Chevron facing $9.5 billion penalty for oil contamination in Amazon

Nov. 18, 2013

The penalty that Chevron Corporation will have to pay in the case concerning oil contamination in the Amazon has been cut by half by Ecuador’s highest court, which upheld the verdict but reduced the fine to $9.5 billion.

The penalty that Chevron Corp. will have to pay in the case concerning oil contamination in the Amazon has been cut by half by Ecuador's highest court, which upheld the verdict but reduced the fine to $9.5 billion, Reuters reported.

This was the sum included in the original judgment against the oil company, awarded in February 2011. However, a year later the amount was doubled following Chevron's refusal to publicly apologize and take all responsibility for the contamination of local areas between the 1960s and the 1990s. At that time, a Texaco-led consortium operated in the region. Texaco was later acquired by Chevron, which also inherited the legal responsibility.

RELATED: Latin American refining sector struggling to capitalize on growing oil output

The latest ruling by the National Court of Justice on Tuesday stated that the doubling of a civil award for environmental damage was not justified under Ecuador's laws and Chevron will have to pay only the original damages imposed, Reuters said.

Meanwhile, Chevron has refused to pay anything to the plaintiffs in the case, claiming that they have been involved in fraud. The case has gone through appeals and arbitration panels across three continents. According to James Craig, spokesman for Chevron, the ruling against the company was "illegitimate and inapplicable." The National Court of Justice should have declared the trial void, he stated.

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