Chevron has an “Outstanding Year,” while Tengiz Trembles

Azamat Maitanov
Ak Zhaik: Atyrau Weekly
June 9, 2011

On May 25, at its headquarters in San Ramon, California, the Chevron Corporation held its annual shareholder meeting. At the meeting, the international environmental organization Crude Accountability—a steadfast challenger of Chevron—tried to raise the topic of environmental pollution in Western Kazakhstan.

Crude Accountability is a civil society organization that studies the consequences of Chevron’s actions on the environment, including in Kazakhstan. Let us remind the reader that Chevron has a 20% interest in the Karachaganak Field and a 50% interest in Tengizchevroil.

At the shareholder meeting, which took place in a relaxed setting with the clinking of champagne glasses, Chevron’s CEO John Watson, called 2010 an outstanding year for the company. But, a “spoon of tar” was added to the meeting by the American “greens” invited to the meeting.* In particular, Leanne Grossman, a representative of Crude Accountability, handed over to Watson an appeal signed by 124 residents of the village of Berezovka in Western Kazakhstan Oblast. The residents of this village have been campaigning for the last nine years for relocation from the impact zone of the Karachaganak Oil and Gas Condensate Field and for compensation for damages.

However, Watson simply dismissed the letter without reading it, replying inaccurately, “We are in compliance in Kazakhstan.”

The Ground Rumbles

In addition, on May 31, Crude Accountability held a press conference in Almaty on the topic of “The True Cost of Chevron: An Alternative Annual Report.” According to Sergey Solyanik, Crude Accountability’s consultant in Kazakhstan, this report documents Chevron’s violations in California, Burma, Colombia, Ecuador, Kazakhstan, Nigeria, the Philippines and the US Gulf Coast.

“In 2010, the consortium “Karachaganak Petroleum Operating B.V.,” which includes Chevron, was fined $13.5 million dollars for excessive emissions. In addition, Kazakhstan filed a claim for $12.9 million in compensation for damages. And in 2010, Tengizchevroil was fined nearly $64 million for environmental pollution,” stated S. Solyanik.

The environmentalists also write in the report about the appearance of sinkholes in the ground around Berezovka. Similar phenomena have been observed in other parts of the world where Chevron operates.* N. Kurbanov, a geophysicist from the Atyrau Institute of Oil and Gas, warns that the oil extraction techniques used at Karachaganak can result in major catastrophe—the fields themselves and nearby areas can abruptly cave in.

“In March of this year, an accident occurred at Karachaganak due to equipment failure. As a result of exposure to hydrogen sulfide, one employee died instantly, a second was found unconscious and resuscitated. Protection gear, a gas monitor and safety training all failed to save these people. In light of this accident, the residents of Berezovka are increasingly concerned because they do not know what they would do in an emergency. In the event of an accident, they would have little chance of escaping to a safe place,” continues Sergey Solyanik.

A “Failing” Tengiz and Turkmenistan’s Abundant Gas

According to the chapter in the report by Crude Accountability, which includes information on Tengizchevroil’s operations: “In 2010, TCO was a leading environmental polluter in Kazakhstan….Even so, these record contamination levels fail to reflect the full scale of TCO’s pollution as they were based on monitoring of only five elements; TCO emits more than 40 substances in the air…In February 2011, an atypical 4.0 earthquake occurred in the area of the Tengiz Field….the Kazakhstan Nuclear Center and the Institute of Seismology issued statements that the unusual intensity of the earthquake is directly associated with extraction activities at Tengiz. Finally, despite TCO’s claims of using advanced technology, the company consistently registers high numbers of emergencies—55 in 2008, 75 in 2009, and 43 in the first half of 2010. These incidents have been caused largely by the use of failing equipment.”

It has not escaped Crude Accountability’s notice that a shameful principle of “oil in exchange for democracy!” is in play here, as practiced by many western transnational corporations.

“Today Chevron is courting Turkmenistan—one of the most repressive governments in the world. But this is not a problem for the company as Turkmenistan’s gas reserves are the fourth largest in the world,” ascertains S. Solyanik.

In August 2010, Turkmenistan invited Chevron to develop promising offshore blocks in the Caspian Sea. When the offer of a tasty morsel of hydrocarbons is on the line, it is possible to forget about principles.*

Translated by Crude Accountability

1. Translator’s Note: Environmental organizations and community leaders from around the United States and the world entered the shareholder meeting via legal proxies from shareholders. However, invitations were not issued from Chevron to the environmental community.

2. Translator’s Note: Crude Accountability reported that exploration and drilling activities, such as those taking place at Karachaganak, have been linked to the appearance of sinkholes in other areas of the world. However Crude Accountability did not specify in the report that Chevron has been involved in these other areas.

3. Translator’s Note: In August 2010, Turkmenistan invited Chevron and a few other companies to submit proposals for the development of offshore blocks. To date, there has not been an official announcement of any company winning the tender.