Is Chevron lying about its crude plans?

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Activists demonstrated outside the court hearing.

By Adam Lesser

William Rostov, the Earthjustice lawyer who represents three Bay Area environmental groups, broke it down: “The question is: will it be heavier and will that result in more pollution?” He was speaking about crude oil refining at Chevron’s Richmond refinery as he addressed California’s First Appellate Court in San Francisco this morning. Heavier crude oil is usually less expensive for oil companies to purchase but generates more pollution during the refining process.

Environmentalists, labor unions, lawyers and Chevron representatives packed the courtroom to hear opposing counsel spar over the project’s environmental impact report, which was invalidated by a Contra Costa Superior Court judge last June. The ruling stopped the refinery expansion that Richmond has approved.

Chevron attorney Ronald Van Buskirk hammered the point that “the project didn’t propose a crude switch.” When pressed on why Chevron declined to disclose the data behind the conclusion that there would be no switch to heavier grade crude, Van Buskirk countered that the data constituted “trade secrets” that are protected under law.

Rostov argued that “refinery experts showed this project allows the use of heavier crude” and that Chevron “misled the public” in its EIR. A key component of the environmentalists’ argument rests on the 2007 Chevron annual report to the U.S. Securities and Exchange Commission, which specifies that “design and engineering for a project to increase the flexibility to process lower API-gravity crude oils at the company’s Richmond, California, refinery continued in 2007.” API gravity is a measure of how heavy or light petroleum is. Lower API gravity corresponds to a heavier crude oil. But Van Buskirk countered that the plaintiff’s evidence amounted to “one sentence in a 10K report.”

Justice Patricia Sepulveda questioned Van Buskirk about whether the $61 million Community Benefits Agreement that Chevron offered to contribute to the city of Richmond gave the city “bias to approve the project.” But Van Buskirk said, “It wasn’t a quid pro quo, if that’s what you’re suggesting,” before ultimately conceding that it was fair suggest to that the gift had played a role in the approval.

Judge Ignacio Ruvolo presided over Chevron’s appeal. At the end of oral arguments, he spoke to the efforts the court has taken to expedite the case, pressing attorneys on whether there was any chance of a settlement.

“The parties are still very far apart,” said Van Buskirk, and Rostov nodded the same. For the first time all morning, everyone was in agreement.

The court will rule within 90 days.