Unocal

Unocal was acquired by Chevron in 2005. Unocal was once a prominent gasoline retailer in the western U.S. and one of the largest U.S.-based independent oil and gas exploration and production companies.

Previously, Hoovers wrote about Unocal, "Unocal develops crude oil and natural gas properties in the Gulf of Mexico, Asia, Africa, and Latin America, and it has proved reserves of 6.6 trillion cu. ft. of natural gass and 681 million barrels of crude oil and condensate. It also produces geothermal energy in Indonesia and the Philippines and makes petroleum coke, graphites, and silicon carbide materials for high-tech products such as semiconductors."--Hoover's Online

History
The Union Oil Company of California was founded by Lyman Stewart, Wallace Hardiman, and Thomas Bard on October 17th, 1890 and headquartered in Santa Paula, a hundred miles northwest of Los Angeles. This original building is now the California Oil Museum. Stewart and Hardiman had met in the Pennsylvania oil fields and moved out west in the 1880's to follow the potentials that state promised. In 1890, they merged their holdings with that of Bard, a west coast business man, who shared with them the awareness of the future of oil. By 1913, Stewart, last of the three left, opened up Union Oil's first service station at Sixth and Mateo in downtown LA. By 1925, they had over four hundred stations.

During the Great Depression they invented and released 76 Gasoline and Triton motor oil which helped motorists get better performance from their automobiles. As the war in Europe was beginning, the company hired former steel man Reese Taylor, who increased prospect, production and refining to support the Allied effort. After the war they were able to branch out, making natural gas discoveries in Alaska, the first oil discoveries in Australia, leading the charge in offshore oil-drilling in the Gulf of Mexico. They created a strong chemical company and developed a revolutionary refining technology, Unicracking, which became widely used around the world.

In 1965 they merged with The Pure Oil Company of Illinois which gave them national status and operations in thirty-seven states. They continued their operations in Alaska, finding oil to match their gas discoveries, and in the Gulf of Mexico finding gas to match their oil. They discovered the Attaka Oil Fields offshore of Indonesia, set up operations in the often turbulent North Sea, and they discovered commercial gas reserves in the Gulf of Thailand. They have also been an international leader in Geothermic Energy.

In 1983, Union Oil Company of California became an operating subsidiary of a new Delaware holding company named Unocal, whose name they took on in 1985. In the 1990's, under the guidance of long time leader Fred Hartley, Dick Stegemeier, and new CEO Roger C. Beach, Unocal became the largest independent oil and gas producer, with new prospects opening up in Gabon, Brazil, Bangladesh, Afghanistan and their favorite spot, the Gulf of Mexico.

ChevronTexaco (now Chevron) to Purchase Unocal
On April 5, 2005, the Wall Street Journal reported ChevronTexaco (Chevron) agreed to purchase Unocal for $16.2 billion. Other news sources reported the planned sale as high as $18.4 billion. The Foundation for Taxpayer and Consumer Rights reported that, "Today's announced merger indicates ChevronTexaco's desire to corner the market on LNG [liquified natural gas], of which Unocal controls significant supplies in the Far East." The group is also looking into ties between ChevronTexaco and California governor Arnold Schwarzenegger, who received a $100,000 donation to a political fund weeks after appointing a host of lobbyists and lawyers from the ChevronTexaco camp to draft the California Performance Review, an analysis of the efficacy of state government.

Commentary
Becoming one of the major leaders in gas and oil production does not happen from handing flowers out in the local town square. Nor does it happen from politely asking native populations to abandon their homes and toil exponentially in a vast industrial project that has nothing to do with their lives. Unocal, in advancing along the path of success, in fact becoming one of the oldest industrial companies in the top 100 of their field, has allowed, abetted, possibly encouraged and significantly benefited from practices by countries that use tactics of war to greaten the profit margin of projects that will yield access to large amounts of natural reserves on land that is not theirs, through partnerships with governments that obtained power via undemocratic means. (Unknown source).

