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STRATUS CONSULTING Scientific Evidence in the Aguinda et al. v. Chevron Case Douglas Beltman Stratus Consulting Boulder, CO

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  • STRATUS CONSULTING

    Scientific Evidence in the Aguinda et al. v. Chevron Case

    Douglas BeltmanStratus Consulting

    Boulder, CO

  • STRATUS CONSULTING

    Outline

    Texacos operations in Ecuador History Data on contamination

    Chevrons false claims that Petroecuador is responsible for the contamination Texacos ineffective cleanupEnvironmental damages estimatesChevron defense positions re: the scientific evidence against them

  • STRATUS CONSULTING

  • STRATUS CONSULTING

    Texacos Oilfield Operations in Ecuador

    Texaco drilled and operated 356 oil wells and built 22 production stations from 1967 to 1990Petroecuador took over operations in 1990; Texaco out of consortium in 1992

  • STRATUS CONSULTING

    Wells Opened and Operated by Texaco

    0

    10

    20

    30

    40

    50

    60

    1967

    1968

    1969

    1970

    1971

    1972

    1973

    1974

    1975

    1976

    1977

    1978

    1979

    1980

    1981

    1982

    1983

    1984

    1985

    1986

    1987

    1988

    1989

    1990

    Year

    Num

    ber o

    f wel

    ls

  • STRATUS CONSULTING

  • STRATUS CONSULTING

    Texaco Operations

    River Station

    Crude

    Esmeraldas

    Well

    Well

    WellWell

    WellWell

    Well

    Gas

    Producedwater

  • STRATUS CONSULTING

    Primary Sources of Contamination from Texacos Operations

    916 unlined, abandoned pits with wastes from wells (based on aerial photo analysis)

    Photo credit:L. Dematteis

  • STRATUS CONSULTING Courtesy of M. Pallares

  • STRATUS CONSULTING

    A Texaco oil well after drilling is completed. Oil pits are clearly visible.

  • STRATUS CONSULTING

    Oil roads and wellpads opened the area to development. This photo shows a school located adjacent to a Texaco well and pit

    Courtesy of M. Pallares

  • STRATUS CONSULTING

    Pits

    Used for disposal of well drilling, development, and production wastes Unrecovered oil Drilling muds Chemicals used to develop the wells

    (acids, biocides)

    One of Texacos oil pits (photo taken in 2008)

  • STRATUS CONSULTING

    Texaco Pits Constructed without linersConstructed with built-in overflow pipesUsed for permanent disposal

    One of Texacos oil pits (photo taken in 2008)

  • STRATUS CONSULTING Courtesy of M. Pallares

    Schematic showing environmental pathways by which Texacos pits cause contamination

  • STRATUS CONSULTING

    Pit Usage in the U.S.

    Reserve pits common in the past, and still in useRegulations and industry guidance going back to the 1940s: Must be designed to prevent contamination of

    groundwater, surface water (usually lined, but not always depending on usage and site conditions)

    Used for temporary storage only (weeks to a few months)

    Tanks used instead of pits where possibleIn Ecuador, Texaco built pits designed to contaminate (no liners, overflow pipes directly to streams) and left them as permanent waste sites

  • STRATUS CONSULTING

    1962 Guide from American Petroleum Institute Showing Industry Standard

    Figure from API document

  • STRATUS CONSULTING

    Produced Water

    Texaco audits show that they discharged ~18 billion gallons from 1972-1990 into streams and rivers

    Photo credit:M. Pallares

  • STRATUS CONSULTING

    Oilfield Produced Water

    Produced water occurs underground with oil and has to be separated from the oil at the surfaceTypically contains salts from the host rock and hydrocarbons from the oil and any chemicals injected into the well to aid in production

    Pipes formerly used by Texaco to discharge produced water at one of its 22 processing stations (now used for stormwater discharge)

  • STRATUS CONSULTING

    Produced Water

    Petroecuador began reinjecting produced water soon after it took over operations 1990; now all is reinjectedData from Texacos time show that the produced water was toxic to aquatic life and contained high levels of petroleum hydrocarbons

  • STRATUS CONSULTING

    Oilfield Produced Water

    U.S. regulations for onshore discharge of produced water date back to the 1920sSince the 1920s, produced water is typicallyreinjected or treated to standards

    Texaco dumped all of their produced water directly into rainforest rivers and streams used by local residents for drinking, bathing, washing clothes, etc.

