Chevron Accuses Richard Cabrera Of Voodoo Economic In Ecuador

Professor Richard Cabrera, the economist who's estimates have served to frame the environmental damage terms of debate in the court battle between giant oil company Chevron and the coutry of Ecuador, has been accused of what could be called "Voodoo Economics" by the San Ramon-based firm.

In a damaging press release, Chevron write the following:

Despite an awareness of these fundamental defects, Cabrera’s amended assessment makes no effort to correct any prior mistakes and introduces a new series
of egregious errors, such as:

• Recommending more than $9 billion in damages associated with “excess cancer deaths” without identifying a single victim, let alone providing any corroborating documentation such as a death certificate or a medical diagnosis.
• Recommending more than $3 billion in damages associated with groundwater contamination
even though his own data clearly indicate no such contamination exists, and Cabrera
acknowledges that he has no basis for devising a remediation plan or developing a cost estimate.
Rather, Cabrera simply adopts plaintiffs’ counsel’s demands to assess damages and repackages
them as fact.
• Conceding that his work was conducted in such a fashion as to assign blame to Chevron instead
of performing an objective and unbiased scientific analysis of current environmental conditions,
as the court had ordered.

Their assertions continue and essentially build a case to attack Cabrera's work. But my charge has been it's almost impossible to find anything about Cabrera online, other than his work on the Ecuador lawsuit against Chevron, where the country is attempting to have the oil firm pay entirely for environmental damage that Ecuador itself is largely responsible for. In this matter, Cabrera has filed fraudulent economic report claims, making estimates of monetary damage costs without providing substantiated evidence to support his report findings.

Bowoto v. Chevron Is Back In Court Feb 6th 2009

Bowoto v. Chevron Is Back In U.S. 9th District Court, Northern California, San Francisco, Feb 6th 2009 and for the purpose of the plaintiffs explaining why a new trial is needed. 


The plaintiffs (Bowoto) believe that the core idea that claims Chevron acted in violation of the Alien Tort Act was not understood by the jury, but given the nature of the incident -- tresspassing by Bowoto -- it's hard for me to see how they can make that claim.

OPEC cuts record 2.2. million barrels a day | ajc.com

OPEC move will raise oil prices From AP and AJC: “ORAN, Algeria — OPEC on Wednesday agreed to slash a record 2.2 million barrels from its daily production as of Jan. 1, while the bloc's outsiders Russia and Azerbaijan announced their own cutbacks of hundreds of thousands of barrels from the market.

Oil prices tumbled close to four-year lows after the announcement, however, a clear indication of the growing belief that the world is heading for a long and painful recession in which energy use will continue to erode.”

--- Just what we need now in this bad economy, more high gas and energy prices. Americans should cut back on car use ASAP. But this also signals a need to have fuel-efficient cars and keeps Detroit on the hook.

Chevron eyes higher production of ethanol-blended fuel - BusinessWorld Online:

BusinessWorld Online: Chevron eyes higher production of ethanol-blended fuel

Chevron v. Ecuador - Can Chevron Get A Fair Trial? Appellate Court Screws Up

As some of you know, we've been following the Chevron - Ecuador story for some time now.  To recap, the problem is that in the 1960s Texaco produced oil out of that country and through 1990 and in partnership with the Country of Ecuador .  During that time, there were oil spills and economic damage due to oil production.  Texaco spent $40 million in "environmental remediation" which is another term for carrying out a cleanup program.  


Chevron purchased Texaco in 2001 for 46.3 billion, thus assuming Texaco's work and responsibilities in Ecuador.  By that time, Ecuador's then-new state-owned petroleum organization Petroecuador assumed responsibility for the oil wells that were once the product of the partnership.  But the problem is that since that time and through today, oil spills and environmental damage have continued, but Petroecuador has done nothing to either prevent the occurrence of or clean up what was done.  


Meanwhile, the Country of Ecuador has moved to work on three fronts: 


1) Nationalize the oil industry via Petroecuador
2) Kick out American oil companies like Occidental Petroleum and take over their production facilities.
3. Sued Chevron Texaco to get money to pay for environmental damage that their own state-owned oil company, Petroecuador, caused



The third point is the focus of my blog.  Ecuador's suing Chevron to have them pay the afforementioned damange.  To that end, they were assisted by a lawyer by the name of Steve Donziger, who had been working on the case as an "American Legal Advisor",  but who has also admitted his own financial ambitions as he could gain $5 billion from a victory .  The lawsuit -- valued at $16.5 billion by one estimate -- has been the focus of much legal movement.  The latest action by Chevron had it file an appeal to have Ecuador enter into arbitration discussions regarding the level of liability each party is responsible for.  But there's one large problem. 


The appellate court doesn't understand the contractual relationships. It calls Chevron a "third party."  


What!?!


When Chevron purchased Texaco it essentially became Texaco, with all of its obligations and problems. Thus, it's not a third party.  But even with this fact, the U.S. Court of Appeals for the Second Circuit in New York took the step of ignoring Chevron's claims of being able to pursue arbitration by seeing it as a "third party" when it's not.


The result of this failure means that Chevron now must seek other legal tools to get Ecuador to pay its fair share, but the other problem is more sinister: Ecuador's rich continue to cover-up their behavior and irresponsibility toward that country's poorest people.  Making it look like it was just Chevron's fault does not erase the fact that Ecuador has been harming its poorest people.


The bottom line here is that just because a firm's an oil company does not mean it should be treated unfairly, especially when the lives of the poor of Ecuador are at stake.  Chevron / Texaco has paid and does its share; the Country of Ecuador, which by the way will never give Chevron a fair trial, has not done so. 

"YES ON H" - San Francisco's Quest For Clean Energy November 4th

On November 4th a very important vote is coming to San Francisco. It's called "Yes on H" and if it passes, this is what it will do:

Specifically, the Act directs the City to analyze, identify and pursue strategies that:

Maximize greenhouse reductions from the electricity sector at the minimum cost including the following clean energy mandates: by 2012 ensure at least 107 megawatts; by 2017 ensure 51%; and by 2030 ensure 75%. The SFPUC shall ensure that 100% or the greatest amount technologically feasible or practicable are met through clean energy by 2040. Nuclear is prohibited from being included in the definition of clean energy.

Investigate ways to improve electric service and reduce costs to customers, including through measures such as Community Choice Aggregation.

Establish an Independent Ratepayer Advocate to represent the interests of ratepayers and ensure affordable and reliable service.

Develop a Green Jobs plan providing workforce development for clean energy, construction and operations in PUC jurisdiction. Any PG&E employees who become City employees as a result of this Act will not suffer any reduction of compensation or seniority.

Evaluate the financial and environmental benefits of locally controlled electricity services, including renewable energy and energy efficiency. This includes a cost-benefit analysis of municipalizing the electric system, as well as shorter-term measures such as Community Choice Aggregation.

Seems like a no-brainer, and it is. One problem is that SF Mayor Gavin Newsom's not behind it, and no one seems to have a good reason why, including Mayor Newsom. Not a good idea for someone running for Governor of California.