Exxon Mobil: Corporate Crimes

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Politics and Globalisation

ExxonMobil support numerous right-wing and conservative think-tanks and lobby groups (see PR Companies and Lobbying Groups for examples). They promote everything from environmental deregulation to cuts in social welfare spending. ExxonMobil is also a strong proponent of so-called 'free trade' (globalisation).

Alaska's Arctic National Wildlife Refuge

"[A]llowing environmentally responsible exploration of the Arctic National Wildlife Refuge and prospective areas offshore and in the Rocky Mountains should be priorities"
- H J Longwell, Senior Vice President, ExxonMobil, February 13, 2001 [1]

The Arctic National Wildlife Refuge is an ecologically sensitive area hosting numerous species. The indigenous Gwich'in people, who rely on the Caribou herds that breed there, are opposed to the development.

So far this area has been untouched by development. The oil industry however is lobbying congress to open up the refuge for exploitation. ExxonMobil supports organisations like The Heritage Foundation that are working for the opening of the refuge. The House of Representatives now support plans to drill for oil and gas in the Arctic Wildlife Refuge. Before any drilling can commence, it still has to be approved by the Senate. With Bush in the Whitehouse, it could be just a matter of time before this small piece of vulnerable land loses its protection.

Climate Change

Exxon has been in the forefront of fighting any action on climate change. The tactics have varied from denying the science, to denouncing the Kyoto Protocol, to playing the developing world and the developed countries against each other. Exxon has supported, and continues to support, lobby groups and think-tanks working against action on climate change or trying to undermine confidence in climate science. Examples include The American Enterprise Institute and The Center for the Study of Carbon Dioxide and Global Change. Exxon was also a member of The Global Climate Coalition (see Influence/Lobbying section for more info on these three organisations). For information on ExxonMobil's sponsoring of climate sceptics, see 'ExxonMobil Emerges as a Major Funder of Greenhouse Sceptics' (March 2001) by Ross Gelbspan at http://www.heatisonline.org/contentserver/objecthandlers/index.cfm?id=3645&method=full.

The two-faced game they are playing can be exemplified by the way they render the Kyoto Protocol useless because developing countries have not committed themselves to CO2 targets, while at the same time lobbying developing countries not to sign up to any binding targets. The following quotes well exemplify this.

"If action is needed [on global warming], it should... include developing nations, since they will account for most of the growth in greenhouse gas emissions."
- Lee Raymond, Exxon's Chairman of the Board, open letter to Congress, May 8, 1997.
"[W]ork with us to resist policies that could strangle economic growth." - Lee Raymond at the October 1997 World Petroleum Congress in Beijing, urging countries of the region to resist climate policies. He further stressed that economic growth "will necessitate increasing, not curtailing, the use of fossil fuels."
ExxonMobil was also a major contributor to a $13 million US advertising campaign against the Kyoto agreement, stating: "It's not global and it won't work." [2]

In 2001, ExxonMobil's hard work seemed to have paid off: President Bush withdrew the USA from the Kyoto agreement. To show their support for the Bush Administration's decision, advertisements were paid for, stating: "Kyoto was too much too soon. Its initial carbon targets would require massive reductions in energy use within a few years, with further substantial reductions to follow. Political goals were set without a sober assessment of economic and technical realities or public toleration of major lifestyle changes. This was reckless given the central role played by energy in all economies." [3]

In its attempts to counter the scientific evidence for climate change, ExxonMobil has used outdated science and misrepresented scientific research. At the shareholder meeting in May 2000, CEO Raymond used satellite measurements of the earth temperature to prove that the world is actually cooling. However this study had already been shown to be incorrect in the scientific journal Nature in 1998, due to the satellite's changed orbital. Taking the changing orbital into account, the data actually shows a warming trend. The new revised data had been publicised in 36 newspapers in the US. At the same AGM, Raymond also referred to temperature measurements in the Saragasso Sea to discredit the climate science. Dr. Lloyd Keigwin, author of the report, later claimed that ExxonMobil's use of his research has been misleading and that no conclusions about the validity of climate change could be made from his research. ExxonMobil has also used the Saragasso example in misleading ads that it placed in the New York Times under the headline 'Unsettled Science'. (At http://www.heatisonline.org/contentserver/objecthandlers/index.cfm?id=3442&method=full the "science" of their ad is taken to pieces.)