  • STRATUS CONSULTING

    Oil (TPH) in Produced Water Discharged by Texaco to Streams and Rivers

    TPH in Agua de Formacion

    0

    5

    10

    15

    20

    25

    30

    Agu

    aric

    o

    Ata

    cpi

    AV

    GA

    uga

    cent

    ral

    Aug

    a S

    ur

    Con

    onac

    o

    Lago

    Nor

    te

    Sac

    haC

    entra

    lS

    acha

    Nor

    te N

    o.1

    Sac

    haN

    orte

    No.

    2

    Sac

    ha S

    ur

    Shu

    shuf

    indi

    Cen

    tral

    Shu

    shuf

    indi

    Nor

    teS

    hush

    ufin

    diS

    urS

    hush

    ufin

    diS

    ur O

    este

    Yuc

    a

    Yuc

    a

    TPH

    (mg/

    L)

    Ecuador limites: 0.325 mg/L TPH

    Data source: Fugro-McClelland, 1992, which one of Texacos own audits of their operations in Ecuador

  • STRATUS CONSULTING

    BTEX in Texaco Produced Water Discharged to Streams and Rivers

    0

    500

    1000

    1500

    2000

    2500

    3000

    Sacha Central Shushufindi N Shushufindi S

    Con

    cent

    ratio

    n (u

    g/L)

    Benzene Toluene Ethylbenzene Xylenes

    Data source: Jocknick et al., 1994

    EPA benzenestandard: 5 ug/L

  • STRATUS CONSULTING

    Other Sources of Contamination

    Oil spills from pipelinesTexacos audits: Texaco never had any spill detection or response programs in their ~25 years of operation

  • STRATUS CONSULTING

    Other Sources of Contamination

    Oil poured on roads

    Photo credit:L. Dematteis, M. Pallares

  • STRATUS CONSULTING

    Other Sources of Contamination

    Air pollution from open burning of pits, flaring

    Photo credit:M. Pallares

  • STRATUS CONSULTING

    Data on Contamination

    Historical studies (prior to trial)Data collected as part of the trial Judicial inspections (plaintiffs, Chevron) Cabrera and his team

  • STRATUS CONSULTING

    Investigations conducted in the Napo Concession prior to the trial Study author Conducted on behalf of Study dates What was sampled Reference HBT AGRA Chevron-Texaco and

    Petroecuador 1992-1993 Soil, surface water,

    produced water HBT AGRA, 1993

    Fugro-McClelland Chevron-Texaco and Petroecuador

    1964-1990 Crude oil, produced water, surface water, groundwater

    Fugro-McClelland West, 1992

    Centro para Derechos

    Economics y Sociales 1994 Surface water, produced water

    Jochnick et al., 1994

    Woodward-Clyde International

    Chevron-Texaco 1995-1998 Soil, water in pits Woodward-Clyde International, 2000

    Ministry of Energy and Mines, Ecuador

    Petroecuador; Controller of the State of Ecuador

    1997-2001 Produced water, soils, water in pits

    Contralaria General del Estado, 2003

    Instituto de Epidemiologa y Salud Communitaria Manuel Amunrriz

    Instituto de Epidemiologia y Salud Communitaria Manuel Amunarriz

    1999 Surface water San Sebastin et al., 2002

    Instituto de Epidemiologa y Salud Communitaria Manuel Amunrriz

    Instituto de Epidemiologia y Salud Communitaria Manuel Amunarriz

    1999 Surface water San Sebastin et al., 2005

    Laboratorio de Suelos, Aguas, Plantas y Balanceados

    Colegio Fisco-Misional Tcnico Agropecuario Padre Miguel Gamboa

    2000 Surface water, groundwater, sediment

    Laboratorio de Suelos, Aguas, Plantas y Balanceados, 2000

  • STRATUS CONSULTING

    Sites Sampled During the Trial(out of 356 wells, 22 stations)

