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Workers try to contain an oil spillage in the Cuyabenco Chico river where 600 oil barrels were spilt in 2006. - 


JEREMY HOBSON: A judge in Ecuador has ordered U.S. oil giant Chevron to pay $9.5 billion for contaminating rainforests and rivers there.

Let's get the latest now from our Marketplace Sustainability Desk reporter Eve Troeh. Good morning Eve.

EVE TROEH: Hi Jeremy.

HOBSON: So give us some background here -- why is Chevron being punished?

TROEH: Well this case has been going on for 17 years. Villagers in northern Ecuador sued Texaco, actually, for pollution in the 90s. They said decades of oil drilling and refining made them sick, and ruined their land and water. When Chevron bought Texaco in 2001, the case was still unresolved.

I spoke this morning with Nick McGregor. He's an oil analyst with Redmayne-Bentley. And he says if the ruling holds up, Chevron definitely owes Texaco's bill. He also said any settlement in Ecuador would be historic.

NICK MCGREGOR: Not that many years ago if you spilt oil in the developed world -- yes, it would cost you a lot of money. And if you spilt oil in more remote parts of the world, you know you just walked away from it, or bummed someone a few dollars to keep quiet and left it.

HOBSON: And Eve what is Chevron saying? What's their argument?

TROEH: Well Chevron does plan to appeal. It's been collecting evidence for years -- with pen microphones and other spy tactics -- that there was corruption in the case. A U.S. district court judge said he'd move to block enforcement of the ruling. As did the international court, the Hague. But the judge in Ecuador says if Chevron doesn't agree to pay in 15 days he's going to double the settlement to $19 billion.

HOBSON: Marketplace's Eve Troeh from our Sustainability desk, thanks Eve.

TROEH: Thanks.


STEVE CHIOTAKIS: A judge in Ecuador has ordered American oil giant Chevron to pay $9.5 billion for contamination of rain forests and rivers there. Villagers in northern Ecuador sued Texaco 17 years ago. Back in 2001, Chevron bought Texaco. And as a result, it inherited the case.

Oil analyst Nick McGregor with Redmayne-Bentley says the ruling sends a message that big oil companies will be held accountable in poor countries.

NICK MCGREGOR: There are no safe jurisdictions in which to polute. In every jurisdiction in which they opporate they'll have to operate under their best practice in order to try and avoid things like this.

But the case isn't near over. Chevron plans to appeal, saying there's evidence of corruption. And a U.S. district court judge in California, where Chevron is based, says he won't enforce the ruling from the court in Ecuador.

Follow Eve Troeh at @evetroeh