For more information on these examples see 'How ExxonMobil is Misleading Shareholders, Policymakers and the Public about Global Warming' (http://www.campaignexxonmobil.org/learn/index.shtml), by CampaignExxonMobil.

ExxonMobil sees no need to invest any of its huge profits into research into renewable energies. This is "[b]ecause they are not as reliable or affordable as conventional fossil fuels, renewables compete in niche applications, and hardly at all in transportation fuels. In view of their technology limits and excess costs, which prevented widespread deployment, a business decision was taken many years ago to concentrate on our core energy and petrochemical businesses." [4] ExxonMobil refers to the US Department of Energy Outlook estimation - that (non-hydro) renewables will only contribute towards 3% of energy needs in 20 years time - as a reason for not even attempting to enter the renewables market. [5] Investment in finding new oil and gas reserves are however still considered a good investment by ExxonMobil. This even though we already have more fossil fuels than we should burn if we are to mitigate climate change. [6]

For the History of ExxonMobil's attempts at to stop any action on climate change, see StopEsso's 'Decade of Dirty Tricks to sabotage The Kyoto Protocol' at http://www.stopesso.com/pdf/Dirty%20Tricks.pdf.

Australia

[7] Near the Great Barrier Reef World Heritage Area, ExxonMobil owns 50% of the Rundle oil shale deposit, through Esso Australia Resources Ltd. (the other half is held by Southern Pacific Petroleum and Central Pacific Minerals (SPP/CPM)). [8] Esso originally planned to commence oil shale mining there (oil shale releases oil when heated and crushed). Greenpeace Australia claims that these developments would have produced open cut mines, potentially created toxic run-off. The final product would have been a very carbon intense fossil fuel. However, in 1983/84 Esso decided not to proceed, officially because the decline in world oil prices made it uneconomic, but Esso still retained its 50% interest.

According to SPP/CPM's 2000 Annual Report Esso has paid all costs on the Rundle deposit from 1 March 1985 and will do so "until construction of the first stage of a commercial development commences." [9] The fact that Esso are willing to cover all costs associated with the Rundle deposit (which amounted to A$12 million in 2000 according to SPP/CPM's 2000 Annual Report) demonstrates a significant degree of interest.

Esso's partners at the Rundle deposit, Australian companies Southern Pacific Petroleum and Central Pacific Minerals (SPP/CPM), are developers of the Stuart Oil Shale Project, just south of the Rundle deposit. Greenpeace Australia is currently campaigning against the development of the Stuart Oil Shale Project.

Europe

In 1998, a proposed EU-wide ban on PVC toys containing phthalates was dropped. Phthalates are used to make PVC toys softer and more elastic, but several reports have raised fears that they could have several detrimental health effects.

Exxon Chemical (producer of phthalates) and Mattel (toy manufacturer) opposed the EU-wide ban. There is evidence suggesting that the US government, lobbying on behalf of Mattel and Exxon, may have influenced the European Commission's rejection of the proposed ban. [10]

Peru

ExxonMobil is preparing to explore for oil and gas in Candamo Valley and the surrounding area (block 78), despite fears that developments could seriously damage the ecosystem and its inhabitants. The area is one of the most biodiverse in the Peruvian Amazon and lies close to the Bahuaja-Sonene National Park. [11]

When Shell explored for oil in the region in 1985, they encountered previously un-contacted Nahua Indians. Soon after 50-100 Nahuas died due to coming into contact with 'western' diseases they had no immune defence against. When in 1996 Mobil was poised to start searching for oil in a neighbouring valley (block 77), an area inhabited by three uncontacted Indian peoples, they were faced with international resistance. In 1998 Mobil decided to withdraw from the land.