    934945Total

    12111Stations

    814834Wells

    TotalCourt Expert (2007)

    Judicial Inspections

    (2003-6)

  • STRATUS CONSULTING

    Judicial Inspections

    Soils, sediment, groundwater, surface waterPetroleum (TPH), components of petroleum, metals~64,000 analyses total

  • STRATUS CONSULTING

    Number of Samples

    Matrix Plaintiffs Chevron Total Soil 351 838 1,189 Watera 103 328 431 Crude 4 12 16 Otherb 0 28 28 Total 458 1,206 1,664 a. includes surface water, groundwater, and production water. b. includes asphalt, leachate, and quality control samples.

  • STRATUS CONSULTING

    TPH in Soil

    Ecuador standard: 1,000 mg/kg TPHUS standard: Regulated by State, standards vary Recent shift toward regulation of BTEX

    and away from TPH 100 mg/kg TPH common standard in the

    past

  • STRATUS CONSULTING

    TPH in Soil

    97%99%Total(93 sampled)

    92%92%Stations (12 sampled)

    98%100%Wells(81 sampled)

    % sites with TPH > 1,000

    mg/kg

    % sites with TPH > 100

    mg/kg

  • STRATUS CONSULTING

    TPH in Soil

    TPH

    (ppm

    )

    100

    1000

    10000

    100000

    1000000

    EcuadorianLaw

    Maximum TPH sampled at each site

  • STRATUS CONSULTING

    Chevron collected samples only from locations away from the pits to show no contamination. This was typical of their sampling approach during the trial.

    The Plaintiffs (or Demandantes) data document the extremely high petroleum contamination at the site. The units are mg/kg, or ppm, and 400,000 mg/kg = 40% oil.

  • STRATUS CONSULTING

    TPH in Groundwater

    32%104Court Expert (Cabrera)

    1%192Chevron

    59%39Demandantes

    % > 0.325 mg/L TPH

    No. samples

  • STRATUS CONSULTING

    Petroecuador or Texaco?

    Petroecuador took over operations in 1990The plaintiffs case is based only on sites built by Texaco, not any built by Petroecuador ~25% of the sites operated by Texaco only

    Most well site contamination occurred during drilling and initial development, not ongoing production -once production started, all material was sent directly to processing stations in a closed systemPetroecuador improvements over Texaco Produced water reinjection Oil spill detection and response Well waste handling

  • STRATUS CONSULTING

    TPH in Soil

    98%100%Texaco, then Petroecuador

    96%100%Texaco only

    % sites with TPH > 1,000

    mg/kg

    % sites with TPH > 100

    mg/kg

    Well built by Texaco, then operated by:

  • STRATUS CONSULTING

    Texaco Pit Cleanup in the 1990s

    Chevron claims that they spent $40 million on a cleanupin the 1990sThe cleanup was ineffective: They touched only 16% of their pits; e.g., they declared

    pits with water being used by local communities (drinking water, fish farms) as not requiring cleanup, without confirmatory sampling

    High/meaningless cleanup standard 1,000 mg/L TCLP (which is orders of magnitude higher

    than the solubility limit of oil in the TCLP leaching solution)

    Poor confirmatory sampling Data from the trial consistently show higher

    contamination than in their cleanup confirmatorysampling

  • STRATUS CONSULTING

    TPH in Soil

    97%100%No

    98%100%Yes

    % sites with TPH > 1,000

    mg/kg

    % sites with TPH > 100

    mg/kg

    Well site built and remediatedby Texaco?

