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International oil deals include additional risk

Power Play: An ongoing trial between Chevron and environmental groups in Ecuador highlights the challenges of American oil companies doing business overseas.
by Adam Wilmoth Modified: September 27, 2013 at 8:00 pm •  Published: September 26, 2013
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Few Oklahoma oil and gas producers do business overseas.

Part of the reason is there are so many opportunities domestically.

But that's not the only reason for the local focus.

There also are many headaches involved in working with foreign governments, especially for an oil and natural gas producer.

An ongoing trial between Chevron and environmental groups in Ecuador highlights the challenges of American oil companies doing business overseas.

Chevron inherited its Ecuador problem when it bought Texaco in 2001. The issue centers on claims of pollution in Ecuador from a series of Texaco oil wells.

Texaco settled with Ecuador, agreeing to spend about $40 million for cleanup.

But the lawsuit later became a class-action case involving about 30,000 people who claimed environmental injury. A court-appointed independent expert said there were ongoing environmental problems with at least two former Texaco well sites.

The court ruled against Chevron, ordering the company to pay a record $19 billion in fines and restitution.

It was later shown that the expert was paid by the environmental group bringing the suit and that the opinion was written by the group, not the expert.

That information became public because the environmental group paid a video crew to document the process. The “behind-the-scenes” footage later became evidence.

“In some of the other outtakes, the lawyer talks about plans to scare the judge and to confront the judge,” said Mark Walker, an attorney at Crowe and Dunlevy in Oklahoma City. “He said this is something you would never see in the United States. This is out-of-bounds behavior that lawyers would not do. But in Ecuador, there are almost no rules.”

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by Adam Wilmoth
Energy Editor
Adam Wilmoth returned to The Oklahoman as energy editor in 2012 after working for four years in public relations. He previously spent seven years as a business reporter at The Oklahoman, including five years covering the state's energy sector....
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