Ecuador

Five Indian peoples (the Waorani, Quichua, Siona, Secoya and Cofan) have been affected by the oil exploration of Exxon and other oil companies in the Ecuadorian Amazon. The major negative impacts have been displacement of the wildlife that the Indians depend on and pollution of the soil and water. [12]

Russia

Presently three oilfields at Sakhalin (Sakhalin I, II and III) in the Okhotsk and Bering Seas are being developed. Sakhalin I is run by ExxonMobil, SODECO of Japan, Rosneft and Sakhalinmorneftegas of Russia and Sakhalin III involves ExxonMobil and Texaco. All three developments work under extremely hard conditions. This has lead them to claim that they must discharge toxic wastes in the sea despite international best practice is to re-inject drilling wastes deep underground. This has put half the world's remaining Pacific salmon, pollock and Kamchatka crab under threat. Communities dependant on fishing, including native communities (the Koryak and Itel'men people), have allegedly been silenced through their dependence on the fish quotas of the pro-oil local government. The Sea of Okhotsk and Bering Sea is also important habitat for grey whales, endangered stellar's sea lions and a large variety of seabirds.

In June 1998 the Sakhalin Special Marine Inspection Division (a government agency) filed a lawsuit for the illegal discharge of 3,500 tons of waste into the Okhotsk Sea against the developers of Shakhalin I. The Sakhalin I consortium claimed that the lawsuit was illegal. The matter seems to have been resolved by a letter to the office of V. Danilov-Danilyan, Russian Minister of the Committee on the Environment from K. Kuntz, Director of Exxon Neftegas: "You and I have met twice to discuss this issue and both times you personally assured me that the actions of the Marine Inspection Division are baseless and the suit ought to be recalled." Twelve days later the lawsuit was suspended. [13]

Nigeria

In January '98 a broken Mobil's Idaho production platform leaked 40,000 barrels of oil off the cost of Nigeria. The spill caused a 42-kilometre long oil slick that seriously damaged fishing grounds and farmland. 61 affected communities formed the Association of Mobil Spill Affected Communities to try to get rightful compensation from Mobil. More than one year after the spill the association still didn't feel that the communities had been properly compensated and took direct action occupying 13 pipeline relay facilities in the Niger Delta as well as several barges and boats. [14]

Mobil has also faced pressure from, amongst others, its shareholders through resolutions, over its long involvement in Nigeria. The regime in Nigeria received a substantial amount to its budget through the foreign oil companies operating in the country. [15]

Chad - Cameroon

ExxonMobil is the operator of the '1-billion-barrel' Chad Doba project (ExxonMobil interest 40%). [16] The project would link oil fields in southern Chad to the coast of Cameroon, where the oil would be exported to the west.

There is a lot of controversy surrounding the project. The pipeline would go through fragile rainforest and the traditional homelands of the Baka and Bakola peoples, indigenous communities of hunter-gatherers. [17] The compensation offered to the communities has been minimal, and set without consulting the locals. An environmental impact assessment has been made, but the official Dutch Commission on Environmental Impact Assessments claims that essential information is missing and that from it one could neither asses the project nor its environmental consequences.

The region is also politically highly unstable. Amnesty has documented massacres of unarmed civilians in these regions for over the past two years. A 1999 United States State Department report shows that the Chadian government has engaged in indiscriminate human rights abuses. In March 1998, 100 unarmed civilians were massacred by Chadian security forces in the oil-producing region, just six months after troops killed 80 people in the same area.

Shell and ELF have pulled out of the proposed pipeline. The World Bank, however, is continuing with plans to provide a US$90 million loan to the governments of Chad and Cameroon to help pay for their stake of 15 percent. The International Finance Corporations (IFC), which is the private sector lending arm of the World Bank, is proposing to lend an additional US$150 million toward the project's infrastructure. [18]

Indonesia

ExxonMobil has been sued by the International Labor Rights Fund, on behalf of 11 villagers in Aceh, a province in western Indonesia, where ExxonMobil has a large gas plant. The corporation is accused of being complicit in the human rights abuses committed by the notorious Indonesian army guarding the area.