Burma (Myanmar)
Late in 1996 a lawsuit was filed in Los Angeles District Court, Doe v Unocal cv-96-6959 RAP, which sought reparations for Unocal's complicity in the Myanmar regime's behavior in areas relevant to a pipeline that is under construction. Unocal is not the only company involved with this project, known as the Yadana Natural Gas Pipeline Project.

A French oil company, Total has a 31.24% investment in the project, the Petroleum Authority of Thailand(PTT) has a 25.5% stake in it, the Myanmar Oil and Gas Enterprise (MOGE) has a 15% cut in the deal. Unocal has the remaining 28.26%. Even Halliburton got involved when its joint venture with Saipem of Italy, European Marine Services installed the necessary 365 kilometer offshore portion of the pipeline.

The lawsuit alleged a series of crimes committed by the Myanmar paramilitary and intelligence organization, SLORC, (which stands for the State Law & Order Restoration Council. After a nine year run, SLORC's personal was downsized on November 15, 1997 and renamed the State Peace and Development Council(SPDC). MOGE is not seperate from the Myanmar regime and directly benefited from the violent actions of SLORC and the current enforcements of SPDC. In fact, everyone involved in the Yadana Pipeline Project benefits from the violent displacement, forced labor, rape and forced prostitution, death and destruction of local towns that has occurred by the hand of SLORC to minimize costs and communications and to maximize profit and control of the resources being made available.

The plaintiffs have claimed as much in the suit, which relies on the Alien Tort Claims Act, a 1789 law that grants federal jurisdiction to crimes of torture and the such committed on foreign soil, even by foreigners, if they can be served on U.S. soil. The ATCA has been seen as the last resort to responding to corporations' wide range of abuses across the planet.

In 1997, the federal court in Los Angeles decided to hear the case and ruled that corporations and their executive officers can be held legally responsible under the ATCA for crimes against humanity. After three years of discovery, the court said: Despite all this, the Court dismissed the case because the Plaintiffs had not shown that Unocal wanted the military to commit these abuses. The Plaintiffs appealed the decision and on September 18, 2002, a three-judge panel on the United States Court of Appeals for the Ninth Circuit reversed the lower court's ruling, stating the Plaintiffs only had to show that Unocal knowingly assisted the military, and determined the Plaintiffs could proceed with trial. This was challenged and in February of 2003, the decision was to be left to a panel of eleven judges. The Department of Justice entered a brief on behalf on Unocal in opposition to the use of the ATCA for reasons like this.
 * "Unocal knew that the military had a record of committing human rights abuses; that the Project hired the military to provide security for the Project, a military that forced villagers to work and entire villages to relocate for the benefit of the project; that the military, while forcing villagers to work and relocate, committed numerous acts of violence; and that Unocal knew or should have known that the military did commit, was committing and would continue to commit these tortuous acts"
 * "[E]vidence does suggest that Unocal knew that forced labor was being utilized and that [Unocal and Total, a co-founder in the Yadana project] benefited from the practice."
 * "The violence perpetrated against Plaintiffs is well documented in the deposition testimony under seal with the Court."

On December 13, 2004, Unocal announced it had reached an out of court settlement with the Plaintiffs. This marks the first time a corporation has settled in any way a case based on the Alien Tort Claims Act. This will settle both the federal and state cases against Unocal for their role in atrocities committed against the people of Burma. The U.S. Council for International Business stated this decision does not authenticate all the other "inappropriate" cases filed under the ATCA. The details of the settlement are secret, but they will keep Unocal out of the scheduled June 2005 trial, which, ultimately is a victory for them. 

Afghanistan
Unocal has been very involved in the Afghanistan, Pakistan and Turkmenistan part of the world. These regions are central to a trans-Afghan pipeline which would grant broad economic and military power throughout the Eurasian landmass. Military decisions in the Balkans by NATO forces mirrored the same concerns of control for these vital areas.