  • STRATUS CONSULTING

    Table 1. Texpet cleanup pits with TPH concentrations greater than 5,000 ppm.

    Field name Well Pit

    numberIn

    RAPa No further

    actionb Remediation

    completec Maximum TPH (ppm)

    Source for maximum TPH Well operated by

    Aguarico Aguarico 8 Pit 1 Yes No Yes 8,183 Examen Pericial Texaco Aguarico Aguarico 9 Pit 1 Yes Yes No 13,947 Examen Pericial Texaco-Petroecuador Aguarico Aguarico 10 Pit 1 Yes Yes No 17,544 Examen Pericial Texaco-Petroecuador Aguarico Aguarico 10 Pit 3 Yes Yes No 8,181 Examen Pericial Texaco-Petroecuador Atacapi Atacapi 5 Pit 1 Yes No Yes 21,976 Examen Pericial Texaco Auca Auca Sur 1 Pit 2 Yes Yes No 40,102 Examen Pericial Texaco-Petroecuador Auca Auca Sur 1 Pit 3 Yes Yes No 29,979 Examen Pericial Texaco-Petroecuador Guanta Guanta 4 Pit 1 Yes No Yes 5,510 Examen Pericial Texaco-Petroecuador Lago Agrio Lago Agrio 1 Pit 1 Yes Yes No 21,521 Examen Pericial Texaco-Petroecuador Lago Agrio Lago Agrio 5 Pit 1 Yes No Yes 8,830 Examen Pericial Texaco Lago Agrio Lago Agrio 5 Pit 2 Yes Yes No 20,923 Examen Pericial Texaco Lago Agrio Lago Agrio 16 Pit 1 Yes Yes No 175,095 Texaco Texaco-Petroecuador Parahuacu Parahuacu 3 Pit 1 Yes No Yes 2,065 Examen Pericial Texaco Ron Ron 1 Pit 1 Yes No Yes 9,632 Examen Pericial Texaco Sacha Sacha 18 Pit 1 Yes Yes No 41,306 Examen Pericial Texaco-Petroecuador Sacha Sacha 18 Pit 2 Yes No Yes 35,380 Examen Pericial Texaco-Petroecuador Sacha Sacha 21 Pit 2 Yes No Yes 17,000 Texaco Texaco-Petroecuador Sacha Sacha 51 Pit 4 Yes No Yes 7,200 Texaco Texaco-Petroecuador Sacha Sacha 51 Pit 5 Yes Yes No 63,000 Texaco Texaco-Petroecuador Sacha Sacha 53 Pit 1 Yes No Yes 7,430 Demandantes Texaco-Petroecuador Sacha Sacha 57 Pit 2 Yes No Yes 8,100 Texaco Texaco Sacha Sacha 65 Pit 1 Yes No Yes 32,444 Demandantes Texaco-Petroecuador Sacha Sacha 85 Pit 1 Yes Yes No 20,000 Texaco Texaco-Petroecuador Sacha Sacha 94 Pit 1 Yes No Yes 5,600 Texaco Texaco Sacha Sacha 94 Pit 2 Yes No Yes 8,700 Texaco Texaco Shushufindi Shushufindi 7 Pit 1 Yes No Yes 5,334 Demandantes Texaco-Petroecuador Shushufindi Shushufindi 7 Pit 2 Yes No Yes 12,715 Demandantes Texaco-Petroecuador Shushufindi Shushufindi 8 Pit 1 Yes Yes No 7,350 Demandantes Texaco-Petroecuador Shushufindi Shushufindi 13 Pit 1 Yes No Yes 7,415 Demandantes Texaco-Petroecuador Shushufindi Shushufindi 13 Pit 3 Yes Yes No 27,001 Demandantes Texaco-Petroecuador Shushufindi Shushufindi 21 Pit 1 Yes No Yes 16 033 Demandantes Texaco-Petroecuador

