Pro-pollution partisanship shown by the Economist magazine

"Oil, Ecuador and The Economist: A volcano erupts; Rafael Correa lambasts us and 'the empire of capital'"
2013-10-12 from "The Economist" newsmagazine [http://www.economist.com/news/americas/21587825-rafael-correa-lambasts-us-and-empire-capital-volcano-erupts]:
LAST month we published a story about the decision of Ecuador’s president, Rafael Correa, to authorise drilling for oil in the Yasuní National Park in the Amazon rainforest (“It’s hard to be green,” September 28th [http://www.economist.com/news/americas/21586825-correa-gets-away-u-turn-its-hard-be-green]), an idea he had previously resisted. We explained the reasons why he changed his mind—that Ecuador has no easy alternatives to boost oil production and that Mr Correa needs more money to continue his anti-poverty programmes.
Then we added: [begin excerpt] In a bid to deflect the anger of environmentalists at his U-turn, Mr Correa this month turned his rhetorical fire on Chevron. Two years ago, an Ecuadorean court in Lago Agrio, an Amazon town, imposed a colossal $19 billion fine on the company over pollution allegedly caused in the 1970s and 1980s by Texaco, bought by Chevron in 2001. In fact Ecuador’s government reached a final settlement with Texaco in 1998 (the tar pit into which Mr Correa dipped his hand earlier this month is the responsibility of Petroecuador, a state company). [end excerpt]
Mr Correa himself blamed Chevron for the tar pit he visited, saying last month: “These are pools left in 1986 by Texaco, which were never operated by other companies, and today, nearly 30 years later, what comes out is oil.”
Our article prompted an extraordinary response from Mr Correa. On October 5th he accused us of “barefaced lies” and of acting on behalf of Chevron, which he said “has financed campaigns in The Economist”. “None of this is coincidental, it’s the empire of capital,” he explained, adding: “The whole of humanity should rebel against this. Two powerful foreign families, the Rothschilds and Schroders, are shareholders of The Economist group and of six financial companies that are in turn shareholders in Chevron.” He called for a Twitter campaign against us.
Like many paranoid fantasists (or politicians seeking a smokescreen for a climb-down), Mr Correa has got some things half-right. Chevron is a frequent advertiser in The Economist and in 2007 it hired our sister company, the Economist Intelligence Unit, to provide data for an online energy-policy simulation (see www.energyville.com). The Rothschilds and Schroders are indeed minority shareholders in The Economist group (we are sorry that Mr Correa finds “foreigners” so sinister).
But we have no idea if they are also shareholders in Chevron and don’t care. They have no influence over our coverage of this subject or any other. Our reporting is based on a commodity that seems to be lacking in Mr Correa’s mental universe: facts. He may not like the fact that a previous, elected Ecuadorean government settled in full the claims against Texaco, but it did. Contrary to the contention of Ecuador’s ambassador to London (see article), an international tribunal in The Hague recently ruled, in a case brought by Chevron, that class-action suits of the kind initiated against the firm in Lago Agrio were precluded by that earlier settlement.
As for that tar pit: a plan drawn up in 1995 specified the share of remediation work that Texaco was supposed to perform. The pool into which Mr Correa dipped his hand, known as Aguarico-4, is not one that the company was required to clean up. Petroecuador’s own corporate documents suggest a long-standing interest in Aguarico-4. Its statistical report of 2007 lists Aguarico-4 as a “production recovery” site; its 2011 report refers to “reconditioning work” going on at the pool.
That seems to confirm that Petroecuador has for some time regarded Aguarico-4 as its responsibility. It also seems to deny Mr Correa’s claim that the site has been neglected since 1986. Perhaps Mr Correa should tell all of humanity about that.


"Oil in Ecuador: It’s hard to be green; Correa gets away with a U-turn" 
2013-09-28 from "The Economist" newsmagazine [http://www.economist.com/news/americas/21586825-correa-gets-away-u-turn-its-hard-be-green]:
THE Yasuní National Park in Ecuador’s slice of the Amazon contains countless endangered species of animals and birds. For that reason Rafael Correa, the country’s president, hatched a scheme under which he would forebear from extracting the oil that lies beneath the park’s northeastern corner, if the rest of the world put up $3.6 billion, or half its estimated value. The world spurned this offer and last month Mr Correa cancelled it, saying that the estimated 840m barrels of oil in the area, which he now values at $18 billion, would help him to continue to cut poverty.
The area in the Yasuní park where the oil lies, known as Ishpingo-Tambococha-Tiputini (ITT), contains such endangered species as the giant otter and the freshwater manatee. Until it changed its mind, the government used to say that it was also home to small groups of uncontacted Amerindians. Mr Correa now says that drilling will affect only 0.01% of the park.
The ITT field will be given to Petroamazonas, a state company, which pledges to minimise disruption to the environment. Laying pipelines and digging hundreds of wells will be no more painful than pricking a baby for a vaccine, according to government advertisements. To raise the capital required to exploit ITT, Petroamazonas is likely to bring in Chinese oil companies.
Mr Correa is popular, thanks to an economic boom engineered by higher public spending, paid for by raising oil royalties and Chinese loans. Although oil output is at record levels, consumption is rising and reserves are being fast depleted. New production contracts have driven away multinationals and discouraged exploration, industry analysts say. The oil ministry has twice extended a tender for an area south of the Yasuní because no companies bid.
There are two alternatives to drilling in the Yasuní. One would be to welcome foreign investment in other industries. But the president is not keen on that. The other would be to redouble efforts to develop Pungarayacu, a big field of heavy oil. But that would also annoy greens.
Polls suggest that Ecuadoreans are evenly split about developing the ITT field. The Waorani Indians, a few of whom live there, initially protested against Mr Correa’s decision, but have been placated by offers of money for health care and schools. The opposition wants a referendum on the issue.
If one were held, Mr Correa might win it. He is a formidable campaigner. In a bid to deflect the anger of environmentalists at his U-turn, Mr Correa this month turned his rhetorical fire on Chevron. Two years ago, an Ecuadorean court in Lago Agrio, an Amazon town, imposed a colossal $19 billion fine on the company over pollution allegedly caused in the 1970s and 1980s by Texaco, bought by Chevron in 2001. In fact, Ecuador’s government reached a final settlement with Texaco in 1998 (the tar pit into which Mr Correa dipped his hand earlier this month is the responsibility of Petroecuador, a state company).
Chevron accuses the Ecuadorean court of fraud and the lawyers who sued it of racketeering. An international arbitration panel sitting in The Hague under United Nations rules has told Ecuador to stop trying to collect the damages. The government says it will not obey. If Petroamazonas and Mr Correa’s Chinese friends mess up the Yasuní, the president will find it harder to come up with a scapegoat.