The Cost of Greed

Death and defects are the rule in the Ecuadorian Amazon, thanks to American oil-company carelessness

In the Ecuadorian Amazon, 11-year-old Gina Lucitante can only laugh when she braids her friend's hair. Her inability to speak is one of the many birth defects children have as a result of heavy-metal toxins flowing in the water after 30 years of oil exploitation in this once-virgin rainforest.

Now, an unprecedented court case in the Amazon jungle town of Lago Agrio is in its final stage with a potential ruling of $6 billion in environmental damages against Texaco's parent company, the Chevron Corporation, which has more than 9,000 service stations across the United States--26 in the Tucson area alone.

Chevron lawyers say there are no toxins, that it cannot be proven that they left them and that the villagers are just trying to extort money. Meanwhile, independent studies show high levels of toxins in the air, ground and water. Villagers have lost a way of life, and many are losing their lives to cancer.

Oil exploration in the Ecuadorian Amazon began in the 1920s, but with no discovery made in 40 years, an unstable and military-controlled Ecuadorian government sold oil rights to a consortium of Texaco and Gulf Oil companies in 1964. Three years later, the consortium hit big, starting an oil boom that would account for more than half of Ecuador's gross domestic product for the next three decades.

In the early '60s, the Amazon rain forest was sparsely inhabited by farmers and indigenous communities whose land rights had not been defined yet by the government. Their ancestral lands were sold wholesale to Texaco, and oil drilling began in the provinces of Orellana and Napo.

In the absence of laws and regulations to govern oil exploration in the new Ecuadorian industry, majority-partner Texaco utilized less-expensive, but out-of-date production practices.

The most notorious examples, gathered from testimonies at the Lago trial, were the dumping of 18.5 billion gallons of highly toxic water directly into waterways or into about 1,000 open-earth pits, overflowing into waterways and seeping into the groundwater.

"That method of production was outlawed in the United States in the 1930s," says Steve Donziger, an American legal adviser to the plaintiffs. "The fact is, they knew better, because in the United States, they weren't doing that at the time. So what made them think they could do it here?

"They really never respected the value of life in Ecuador the same as they did in their home country, and that's the fundamental moral outrage of what they did," says Donziger.

Although laws governing the specifics of oil exploration and production were not yet on the books in Ecuador, Texaco's contract required that they use modern technology and avoid contaminating the environment.

To avoid water and soil contamination, oil companies worldwide reinject toxic waters into deep underground wells. Instead of doing this, Texaco admits dumping toxic production water directly into the surrounding environment to save about $4.5 billion and reap a profit of some $30 billion in Ecuador between 1964 and 1990, according to estimates by the American Petroleum Institute and calculations by the plaintiffs.

Due in large part to the rapid growth of the petroleum industry in the Amazon, the population in the area expanded in the late '60s and '70s. As Texaco perforated more oil wells, drilling sites grew closer and closer to human populations, meaning virtually every water source in the area was highly contaminated--and the population never knew.

When he was a boy, Alfonso Ureña and his brother Hugo cooled off on hot days by swimming in the rivers near their home, not far from Texaco's Sacha South oil well. The boys thought nothing of the oil that floated in the water from spills and overflows.

"Sometimes, we played in the petroleum and swam in contact with it," said Ureña. He and others in the community were told the oil was harmless.

Today, Ureña is one of the coordinators for the affected in San Carlos parish, a town of some 3,000 where farmers walk down a crude-paved road left by Texaco. They wear thick pants and rubber boots and carry machetes. Their pants are stained green from the thick grass; their boots are muddied from the constant rains; their brows gather sweat below broad-rimmed hats.

Taking a reprieve from the heat, Hugo Ureña, 55, gives his wide pants a tug and sits on a log under the shade of a citrus tree. As he slaps at mosquitoes, he recounts a dozen names of neighbors who've died of cancer in the past few years. And he remembers when things began to change in San Carlos.

"We started to make demands of the company when our animals began to die," said Ureña. "They died, and we opened one animal up to see what it had in its liver and in its guts. There we found residue of petroleum.

"That's when we began to make demands, but we didn't have even a laboratory to do any exams on the animals; we just had to find out the criollo way, as they say."

Ureña and other farmers told Texaco the animals were dying from drinking the petroleum-contaminated water, but the company said it was other sicknesses. Farmers began to sell off their animals for fear of losing them to poisoning, but Ureña's family sold its herd for a different reason.

Ureña's father was one of the first to die of cancer, in 1977. His fight was short-lived in a community so far from hospitals and clinics. By the time Wilfredo Ureña was brought to Quito for a diagnosis, he was in the final stage of the disease.

"My father had 65 cows. These we sold, all 65 of the cows; my brother sold a car that he had so that we could try to get my father's medicine, and we were left without the car, without the herd, and my father died," says Ureña.

The Ureña family has lost four members to cancer.

