Chevron's Chickens Come Home to Roost in Canada
On May 30, the Ecuadorian plaintiff's Canadian lawyer, Alan Lenczner, filed suit in Ontario Superior Court in Toronto against Chevron and its two wholly-owned Canadian subsidiaries, Chevron Canada Ltd. and Chevron Finance Canada Ltd. The suit asked the court to recognize the Ecuadorian judgment and, through the appointment of a special receiver, use the shares and assets of the Canadian subsidiaries to satisfy the judgment.
The Ecuadorians filed a similar lawsuit in Brazil on June 29, and they are expected to file similar actions in other nations over the coming months. The net result is an unprecedented global campaign to end Chevron's impunity for its environmental crimes.
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Chevron's Exposure to Collection in Canada
Chevron has substantial assets in Canada that would be subject to seizure if Ontario courts recognize the Ecuadorian judgment. These assets include operations in Alberta's tar sands, offshore Newfoundland, and the Burnaby refinery in British Columbia. However, the seizure of these assets would not cause any significant disruption of oil operations or production.
Chevron began operating in Canada more than 70 years ago, and its subsidiaries include Chevron Canada Resources and Chevron Canada Ltd. The company's Canadian holdings include a 20 percent working interest in the Athabasca Oil Sands Project (AOSP) in northern Alberta. Chevron is also developing natural gas from shale acreage in the province.
Most of Chevron's crude oil production in Canada comes from the Hibernia Field off the east coast of Newfoundland and Labrador, where the company holds a 26.9 percent interest. In British Columbia, Chevron owns and operates the Burnaby Refinery. The company also owns 162 service stations, 134 convenience stores, and 21 fast-food restaurants and is the province's top seller of transportation fuel. Chevron holds two exploration licenses in the Beaufort Sea region of Canada's western Arctic.
In 2011, total daily production from Chevron's Canadian operations was 197,000 barrels of crude oil, 28 million cubic feet of natural gas, and 210,000 barrels of synthetic oil from the oil sands.
Understanding the Law
This case is important for Canada as it aligns with the country's long-standing tradition of recognizing legitimate foreign judgments as well as upholding an unwavering respect for the rule of law. Canadian courts are seen as some of the most impartial anywhere in the world and Canadian judgments, which is what the Ecuador lawsuit will become if and once recognized in Canada, are given great deference in other nations.
In addition, the values represented by this case – namely respect for the environment and indigenous rights – are deeply cherished by Canadians and are reflected in hundreds of judgments across the country right up to the Supreme Court. Canadians will not take lightly to Chevron's trashing of these values in Ecuador and are not a nation to sit idly by as this oil giant becomes a fugitive from justice over the well-fought attempts to hold it to account.
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