plaintiffs
Nov. 2006 — World renowned experts find Chevron’s sampling and analysis plan effective, comprehensive and scientifically sound for evaluating oilfield sites; Experts find plaintiffs’ allegations baseless and seriously flawed
April 2007 — Laboratory used by Plaintiffs experts blocked for judicial inspection for 7th time; Clear attempt to obstruct justice
April 2007 — Government of Ecuador officials’ visit oil field sites with plaintiffs’ lawyers and improperly interfere in the judicial process
June 2007 — Chevron challenges Court for appointment of Richard Cabrera as the sole expert in the evidentiary phase for determination of the environmental effects of activities related to the production of hydrocarbons in all the fields operated by Texpet; sites violation of the Court’s 2003 order
July 2007 — Epidemiology experts find serious errors in plaintiffs’ cancer studies; Actual cancer rates lower than claimed by Plaintiffs; Findings published in International Medical Journal
July 2007 — Chevron names highly respected independent observer to help ensure integrity of judicial examination; Action necessary given multiple irregularities systematically committed by expert Cabrera
Aug 7 2007 — Federal Court in San Franciso Dismisses Ecuadorian Cancer Claims Against Chevron As Knowingly False
Aug 20 2007 — Chevron Calls for Recusal of Judge in Ecuador Suit
Sep 3, 2007 — Superior Court Again Blocked in 8th Attempt to Inspect Laboratory used by Plaintiffs’ Experts in Environmental Trial Against Chevron
Sep 19, 2007 — Ecuador Plaintiffs’ Have Provided No Evidence to Support Their Cancer Claims
Sep 13 2007 — Use of Secret, Unapproved Research Teams Further Demonstrates Bias and Lack of Transparency in Ecuador Suit
A recent decision by an international arbitration tribunal, administered by the Permanent Court of Arbitration in The Hague, is a setback for Ecuador and for environmentalists that wish to use the international legal system to protect the environment. Ecuador and Chevron, the second largest U.S. oil company, have been engaged in a long-standing dispute about environmental impacts from oil extraction. Experts describe this recent decision as a collateral attack on the original underlying issue. Ecuadorian courts are expected to rule soon on the massive $27 billion dollar suit filed by Ecuador against Chevron, and this most recent decision may be an attempt send a signal to the justices, or prevent enforcement of the judgment.
This most recent case was a suit filed in 2009 by Chevron against Ecuador for violations of its due process rights. It arises out of a complaint factually unrelated to the original $27 billion dollar, but its political and legal ramifications will likely spill over. In the recent arbitration action, Chevron claimed that between 1991 and 1993, Ecuador sold oil intended for domestic consumption on the international market. Chevron alleged that the domestic Ecuadorian courts were delaying ruling on this issue, violating its rights under the Bilateral Investment Treaty (BIT) between the United States and Ecuador. The arbitration panel found that Ecuador court system did not provide an adequate way to file claims and enforce rights, and it awarded Chevron $700 million.
Ecuador has not accepted this unfavorable turn of events without a fight. It is now exploring options for appeal under its own domestic laws as well international law. President Rafael Correa issued a strong statement condemning Chevron’s actions, “This new effort to compromise the Ecuadorean state in its firm commitment to respect the independence of its judicial system . . .will not succeed.” Investors reacted favorably as a result of this ruling; Chevron stock rose half a percent and recent financial reports paint a rosy picture, with predictions of future profits higher than in the previous financial quarter.
Observers have noted the importance of this arbitration decision, but also point out that it pales in comparison to the original environmental dispute. Ecuadorian citizens living in the Amazon rainforest filed a suit in the United States in 1993 for ill health effects caused by pollution associated with Chevron’s oil drilling in their lands. The original suit involved 76 residents of the Oriente region of Ecuador, who filed on behalf of thousands more. They claimed that the decades of oil exploration and extraction had created “vast devastation”. These cases were dismissed by the American courts and refilled in Ecuador. During the course of the trial in Ecuador, both sides have exchanged claims of wrongdoing and corruption. Some experts believe that Ecuadorian courts will soon rule against Chevron and the company vows to fight any adverse decision.
Chevron’s allegations that the Ecuadorian courts are inadequate strike some observers as curious, because Chevron was originally in favor of moving the trial to Ecuador. The suit was originally filed in New York, but Chevron requested that it be moved to Ecuador. The District court that said, “the well-known congestion of American dockets is undoubtedly greater than that of less litigious societies. Indeed, in terms of engendering inordinate delays, the history of mass tort class litigation in the United States is not such as to inspire confidence.” Because the suit was attempting to enforce the laws of Ecuador, the court understandably believed that those courts would to be superior and described its own efforts as “preposterous.”
The end game for Chevron may not be winning the lawsuit in Ecuador, but avoiding paying damages if it does lose. In winning this most recent BIT arbitration on illegal oil sales, it may be able to prove in U.S. courts that it does not need to pay future claims. Long ago, U.S. courts decided in Hildton v. Guyot that judgments in foreign courts would not be enforceable if there was “prejudice in the court, or in the system of laws under which it was sitting, or fraud in procuring the judgment.” With the precedence set by the arbitration decision, Ecuador is now in a tough position to prove that its courts meet the highest standards. Pepperdine University School professor Roger Alford described the current situation, “The Ecuadorian court now faces the unpleasant prospect of knowing that the Ecuadorian government may be on the hook financially for any improper judgment rendered against Chevron.”
Countries throughout the world could benefit from an Ecuadorian victory by launching their own legal actions modeled after this one. However, this recent victory by Chevron seems to cast the viability of this option in doubt.Source
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