On Nov. 2, the Day of the Dead, family members dress in collared shirts, suit pants and their best shoes to visit their relatives' gravesites. There, they scrub the tombstones, replace artificial flowers and relight candles when the tropical raindrops put them out. Family members read the Bible, hug those arriving from distant provinces and watch children play at the small community cemetery where nearly every gravestone is surrounded by a mourning family.

Milton Curipoma was at the crowded cemetery that day, with two brothers and two sisters, to grieve the loss of their mother to cancer eight months ago. Curipoma's father and grandparents also died of cancer.

"The majority here have died of cancer like our (parents)," said Curipoma, who hopes that if the plaintiffs win, that Chevron will clean the environment to prevent future illness, and provide medical care to those already sick. Yet, Curipoma laments, "You can't recover the human losses."

In 1992, Dr. Miguel San Sebastian, a Spanish doctor of epidemiology, came to San Carlos to study the high incidence of cancer, especially children born with leukemia. He spent 10 years in the Amazon region, where many villagers remember him fondly. The tests he conducted showed the presence of cancer-causing agents in the soil, air and drinking water left by petroleum exploration. His studies also showed an association between high incidences of certain types of cancer in petroleum-producing areas of the Amazon.

San Sebastian returned in 2003 to testify in the case the affected brought against Chevron.

"People have been exposed to oil pollutants for over 20 years," said San Sebastian in a telephone interview from Sweden. "The main recommendation is to eliminate this source of pollution so people are no longer exposed to the contaminants."

Rosa Ureña, San Carlos' community nurse, said San Sebastian described the parish as a "time bomb." "'You have to leave,' he said," remembers Ureña.

San Sebastian also explains that even with a remediation, years of villagers' exposure to contaminants means future cancer cases are likely. In an effort to weaken the plaintiffs' case, Chevron has targeted San Sebastian's studies by hiring epidemiologists to find holes in his study.

"Chevron says we are killing ourselves, contaminating ourselves," says Alfonso Ureña in reference to claims that the people's ills are caused by poor diet, hygiene and promiscuity. "During juridical inspections, we told them, 'If you say the water is not contaminated, drink it.' The representatives of Chevron refuse to drink it."

The case against Chevron began in 1993 with a class-action suit in a New York district court. Thirty thousand Ecuadorian plaintiffs, referred to as "the affected" in Ecuador, brought the suit against then-Texaco for health damages caused by the contamination.

After nine years of legal jockeying, a judge responded to Chevron's claim that jurisdiction did not lie in the United States, and both parties agreed to participate in a case refiled in Ecuador.

In March 2003, the affected used an environmental law passed in 1999 to claim damages against Chevron in the Superior Court of Nueva Loja in the city of Lago Agrio. The suit does not seek indemnity from the company, but that they do an environmental cleanup of all the lands and waters where they worked.

The U.S. firm Global Environmental Operations estimates that such a widespread environmental cleanup would cost $6 billion.

Chevron's lawyers cite three main points in arguing that the company is free of responsibility: the toxins left by Texaco are not harmful; they cannot be proven to be from Texaco; the Ecuadorian government freed the company of responsibility for environmental damage in a 1998 agreement.

Texaco also signed agreements with local municipalities and indigenous communities in an attempt to absolve themselves of a future claim. Evidence of the nearly $2 million given by Texaco to the governments cannot be found in public works or infrastructure. Like many backroom agreements between big business and local government in Ecuador, the funds may have seeped into the pockets of local leaders while the community never knew the agreements were signed.

"No one can condemn us for anything," said Rodrigo Perez, one of Chevron's lawyers in Ecuador. "The Ecuadorian state released us in '98 of all the environmental responsibilities in the Ecuadorian Amazon."

In his posh Quito office, a glass window spans the length of one of the walls overlooking a green mountainside and the poorly constructed brick homes that dot the landscape. Perez is cordial and friendly, but he admits he does not know the scientific details well.

"Not a single case shows (more than) national or international levels of contamination," says Perez of the soil and water samples Chevron tested for the case. "None are even close to breaking the standards."

However, soil tests and satellite photos presented by the plaintiffs show that some of the toxic pits were just bulldozed over with dirt and were not treated to remove the toxins. As part of their publicity effort, the plaintiffs distributed copies of Chevron's and their water and soil tests at the former Sacha Sur drilling site.

The Chevron tests show toxins are present at levels from four to 10 times more than Ecuadorian limits. The United States allows only 100 parts per million (ppm) of total petroleum hydrocarbons (TPH), and Ecuadorian law permits 1,000 ppm.

"Both the tests we conducted and the tests conducted by Texaco show the existence of contamination, and it is contamination in high levels over that which is permitted by Ecuadorian law, U.S. law and the standards Texaco set for its own remediation of 5,000 ppm," says Luis Yanza, coordinator for the affected. "They think by repeating a lie a thousand times, it will become the truth."

Chevron scientists also claim that toxins dumped into the environment over a 30-year period did not cause the illnesses that plaintiffs are suffering from.