Villagers in the area have been victims of murder, torture, kidnapping and rape. ExxonMobil's part in these atrocities is claimed to have been supplying barracks used by the military to torture prisoners, and providing machinery like excavators used to dig mass graves. [19]

Mobil began operating the Arun gas fields in 1968 and has since then 'contributed' to the annual budget of Suharto's regime to the time of his downfall. After the merger of Exxon and Mobil, the company took over the management of the gas field. [20]

Colombia

ExxonMobil has a 50% share in an opencast coalmine at El Cerrejon in the north of Colombia through its 100%-owned mining subsidiary Intercor. (Anglo American Coal Corporation Ltd, Billiton plc (based in London) and Glencore International AG (Swiss-based) are other owners of the mine.) [21] The mine is the biggest in South America (30 miles long and two to three miles wide) and produces 15 million tons of coal annually. The area of the mine is inhabited by the Wayuu Indians who have been opposing bad practices at the mine since 1980. At the start 5000 indians were employed but almost all of them were dismissed when the mine started operating two years later. In 1988 the last Indians were made redundant because of trying to organise union activities. [22]

The mine has had negative impacts on the grasslands on which the Wayuu Indians depend. Indians have also suffered from respiratory diseases caused by coal dust, and have endured heavy noise pollution. [23]

Intercor has also shown cultural disrespect by removing Wayuu graves during the construction of a railway connecting the mine and the port of Uribia. Intercor was later forced by the Wayuu to rebuild the structures. [24]

Intercor is now about to evict all residents of the Indigenous community of Tabaco, to make way for the expansion of the mine. Residents are resisting and claim that the relocation arrangements made would break up communities and not give people sufficient funds to buy land to live on. [25]

Workers rights and safety

Esso UK began the process of union derecognition in UK refining and logistics by derecognising its tanker drivers in 1991, followed by process operators at Fawley. The rest of the UK onshore oil industry followed over the next 4 years, to great criticism from the Transport and General Workers' Union. [26] In January 2000, Esso decided to cut many of its middle managers at Fawley [27] - a process known as delayering, widely thought to be the major cause of the recent disastrous safety record of BP's Grangemouth refinery in Scotland.

On September 25 an explosion at the Longford natural gas processing plant occurred killing two workers, injuring eight and cutting off natural gas supplies to most of the state of Victoria for two weeks. In July 2001 Esso was fined £715,000 for safety violations and Justice Philip Cummins, at the supreme court of Victoria in Melbourne, stated that the explosion was not an accident and sole responsibility lay with Esso. The company was convicted last month of 11 charges under the Occupational Health and Safety Act. [28]

Below is part of a list published in The Dirty Four: The Case Against Letting BP Amoco, ExxonMobil, Chevron, and Phillips Petroleum Drill in the Arctic Refuge by Athan Manuel (Published in March 2001 by the US Public Interest Research Group):

  • Exxon paid $252 million as part of a $760 million punitive damage award in August 1998 to Lockheed Corporation workers. The workers sued after being exposed to chemicals while working at the top-secret 'Skunk Works' aircraft plant in Burbank, California. [29]
  • In November 1992 a drilling crew working on an Exxon rig near Hawkins, Texas hit a pocket of natural gas, causing an explosion and well fire. Thirty-one families in the area had to be evacuated. [30]
  • A fire in August 1993 at an Exxon Baton Rouge, Louisiana refinery cooker killed 3 people. [31]

A history of pollution

Below is part of a list also published in The Dirty Four by Athan Manuel. It shows some of Exxon's environmental contributions during the 90s.

Oil Spills, Offshore drilling pollution, and Illegal water pollution

  • Exxon agreed to pay the Texas Natural Resource Conservation Commission $600,000 for dumping almost 2 billion gallons of chemical wastewater from their Baytown, Texas refinery. [32] A recent report on the Baytown refinery in Houston has revealed persistent accidental releases and failure to report problems and emissions.
  • On January 1, 1990, 567,000 gallons of oil spilled from an Exxon pipeline into the Arthur Kill waterway between Staten Island and New Jersey. In February 1990 the City of New York sued Exxon for submitting false pipeline safety reports. Prior to the lawsuit Exxon admitted that its leak detection system had not worked properly for 12 years. A year later Exxon settled out of court, agreeing to spend $10 to $15 million on environmental improvements. [34]
  • Oil that leaked from Exxon's Paulsboro, New Jersey petroleum storage facility has contaminated groundwater and soil in southern New Jersey. [35]

Illegal Air Pollution

  • In February 1998, the Department of Justice filed a civil complaint accusing Exxon of nearly 200 Clean Air Act violations and demanding $4.7 million in fines. [36]
  • In October 1996 Exxon paid a civil penalty of $20,000 for violating the Clean Air Act at its Baton Rouge, Louisiana refinery. [37]
  • In 1993 Exxon paid $1 million in air pollution fines for its Bayway refinery in Linden, New Jersey. The penalties stem from Exxon bypassing air pollution control equipment. [38]

