Article published 7 September 2007: Shell to appeal refinery closure
Shell CAPSA will appeal an order issued late Wednesday night that will lead to the closure of its refinery in the Dock Sud area for alleged pollution, company president Juan José Aranguren announced yesterday.
By Peter Johnson
The closure, the latest in a series of clashes with the government over the pricing of the company’s fuels and alleged failures to meet the requirements of the so-called Supply Law, will take at least a week and “is the first time that the refinery has been shut down since 1977, or at least since I have been with the company,” Aranguren stated.
“We are in the process of sending out certified letters to our 700 service stations declaring a force majeure,” Aranguren told a a press conference.
The executive refuted the reasons given for the refinery closure, the principal one being that the company was using some 14.5 million litres of water from the Dock Sud Canal, arguably part of the Matanza-Riachuelo basin, water that could be used by the approximately 1.1 million people that live in the area.
“The water is black (with pollution) and is only used for refrigeration in the refining process. After being used it is filtered and pumped back into the River Plate in a much cleaner condition than when it entered the refinery,” Aranguren stated.
Further article dated 7 September 2007: (Possibly the editorial “Shell Shock”)
One of the points used for the government-ordered shutdown was that the company did not have a permit to use the water, yet Aranguren pointed out that the only law in this area applies to the use of underground waters.
A second reason given for the shutdown was the lack of inspection certificates for equipment working under pressure. Aranguren said that due to the complexity of inspecting this equipment in a working refinery, the company had reached an agreement with the provincial environmental authorities to carry out the inspections over a 10-year period and that some 400 of these items of equipment had already been inspected.
The third argument given was the oil “stains and spills” at the refinery. This was refuted by the executive who said that “the refinery covers 120 hectares and the spills and stains detected did not cover more than 120 square metres.
Independent testing of samples extracted from the spill sites where the inspectors had taken theirs showed only superficial contamination.”
The inspectors that ordered the closure had also found “deficient management of special residues” in reference to waste rags that are stored around the site in special drums for removal to a central processing site.
The authorities also argued that the refinery did not have an environmental impact study, “which is untrue as the company has to submit an environmental impact certificate every two years which is largely based on an environmental impact study.”
At a time when all the refineries in the country are operating at full capacity to meet demand, Aranguren wondered how the other companies would be able to meet the sudden shortfall in supply. Shell currently has around 12 percent of the diesel market and close to 19 percent of the petrol market. Aranguren estimated that service stations served by Shell had between three and four days of stocks.
The executive pointed out that if the shutdown process at the refinery continues “it will take 10 days before it can be got back on line again.”
“The shutdown is a delicate process and if not done correctly it could be impossible to start up again,” he pointed out.
However Aranguren was adamant that “environmental risk was not the reason for the closure.”
Asked whether he considered that the company was being discriminated against by the government, the executive said that there was a difference of opinion with the Domestic Trade Secretary but that it “is our job to operate the company and not speculate about witchhunts.”
However, he considered that with the Supreme Court ruling last year to clean up the Matanza Riachuelo basin, the closure may be a government strategy to show that it is doing something.
The refinery is one of only two in the world to have obtained the ISO 14001 environmental compliance standard.
On other sector issues the executive considered that none of the current fuel retailers in Argentina are in a position to buy Esso’s assets here — reportedly on sale — as they would probably have to deal with competition issues.
Letter to the Editor from J.D. Taillant, Fundación Centro de Derechos Humanos y Ambiente (CEDHA): Saturday, September 22, 2007
Your view (Letters)
Defending the indefensible
The defence of the indefensible arises in the editorial (Shell-shock, September 7) which criticizes the closure of the Shell plant and describes it as arbitrary, defending the multinational corporation against an alleged attempt to hand it over to Hugo Chávez, a conspiracy theory which prompts some comment.
First, Shell was polluting the environment, and was caught out by inspectors from the Environment Secretariat. In addition permits to operate the installations were not available. There were serious problems with handling toxic waste. That is illegal. It is irrelevant how other refineries and oil companies stand by comparison, and by the way several were closed or cautioned. It was not a technology problem, as the editorial says. Neither was it a case of a few boilers operating without permits, and some not even declared, there were over 700. A company like Shell declares in its website with very attractive rhetoric that it cares for the environment, but it must obey the law. What happened? Did they forget that issue? And the Herald defends them?
The argument suggested that Shell perhaps contaminates but the Riachuelo is already polluted is the attitude of the more than one thousand industries to blame for polluting the river. That attitude gets us nowhere.
The Herald ends by criticizing the government’s alleged abuse of the magnitude of the problem and the “future of humanity.”
The violation of the law and the abuse is committed by Shell, not the Environment Secretariat. Instead of fretting about what the investors might say of this dump where they can do as they wish and behave as they would not in their own countries, we should be announcing the end of tolerance of pollution in Argentina. And ignore the conspiracy theory and the defence of the indefensible.
Letter to the Editor from Juan José Aranguren, President, Shell Argentina Shell CAPSA: 29 September 2007
Defending the truth
Unless Mr Taillant has obtained information from the Secretariat of Environment and Sustainable Development supporting such accusations, that it is not available in the corresponding administrative file and for this reason unknown to Shell, his accusations are totally unfounded as it was the recent closure of Shell’s refinery.
If Mr. Taillant would have professed any intention to defend the truth – instead of accusing the Herald for allegedly defending the indefensible – he should have also referred to the solid legal arguments mentioned in Shell’s administrative appeal denying each of the unfounded allegations stated in the closure resolution.
Shell does not only show an attractive rhetoric in its web site, which by the way is a clear reflection of how we do care for the environment, but puts in practice our business principles and highest standards.
If Mr. Taillant has any doubts, I would like to invite him and any other member of the CEDHA to visit our refinery, this may help them to understand what everybody should defend, …just the truth.
Juan José Aranguren