"Neither people nor the environment is at risk from oil contamination in the areas remediated by Texpet (Texaco Petroleum)," said Sara McMillen, Chevron's senior environmental scientist, in a press release dated Aug. 8, 2006.

"The cancers of the Amazon were not caused by Texaco, or even Petroecuador. These are lies to try to extort money," says Perez. "They are caused by the life conditions and by the total lack of interest by the government in providing medicine and health care to the people."

A visit to Texaco's former operational site at Lago 2 is an example of why the plaintiffs claim the 1998 release was a mistake by the Ecuadorian government and that Texaco still has more cleaning to do.

Just a few feet past a graveled-over open square in the jungle is a half-buried pipe once used to dump toxic water into the jungle. Slash a machete just a few inches into the ground at any number of spots in the thick jungle overgrowth, and the machete blade reveals a turgid black solid mixed with dirt. The smell is unmistakable: A whiff of the oil residue reminds you of a gas station, not a lush tropical jungle.

A layer of crude lies just a few inches below the surface at what Texaco claims is a clean and safe site.

In 1976, 12 years after Texaco began exploring oil in the Ecuadorian Amazon, the government of Ecuador decided it needed a greater share of the profit. The solution was to form a state oil company, CEPE, that would form a partnership with Texaco.

The two companies formed a consortium whereby CEPE (now Petroecuador) was 70.5 percent partner. Thus, Chevron claims it is only responsible for 29.5 percent of environmental damage, even for sites wholly managed and operated by Texaco. The disputed 1998 remediation agreement corresponded to this percentage, and Chevron allegedly cleaned up its portion at a cost of $40 million. Chevron claims that Petroecuador is responsible for cleaning up the rest.

Chevron also says that Ecuador's state oil company has had dozens of spills that have contaminated areas formerly operated by Texaco, and that any contamination left by Texaco before 1991 cannot be proven.

"Maybe. Maybe there was contamination," Chevron attorney Perez says of the years before the consortium with CEPE began. "But what about Petroecuador, who has the world record in oil spills?"

During 2006, Petroecuador recorded 116 oil spills in the Amazon, 81 of which the company claims were the work of sabotage.

Still, the plaintiffs point the finger at Chevron, claiming that since Texaco managed all the sites, it was Texaco who chose to violate environmental norms by dumping the toxins in the environment.

Eduardo Chapel, 56, an elder in the Cofán Indian village near the city of Dureno, agrees that Texaco is solely responsible. Chapel was one who blocked Texaco from drilling within the Cofán territory in the 1970s. Nevertheless, the company managed to perforate wells at numerous sites along the boundary that affected several of the rivers that provide villagers with drinking and bathing water.

Here, women--including the mother of Gina Lucitante, the 11-year-old who can't speak--washed their clothes every day by standing half-submerged in the estuaries. In such small communities, it is easy to find children handicapped and with Down syndrome, or others with problems like Lucitante's speech defect.

"Those who are living here must have cancer, and we don't know it," says Chapel of the village of 75 families who all live in elevated wood huts with thatched and tin roofs. "Sometimes, the sick die in the middle of the path to Lago; they don't even arrive."

Robinson Yumbo is the indigenous coordinator for the Cofán and other indigenous communities affected by contaminants. "In Ecuador, there were not laws about oil exploration," says Yumbo, whose salary and travel expenses are paid for by the San Francisco-based NGO Amazon Watch. "The norms in the U.S. were not used, even though the ill effects were known. It's an ethical question, not a legal question."

Today, Petroecuador's contract workers trudge in half-body suits through Petroecuador spill sites and remediate contaminated sites left from years before, at the bureaucratic pace of a grossly underfunded state oil company. Sometimes this remediation simply means bulldozing dirt over former toxic pools.

"There is nothing to cultivate," says Milton Curipoma of his family's two hectares of land. "When there is no sun, the ground is hard. When the sun comes out and heats the ground, it turns like gum, like rubber, and the oil naturally rises up through the ground."

With the final soil tests completed last month, the plaintiffs are confident they have the evidence, both scientific and human, to prove their case in an Ecuadorian court, yet much remains unclear. Chevron asks why the judge in the case has been prevented six times from visiting the laboratory used by the plaintiffs. The plaintiffs claim Chevron is deliberately testing at higher ground, away from water flows and at sites where they know no contamination has occurred.

Chevron lawyers have the money to fund an appeal and pay for cases in the United States directed at defending their 1998 remediation. The defense has the propaganda against "big oil" to fight back with popular protests and political pressure.

If either side loses, an appeal would go to Quito's Supreme Court. Lawyers on both sides expect a possible decision by early 2008; an appeal could take another year after that.

With each year that passes, more children like Lucitante will be born unable to speak, and villagers will visit more relatives' graves on Day of the Dead. And with each hot Amazonian rain, deep underground, heavy metal toxins will move closer to groundwater sources that citizens drink and bathe in.