Chevron: A Financial
House of Cards Collapsing?
Coalition of Chevron-Affected Communities Release an Alternative Annual Report for Chevron on Eve of Company's Annual Shareholder Meeting
May 26, 2009
Media Contacts:
Nick Magel, 419-283-2728
nick@amazonwatch.org
Antonia Juhasz, 415-846-5447
antoniajuhasz@gmail.com
FOR IMMEDIATE RELEASE
San Francisco – At a press conference today in San Francisco, a unique coalition of communities directly affected by Chevron from across the United States and around the world called on the company to come clean to its shareholders and the public as to the true costs associated with its operations and to clean up its act, not just its image. The coalition warned that Chevron's failure to take immediate action would result in a continuing cascade of lawsuits and public opposition to its operations, severely threatening is financial stability.
As Chevron's shareholders confront the prospect of a $27 billion judgment against the company in Ecuador, widespread shareholder discomfort and growing community opposition and mounting public scrutiny, "The True Cost of Chevron: an Alternative Annual Report" details Chevron's global operations and the grave consequences for communities impacted by Chevron's operations.
Report lead author and editor, Antonia Juhasz, explained that the reports from people and their allies who directly bear the consequences of Chevron's operations, reveal a "consistent theme of a company operating in violation of environmental, public health and safety, and consumer laws; in flagrant disregard for basic human rights; in support of some of the most repressive regimes in the world; and far too often willing to avail itself of the use of some of the world's most notoriously brutal militaries."
The united movement organized to counter Chevron's negative social and environmental impacts across the United States and around the globe is leading shareholders to question if Chevron can continue to operate with impunity. The groundbreaking 44-page report details numerous active lawsuits against the company from across the country and around the world, with potential liabilities in excess of Chevron's total revenue from 2008, posing a material threat to shareholder value and the company's bottom line.
Tunde Okorodudu of Nigeria stated that "what is bad for my people is also bad for business. Chevron needs to invest in local communities where they are taking millions in profits while my people suffer." Paul Donowitz of EarthRights International spoke of Chevron's operations in Burma where it partners with the brutal military junta on the Yadana Gas Project. "This project has directly led to massive and widespread human rights abuses, including forced labor, murder, rape, forced relocation of villagers, all the while enriching the junta who use this revenue to oppress their own people," explained Donowitz.
Atossa Soltani Executive Director of Amazon Watch provided compelling indicators of how Chevron management is mishandling the Ecuador case. She pointed out that some of the country's largest pension funds, key financial analysts, and now New York Attorney General Andrew Cuomo are challenging the company on Ecuador. On May 4th, Cuomo opened an investigation of Chevron to determine if it is misleading shareholders about the financial risks the company faces in Ecuador, where an Ecuadorian court is likely to rule as early as this Fall that Chevron has a more than $27 billion liability. "Chevron's management is burying its head in the sand on the company's environmental liability in Ecuador while Chevron's board is shirking its fiduciary duty to shareholders. The board is asleep at the wheel and allowing Chevron management to mishandle this case."
"Chevron's environmental disaster in Ecuador has poisoned 30,000 indigenous and campesino residents and because of CEO David O'Reilly and the board's poor handling of the case, it has become apoison pill for Chevron stockholders. "
Michelle Kinman of Crude Accountability described the health impacts on communities in Kazakhstan, where Chevron is the country's largest private oil producer. "Chevron's operations have been mired in gross public health, environmental, human rights, and labor violations," Kinman explained. "At both the Tengiz and Karachaganak fields, surrounding populations have suffered greatly from an unprecedented variety of illnesses upon development of the fields, including respiratory illnesses, blood illnesses, cardiovascular illnesses and high levels of stillborn babies, all of which medical specialists have determined to be directly related to the oil industry."
Juhasz noted that while Chevron has tried to recast itself through its Human Energy ad campaign as a "green" company that is "part of the solution" to global warming, it is instead, at best, spending less than 3% of its total capital and exploratory expenditures on clean alternative energy in 2008.
Brant Olson of Rainforest Action Network explained that at the same time, Chevron is operating a coal company, "the most carbon-intensive fossil fuel," explained Olson. Chevron is "a chemical company producing a host of toxic and environmentally destructive chemicals and products, and is expanding into environmentally destructive methods of oil production, such as from the Canadian tar sands and Midwestern shale."
In Richmond, California, "the community struggles for economic and environmental justice as Chevron continues to try to avoid paying its fair share of local taxes," explained Marilyn Langlois of the Richmond Progressive Alliance.
"While the EPA lists the refinery in ‘significant noncompliance' for air pollution standards, Chevron wants to refine dirtier, more polluting oil from Canada's tar sands," explained Jessica Tovar of Communities for Better Environment. The group, together with Earthjustice, won a significant victory this week against the company, when the Contra Costa Superior Court issued a tentative ruling in support of the communities' concerns and against Chevron's planned retooling.
While Chevron's 2008 Annual Report contends "meeting future demand will be one of the world's great challenges — but one that Chevron is convinced can be met in an environmentally-responsible way," report cosponsor Kirsten Moller of Global Exchange, explained that "nothing in our report supports such a contention. Nor does it indicate that Chevron will be able to do so in a manner that protects social, political, or human rights."
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