Hazardous Waste Violations

  • In August 1998, Exxon and Tosco agreed to pay $4.8 million in damages and for environmental restoration after discharging selenium, a carcinogen, into San Francisco Bay. [39]
  • In August 1998 Exxon was ordered to pay $35,000 to four plaintiffs as part of the Campbell Wells oilfield waste suit. The residents of Grand Bois, Louisiana sued Exxon and Campbell Wells alleging that the waste exceeded limits on toxins such as benzene, a known carcinogen. [40]
  • In October 1996, Exxon paid a civil penalty of $73,000 for violating the Resource Conservation and Recovery Act and $116,000 for Clean Water Act violations at its Baton Rouge, Louisiana refinery. [41]
  • Exxon is a PRP for 41 hazardous waste Superfund sites in seventeen states.
  • In 1991, EPA fined Exxon $125,000 for discharging contaminated fluids from service stations into or directly above underground drinking water sources. [42]

Stealing oil and gas

Below are examples of ExxonMobil extracting oil and gas without proper permission (list again taken from the excellent report The Dirty Four).

  • In January 2001, the State of Texas filed suit against ExxonMobil for extracting oil and natural gas from state land without permission. The state is seeking "tens of millions of dollars" in compensation.
  • ExxonMobil agreed to pay $7 million to settle claims it underpaid royalties for oil it extracted from federal lands in 2000. It was part of a $282 million agreement reached by 10 oil companies for underpaying the government by hundreds of millions of dollars in drilling royalties on federal land in the western United States. [43]
  • A Montgomery County jury returned a verdict in December 2000, finding that Exxon defrauded Alabama on royalties from natural gas wells in state waters. The jury awarded the state $87.7 million in compensatory damages and $3.42 billion in punitive damages. [44]

