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Argentine court refuses to enforce $9.5bn Ecuadorian judgment against Chevron

EBR Staff Writer Published 03 November 2017

Chevron has got a favorable judgment in Argentina pertaining to the $9.5bn Ecuadorian oil pollution case after a court ruled that the company’s Argentine subsidiary cannot be made liable for a judgment against the parent firm.

The National Civil Court No. 61 in Buenos Aires said that it doesn’t have jurisdiction over Chevron as it has no assets in Argentina and the defendant has no point of connection with the country.

The US-based energy firm operates in Argentina through its subsidiary Chevron Argentina which has been found by the court to be not a party to the Ecuadorian lawsuit.

The latest judgment comes as a setback to Ecuadorean citizens who were looking to enforce the Ecuadorean court’s judgment against Chevron in Argentina.

Chevron vice president and general counsel R. Hewitt Pate said: “Once again, attempts to profit from this fraudulent judgment have been rejected.

“We are confident that any jurisdiction that observes the rule of law and examines the facts will similarly find the Ecuadorian judgment to be illegitimate and unenforceable.”

In June, the company got a favorable ruling in the US Supreme Court which prevents it from paying the $9.5bn compensation on charges of being responsible for an oil pollution incident in Ecuador.

The oil pollution case is related to Texaco Petroleum (TexPet) and dates back to the early 90s. In 2001, TexPet was acquired in 2001 by Chevron, thereby dragging the latter in the case.

TexPet’s consortium between 1964 and 1992 with Petroecuador, the Ecuadorian state-owned oil company was accused of causing environmental pollution due to their operations in the Lago Agrio oil field.

In 1992, TexPet transferred its stake of the oil operations to Petroecuador pursuant to government condition that it should take care of a remediation work of certain sites while the state-owned company was to take responsibility of any remaining cleanup.

As per Chevron, TexPet finished its remediation work and was cleared by the Ecuador government from any additional environmental liability. However, the US firm says that Petroecuador did not complete the promised cleanup which led to a class action lawsuit from Ecuadorian villagers against Chevron in 2003.

Image: Oil pollution in Lago Agrio as pictured in 2007. Photo: courtesy of Julien Gomba/Wikipedia.org.