    This table shows examples of the contamination remaining at pits cleaned by Texaco, regardless of data source. No further action means Texaco decided during cleanup that no cleanup was required (e.g., pits were being used by local communities)

  • STRATUS CONSULTING

    Court Expert Report on Environmental Damages

    The Ecuadorian Court appointed an expert to prepare an estimate of environmental damages caused by TexacoPer court authorization, he considered and relied in part on materials prepared by Stratus Consulting (and many others)He issued two reports, the second updating the damages estimates of the first

  • STRATUS CONSULTING

    Environmental Damages in the Court Expert Reports

    $0.9 to $1.7B

    $0.9 to $1.7B

    Rainforest habitat impacts$375M$375MOil field infrastructure$430M$430MIndigenous impacts$428M$428MDrinking water system$480M$480MHealthcare system$3.2B-Groundwater remediation$2.7B$1.7BSoil remediation

    Nov 2008

    March 2008

    Category

  • STRATUS CONSULTING

    Environmental Damages in the Court Expert Reports

    $18.1-$18.9B$7.2-$8.0BTotal w/o unjust enrichment

    $26.5-$27.3B$15.5-$16.3BTotal

    $8.4B$8.3BUnjust enrichment$9.5B$2.9BCancer deathsNov 2008March 2008Category

  • STRATUS CONSULTING

    Environmental Damages Quantified by Plaintiff Experts

    Plaintiffs submitted a separate environmental damages report prepared by:Douglas Allen, who has 25 years of experience as an environmental consultant working in soil and groundwater remediationDr. Lawrence Barnthouse, one of the nation's leaders in ecological risk assessment and a Fellow at the American Association for the Advancement of ScienceCarlos Emilio Picone, a medical doctor certified in critical care medicine and Chiefof the Pulmonary Section at Sibley Memorial Hospital in Washington, D.C.Jonathan S. Shefftz, a financial economist from Harvard who has performed economic modeling on theories of unjust enrichment for the U.S. Environmental Protection Agency and the U.S. Department of EnergyDr. Daniel L. Rourke, who has extensive experience applying advanced statistical techniques to solve complex litigation problems; andDr. Robert Paolo Scardina, a civil and environmental engineer and member of the faculty at the Virginia Polytechnic Institute.

  • STRATUS CONSULTING

    Environmental Damages Quantified by Plaintiff Experts

    Identified the damage categories as used in the court experts report as being appropriateTotal damages estimate: up to $113 billion

    [Chevron was requested by the court to submit their own damages estimates, but they refused to, and now criticize the process as unfair]

  • STRATUS CONSULTING

    Number of Cancer Cases per Family

    Source: Examen Pericial, Annex L, 2008

    0.00%

    5.00%

    10.00%

    15.00%

    20.00%

    25.00%

  • STRATUS CONSULTING

    Cancer Rates in Women

    Source: Hurtig and San Sebastian, 1992

  • STRATUS CONSULTING

    Chevron Positions re: Scientific Evidence

    They deny that there is contamination by claiming: Plaintiff data and court expert data are unreliable Chevron data show no/little contamination (but see

    earlier slide about their sampling approach)They say that any contamination is going away on its own and doesnt require cleanup (but sites left untouched for 20 years remain highly contaminated)They say there is no proof of cause-effect for any individual in the area with cancer (ignoring the epidemiological studies)They make personal attacks on the scientists working for the Plaintiffs

  • STRATUS CONSULTING

    Conclusions

    There is overwhelming scientific evidence that Texaco operated the oilfield with few or no environmental controls, and that their operations caused massive environmental contamination that persists todayBoth a court-appointed expert and a group of highly respected experts hired by the plaintiffs estimate the environmental damages at up to many tens of billions of dollarsChevrons defense strategy is to ignore most of the scientific evidence, publicize false or misleading information, and make personal attacks