Resources

References

  1. ^ February 13, 2001, 'Getting From Here to There: Meeting the Oil and Gas Needs of 2010' Cambridge Energy Research Associates Executive Conference, Remarks by Harry J. Longwell, Senior Vice President, Exxon Mobil Corporation, ExxonMobil website http://www.exxonmobil.com/exec_speeches/hjl_oilandgas.html
  2. ^ Campaign ExxonMobil website http://www.campaignexxonmobil.org/learn/misinform.shtml
  3. ^ http://www.fabclimate.org/company_lowdown_e.html#esso
  4. ^ Global Climate Change, April 2001, ExxonMobil Views, http://www.exxonmobil.com/em_newsrelease/climatetalkingpoints.pdf, viewed 4/9/01
  5. ^ ibid.
  6. ^ For a full outline of this argument see 'Fossil Fuels and Climate Protection - The Carbon Logic' by W.L. Hare, Climate Policy Director, Greenpeace International, available online at http://www.greenpeace.org/~climate/climatecountdown/fossil.htm
  7. ^ This information has been received from Greenpeace Australia, Greenpeace, GPO Box 3307, Sydney NSW 2001, Tel: 02 9263 0321, Fax: 02 9261 4588
  8. ^ Southern Pacific Petroleum, annual report 2000, p.86
  9. ^ Southern Pacific Petroleum, annual report 2000, p.56
  10. ^ 'Out of the Mouths of Babes', by Charlie Cray, Multinational Monitor, June 1998, volume 19, number 6, http://www.essential.org/monitor/mm1998/98june/front2.html
  11. ^ Rainforest Action Network, Action Alert 150, 'ExxonMobil Threatens Pristine Amazon Valley', July 8, 2000 http://www.ran.org
  12. ^ Survival International's Top Ten List, 1992
  13. ^ 'Lawsuit Vs Exxon Pollution In Sakhalin (Russia) Suspended', Drillbits & Tailings, December 21, 1998, p.2
  14. ^ Drillbits & Tailings, April 17, 1999 p.7 (http://www.moles.org/ProjectUnderground/drillbits/990417/99041707.html), Drillbits & Tailings, September 21, 1998, p.2
  15. ^ http://www.moles.org/ProjectUnderground/drillbits/980421/98042101.html, Drillbits & Tailings, April 21, 1998, p.1 , 'Mobil Shareholders Take On Human Rights Issues'
  16. ^ Annual report 2000, p.12
  17. ^ 'Drilling to the Ends of the Earth,' Project Underground report, July 1998, and 'Help Stop World Bank Loan to Exxon for Chad-Cameroon Pipeline,' Friends of the Earth and Environmental Defense Fund fact sheet.
  18. ^ 'Shell and ELF Pull out of Chad-Cameroon Pipeline', Drillbits & Tailings, Volume 4, Number 19, 23/11/99. 'Activists Demand World Bank Axe Chad-Cameroon Oil Project', Drillbits & Tailings, 21/7/98.
  19. ^ 'Lawsuit Says Exxon Aided Rights Abuses', Neela Banerjee, New York Times June 21, 2001
  20. ^ Drillbits & Tailings, December 21, 1998, 'Mobil Operations in Sumatra (Indonesia) Investigated As Villagers Sue'
  21. ^ AME Mineral Economics website (economic analysis of metal and minerals) http://www.ame.com.au/mines/co/Cerrejon-Norte.htm, viewed 28/08/01
  22. ^ Drillbits & Tailings, March 21, 1998, p.3, 'Abuses Revealed In Venezuelan Coal Sector' http://www.moles.org/ProjectUnderground/drillbits/980321/98032103.html
  23. ^ Survival International's Top Ten List, England 1992
  24. ^ 'What You Should Know about the Proposed Crandon Mine', Compiled by Al Gedicks, Exec. Secretary, Wisconsin Resources Protection Council http://www.wrpc.net/wyskcul.html, viewed 28/09/01
  25. ^ From Mines and Communities homepage http://www.minesandcommunities.org/Action/action9.htm, viewed 28/08/01
  26. ^ The Herald, 14/4/98, 'Unions condemn findings of low-pay survey in run-up to minimum wage', by Ken Smith
  27. ^ Hart's European Fuel News, 12/1/00, 'Further streamlining at Fawley'
  28. ^ 'Esso fined over fatal gas plant explosion', Monday July 30, 2001, The Guardian
  29. ^ Michael Fitzpatrick, 'California Jury Awards $760 Million Against Exxon, Others,' Reuters Limited, August 8, 1998.
  30. ^ ibid.
  31. ^ Doyle, 'Crude Awakening', Table 14-2; Oil, Chemical, and Atomic Workers International; Chemical Week, and other sources.
  32. ^ 'Texas Enviro. Group Sues Exxon Over Wastewater,' Wall Street Journal, March 15, 1996
  33. ^ Patrick Lee, 'Toxics Disposal Probe Targets Exxon, Arco, BP,' Los Angeles Times, Feb. 20, 1991, p.D-1
  34. ^ Leonard Butler 'New York City Accuses Exxon of Fraud in Spill,' New York Times, February 8, 1990 p.B-2, and 'New York City Sues Exxon Over Oil Spill in January,' Wall Street Journal, February 8, 1990
  35. ^ NJ Dept. of Env. Protection and Energy, Site Remediation Program – Site Status Report. Lance R. Miller, Assistant Commissioner, Fall 1991, p.224
  36. ^ 'DOJ Sues Exxon for Clean Air Violations,' Greenwire/National Journal Group, February 13, 1998.
  37. ^ FY 1997 EPA Enforcement and Compliance Assurance Accomplishment Report, B-39
  38. ^ 'Exxon to Pay Pollution Fines on Refinery It Sold,' Associated Press, Apr. 10, 1993.
  39. ^ 'Oil Refineries Settle Over Selenium,' Contra Costa Times, August 26, 1998.
  40. ^ 'New Rules on Oilfield Wastes Expected After Tests Finished,' Saturday State Times/Morning Advocate, August 31, 1998.
  41. ^ FY 1997 EPA Enforcement and Compliance Assurance Accomplishment Report, B-39
  42. ^ FY 91 EPA Enforcement and Compliance Assurance Accomplishments Report
  43. ^ http://cnniw.yellowbrix.com/pages/cnniw/Story.nsp?story_id=17255174&ID=cnniw
  44. ^ http://www.msnbc.com/local/wvtm/229470.asp
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