* Indigenous farmers say $8.6 bln in damages not enough
* Plaintiffs lawyers say will appeal to ask for more
* Chevron calls verdict 'illegitimate,' denies all charges
By Victor Gomez
LAGO AGRIO, Ecuador, Feb 15 Ecuadorean farmers
who accuse Chevron Corp of polluting the Amazon jungle are
happy the U.S. oil giant was found guilty after a 17-year legal
battle, but they say the $8.6 billion award is not enough.
In this hot and oil-rich region dotted with small
subsistence farms, the days ahead will be marked by meetings
with residents and their representatives to decide the details
of their appeal of the damages amount named by the court.
"It's not fair to us because the tribes have suffered a
lot," plaintiff Justino Piaguaje said of Monday's ruling by
Sucumbios provincial court in the heart of Ecuador's Amazon.
A farmer, Piaguaje is a member of the Secoya indigenous
group, which says there is a higher incidence of cancer in the
Rhode-Island sized area and water supplies are polluted with
"Our families have died, and our rivers have deteriorated,"
Piaguaje said. "But over and above the amount in damages, we
believe that Chevron has been sanctioned. This is a hard blow
to Chevron and an important step for the indigenous people of
The plaintiffs had been hoping for at least $27 billion,
and their lead lawyer, Pablo Fajardo, said they will appeal the
$8.6 billion damages figure later this week in Sucumbios court.
"We still do not know exactly what the content (of the
appeal) will be," Fajardo said. "We are still studying the
Chevron (CVX.N), which made $19 billion in net profit last
year, is vowing to fight the lawsuit, which it says is riddled
with fraud on part of the plaintiffs and their lawyers.
It denies any health problems in the region are its fault
and says it cleaned up any pollution for which it was
responsible. The San Ramon, California-based company has no
assets in Ecuador and believes it is unlikely ever to pay.
Chevron shares rose 1.3 percent on Monday on higher oil
prices as investors shrugged off news of the court ruling.
Analysts said a final verdict in the case was probably years
away. The stock dipped less than 1 percent on Tuesday.
Still, investors and the oil industry believe the Ecuador
case could set a precedent leading to other large claims
against companies around the world that have been accused of
contaminating countries where they operate.
San Francisco-based Amazon Watch called the ruling
"It is the first time that indigenous people have sued a
multinational corporation in the country where the crime was
committed and won," the environmental group said.
Nicolas Zambrano, a judge of a provincial court in the
jungle town of Lago Agrio at the heart of the case, said in his
ruling that Chevron must apologize within 15 days for the
contamination from oil wells dug decades ago, or face a
doubling of the damages figure.
Full coverage of case [ID:nN14]
Reuters Insider link.reuters.com/vaw55n
'OIL IN THE RIVERS'
Piaguaje's farm, in an area called Shushufindi, produces
yucca and corn for his family to eat as well as cocoa, which he
sells in the local market.
He and other plaintiffs say that Texaco, which Chevron
bought in 2001, polluted their Amazon lands and water with
faulty drilling practices in the 1970s and 1980s.
"The amount in damages included in the judge's ruling are
really minimal," said Ermes Chavez, president of the local
environmental group Amazon Defense Front. "The damage cannot be
repaired with this amount of money."
He was not alone in complaining about the award.
"It seems very little, considering that the whole eastern
part of the country is contaminated," said Julio Jaramillo,
another plaintiff. "How many people have died of cancer? The
gringos pumped oil into the rivers without giving it a second
The first level of appeal available to Chevron is the full
provincial court in Sucumbios province, which has three judges.
If that panel upholds the ruling, the company's next stop would
be Ecuador's Supreme Court.
Texaco struck oil in Ecuador in 1967 and started pumping in
1972 as part of a consortium with the state. The company
operated in Ecuador until 1990. Soon after, it turned its share
of the consortium over to the Ecuadorean government.
State oil company Petroecuador has continued drilling in
the area over the 20 years since Texaco pulled out.
Chevron says it cleaned up all the drilling waste pits that
it was legally required to. Regardless of who is responsible,
the dirt just under the surface around some former pits still
has a black sheen and carries the eye-watering stench of oil.
Farmers say they cannot raise crops or livestock in these
areas because of the contamination.
(Additional reporting by Hugh Bronstein, Alexandra Valencia
and Santiago Silva, Writing by Hugh Bronstein; Editing by Frank
Jack Daniel and Kieran Murray)