From pages 17, 18 & 19 of Royal Dutch Shell and its sustainability troubles Background report to the Erratum of Shells Annual Report 2010
The report is made on behalf of Milieudefensie (Friends of the Earth Netherlands)
Author: Albert ten Kate: May 2011.
For a decade or more, beginning in 1977, Shell produced organochlorine pesticides (aldrin, dieldrin, endrin etc.) and other pesticides at a plant located near Pauli?nia, about 125 kilometres north-west of Sa?o Paulo, Brazil. The plant covered approximately 40 hectares.78 Due to its severe health impacts, by 1990 the use of aldrin and dieldrin was totally banned in the USA and Brazil.
After negotiations starting in 1993, in 1995 Shell sold the Pauli?nia facility to the companies American Cyanimid and BASF. A sales condition was that Shell would assume legal responsibility for the pollution at the site. In 2000, BASF took full ownership of the facility.79 In 2002, BASF shut it down the facility after a ban by the Brazilian Ministry of Labour, in view of existing contamination and serious risks to human health.
Pollution at the factory site
There have been many cases of pollution at the factory site: ? Between 1998 and 1985 three leaks in a waste-water storage tank were officially reported. ? Over the years, CETESB (Sa?o Paulo State Environmental Protection Agency) had issued three warnings that the plant’s incinerator was not operating within acceptable standards. ? March 2001, the Justice Department listened to the testimony of a former company employee, Antonio de Marco Rasteiro. He confirmed the existence of four clandestine landfills inside the plant area, and accused Shell of dumping ash from its incinerator and waste from its manufacturing process in these landfills. He also confirmed that Shell’s incinerator sold its services to third parties, for example to DuPont. He also reported that drums with toxic wastes were buried in other areas inside the plant.
Pollution spreading across farmlands
Later, several studies of the area revealed that the contamination had moved into the groundwater under the farms located between the plant and the Atibaia River. For example, in February 2001, the Dutch environmental consulting company Haskoning/Iwaco, hired by Shell, produced a technical report with soil and groundwater analysis in nine sites located in the farms near the industrial site. Levels of contamination by dieldrin as high as 17 parts per billion (ppb) in soil and 0.47 ppb in water were found. The water contamination levels were higher than the levels allowed by Brazilian law (Administrative Rules 36/1990 and 1469/2000 – Ministry of Health Highest Permissible Level: 0,03 ppb of dieldrin). However, no decontamination work had begun in the area. In February 2001, Shell admitted that it had contaminated the groundwater and sections of the nearby community, and was ordered by CETESB to begin a clean-up.
Pollution creating severe health problems
Both aldrin and dieldrin are highly toxic to humans, the target organs being the central nervous system and the liver.83 A report at the request of the Pauli?nia local government, produced by August 2001, showed that 156 of the 181 examined residents living near the factory had some degree of contamination from metals or pesticides which could result in various cancers, liver disorders, or neurological problems. Shell dismissed the Pauli?nia report, saying it used very low thresholds to measure contamination compared with those recommended by the World Health Organization. Shell also claimed its own tests showed no human contamination. If there is proof of contamination with the products that we handled there, we will assume the responsibility immediately, which is our policy worldwide, said Jose Cardoso, a Shell manager in Brazil. But so far, there is no data indicating that.84 Maria Lucia Braz Pinheiro, vice president of Shell- Quimica for Latin America, described the report as another report with technical inconsistencies and lacking a scientific base.
In a doctoral dissertation approved in February 2005, an analysis was made on the existing health data from a group of 62 former Shell/Cyanamid/BASF workers. Three cases of thyroid cancer were confirmed. The author concluded that the incidence of thyroid cancer among the estimated 1,120 workers of Shell/Cyanamid/BASF was 166 times greater than the incidence in the male population of Campinas, a county within Sao Paulo state. The chance of finding three cases of thyroid cancer out of a random selection of 1,120 men living in Campinas would be less than 1 out of 1,000,000.
At the beginning of 2009, it became publicly known that the Center for Excellence in Occupational Health (Cerest) of Campinas had examined 69 former employees of Shell / Cyanamid / BASF. Ten malignant cases of cancer to the prostate and thyroid were diagnosed. There was also a case of myelodysplastic syndrome (MDS, formerly known as “preleukemia”). There were 34 cardiovascular diseases, of which 21 related to hypertensive heart diseases. There were also an unspecified number of liver diseases. In 30 cases there was a prevalence of repetitive strain injury (RSI). In total 56 ex-workers had serious problems with reproductive organs and the urinary system, with prostate disorders, changes in fertility and impotence.
August 2010: Shell/BASF ordered to pay severe fine
In 2007, the public prosecutor Ministe?rio Pu?blico do Trabalho (MPT) filed a case to ensure funds for health treatment of former employees, along with compensation for damages. The Association of Workers Exposed to Chemical Substances (ATESQ) and another union of workers had also filed a case against Shell and BASF. ATESQ was created by Antonio de Marco Rasteiro, a former employee of the Shell/BASF plant in Pauli?nia. He worked there for 21 years. In his role as ATESQ Coordinator, Mr Rasteiro has led the struggle of nearly a thousand former workers. In November 2009, he won the International Health & Safety Award of the American Public Health Association.
In August 2010, a Brazilian court (Tribunal Regional do Trabalho de Campinas) ruled that Shell and BASF should assume responsibility for the medical treatment of all former employees of the Pauli?nia facility, and pay a total of 1.1 billion Brazilian Real (about EUR 490 million89) in connection with the More than 1,000 former employees of the companies were covered by the court order, and also the children of employees who were born during or after services and independent contractors.
Some extracts from the court ruling in August 2010: ? Workers were constantly exposed to harmful substances in water and air, without any use of protective clothing. This exposure took place during and after work, during breaks, in the vicinity of the site, as well as through the use of water on site. Therefore, the simplistic explanation of Shell that the presence of harmful substances in the bodies of the workers do not constitute evidence of intoxication is unacceptable
? (…) Although it is not certain that all employees will develop diseases such as cancer, it is not excluded. Certainly it has been determined that among the employees exposed to the pollutants, cancer occurs much more frequently than normal. ? (…) The most shocking is that the accused companies, especially Shell, were since 1970 fully aware of the harmful effects of substances used by them. After the production was banned in the U.S., Shell coolly moved its plant to Pauli?nia. BASF also has not taken precautionary measures: it was aware of the pollution at the site, which was already raised and well known in Pauli?nia. Nevertheless, BASF located itself in the same place, in the full knowledge that this place was not appropriate, with the result that its employees were exposed to obvious risks.
Shell and BASF appealing
Soon after the court order in August 2010, Shell and BASF announced that they would appeal the decision. We expect that the Brazilian courts at a higher level will eventually establish that we were not responsible for alleged health impacts and other claims, a Shell spokesman told press agency Reuters.
Jennifer Moore-Braun, a spokeswoman for Basf told press agency Bloomberg: We are of the opinion that the environmental damage was caused by Shell, and we will appeal the decision. Shell was quoted saying: We are convinced there is no link between our operations and injury to peoples health based on blood tests of local residents, medical assessments of former workers and expert medical opinions.93 In April 2011, the Tribunal Regional do Trabalho de Campinas denied an appeal filed by Shell and BASF against the decision, and maintained the sentence. Shell and BASF may appeal the decision at the Superior Labour Court (TST) in Brasilia.