Iraqi oil enters S.F. Bay

By George Schulz

Six months after it was an antiwar epicenter, the San Francisco Bay Area is developing a closer relationship with occupied Iraq, as ChevronTexaco Corp. reportedly delivers shipments of Iraqi crude oil to its Richmond refinery.

Two postwar contracts were awarded to San Ramon-based ChevronTexaco in June and July. Company spokesperson Bonnie Chaikind told the Bay Guardian a contract for oil purchases would extend from August to the end of December. Beyond that, ChevronTexaco is tight-lipped about details, like whether the oil would at any time enter the Bay Area or be refined at the Richmond plant.

"We tend not to go into specific details about things such as that," Chaikind said. "We don't discuss where our fleet is, and we view this solely as a security issue."

But activist groups including Direct Action to Stop the War say that at least one oil tanker has arrived in the Bay Area, and more shipments are scheduled. Reuters reported in July that ChevronTexaco is a big user of Iraqi oil for its West Coast refineries and that somewhere between two and four million barrels had been confirmed in purchases by the company. Citing oil industry publications and research, David Solnit of DASW said Iraqi oil is entering the bay on its way to Richmond, one of two West Coast ChevronTexaco refineries.

"The striking thing about the oil is the countries that supported the war are getting the bulk of it, namely the U.S. and Britain," Solnit said.

Quoting a DASW researcher, Solnit stated in an e-mail that Chevron had imported 2.1 million barrels of Iraqi oil to its Richmond refinery in February of this year and that "it's reasonable to expect that type of volume (up to a couple million barrels per month) to resume."

Chaikind refused to state how much the deals might be worth to ChevronTexaco, saying that such an answer would be "speculative" and could compromise the company's competitiveness. She did say that under the United Nations' Oil-for-Food program (dropped along with economic sanctions in May), Iraq provided for about 2 to 3 percent of the company's total crude trading.

Iraq's Ministry of Oil, overseen by U.S. administrators, is handling the sale of the oil, with revenues slated to enter a U.N.-created Development Fund for the beleaguered country. But Pratap Chatterjee of CorpWatch said the money will likely be sloshed around from one U.S. corporation to another. He believes money from the Development Fund will go toward reconstruction projects contracted by politically connected companies such as Halliburton.

"I don't think it's too much to call this a fancy money-laundering scheme," Gopal Dayaneni, a longtime anti-ChevronTexaco campaigner and organizer for the Design Action Collective, said.

International ANSWER's Bill Hackwell said the people of Iraq should determine the fate of the country's oil and postwar reconstruction efforts without the intrusion of authorities handpicked by the United States. Based on the development money's resemblance to a slush fund, Dayaneni questioned whether the Iraqi people would ever be able to democratically exercise control over their own resources.

"What's disturbing is that while this oil is owned by the Iraqi people and therefore sold in their interests, every step of the way the people making and moving the money are transnational corporations," Dayaneni said.

This isn't the only time the conflict has been profitable for ChevronTexaco. Net income for the company in the first quarter of 2003 was $1.9 billion, up $1.2 billion from the same period the previous year, according to the company's most recent earnings report. The report partly attributes the higher earnings to "geopolitical uncertainty in Iraq and Venezuela."

Chaikind insisted ChevronTexaco "fully supports the goals of the United Nations to return oil revenue to the people of Iraq, and we consider that a part of rebuilding Iraq." In the meantime, she said, the company will continue to do business in the country as long as it makes economic sense.

Ensuring that business in Iraq "makes sense" seemed to be President George W. Bush's intention with May's Executive Order 13303, which states that "any attachment, judgment, decree, lien, execution, garnishment, or other judicial process is prohibited, and shall be deemed null and void with respect to the Development Fund for Iraq and all Iraqi petroleum and petroleum products, and interest therein."

Presumably that means oil producers are less likely to be punished for environmental accidents or human rights violations extending from the production and transport of the oil – at least as long as any sort of legal measures are "prohibited." The order could also potentially curb attempts to challenge U.S. control and distribution of the oil before an American or international court.

The order highlights Bush's eagerness to secure a safe environment in Iraq for foreign investors, and whether anyone will try to challenge the authority of the order in court has yet to be seen. Judicial pundit Andrew Napolitano told Fox News in August that the courts or Congress could be in a position to check the order's sweeping implications.

Action alert Tell ChevronTexaco to take the oil elsewhere Tues/9, 5:30 p.m., Point Richmond, Cutting Blvd. and S. Garrard Blvd., Richmond. For more information go to Direct Action to Stop the War's Web site at www.actagainstwar.org.