Before Unocal was able to make their first bid in the region, Bridas, an Argentinian oil company headed by an ambitious Carlos Bulgheroni struck a deal with the Rabbani government which gave him a thirty year agreement on an 875 mile pipeline. Bulgheroni looked for partners, among them Unocal, and was turned down. Teaming up with Saudi Arabia's Delta Oil,Russia's Gazprom, and Turkmenistan's state owned Turkmenrozgas, Unocal made their own deals with local leaders in the area.

This led to Turkmenistan blocking exports from some of Bridas' oil fields, which led to three lawsuits filed with the International Chamber of Commerce that Bridas eventually won. They lost the suit against Unocal in Texas, in which they charged them with civil conspiracy and tortuous interference. Unocal was awarded a 918 mile pipeline in October of 1995. The Taliban overthrew the Rabbani government with help from the CIA and Pakistan's ISI. This negated whatever thirty year contract Bulgheroni had with Afghanistan which led him to fight back the only way left. Deal with the Taliban, and their dealings went back and forth until two U.S. embassis were bombed in Africa.

President William J. Clinton initiated a freeze on business deals with the Afghani government as it was, and this put a halt to the pipeline. After 9/11, and the subsequent war there, new roads have miraculously opened up for work on huge $3.2 billion deal signed in December of 2002 between Pakistan, Turkmenistan and Afghanistan. The new president, Hamid Karzai, has been associated with Unocal, but whether he was ever on their payroll has been denied by both sides..

Among others associated with Unocal in the Afghani region have been: Henry Kissinger, Robert Oakley, Richard Armitage, and Zalmay Khalilzad.; ; ;

Coalition brands Unocal 'a dangerous scofflaw corporation'
Unocal's history is a chronicle of one major oil leak or spill after another. Multinational Monitor named Unocal one of the 10 worst corporations of 1994 and 1998. In September 1998, "a coalition of 30 citizens' groups petitioned then Attorney General of California Dan Lungren to begin charter revocation proceedings against Union Oil Company of California (Unocal)" which they referred to as "a dangerous scofflaw corporation".

In 1969 a blowout at Unocal's (then Union Oil of California), Platform A off the pristine Santa Barbara coast poured 200,000 barrels of crude into the ocean. Massive underground leaking in Avila Beach California resulted in the demolition of the town , And another, the central coast town, Orcutt, was similarly found to be contaminated. Unocal reached a $43.8 million settlement for a long time diluent release in the Guadalupe dunes, California.

In San Francisco, Unocal was found guilty of "continuously dumping excess selenium into San Francisco Bay". In Kenai, Alaska, a Unocal ammonia and fertiliser plant experienced an explosion that "ruptured a containment tank, causing about 30,000 gallons of methyldiethanolamine (MDEA), a chemical solution, to spill and about 500 pounds of ammonia gas to vent into the air". At Cook Inlet Alaska many violations are alleged. A spill in East Kalimantan, Indonesian Borneo  compounded years of what the locals say was abuse by the oil giant.

Quotes
"We have committed misdemeanors in the past," Lane admits, "but then so have many companies"

Board of Directors

 * Charles R. Williamson, Chairman and CEO, Unocal Corporation (director since 01/01/00).
 * Craig Arnold, Senior Vice President and Group Executive, Fluid Power Group, Eaton Corporation (industrial manufacturing company) (director since 02/01/04).
 * John W. Creighton, Jr., Vice-Chairman; Former Chairman/CEO, UAL Corp (United Airlines); Former President/CEO, Weyerhaeuser Company (director since 05/01/95).
 * James W. Crownover, Former Director, McKinsey & Company, Inc. (director since 12/01/98).
 * Ferrell P. McClean, Former Managing Director, Investment Banking and Senior Advisor to Head of Global Oil & Gas, Investment Banking of JPMorgan Chase & Co. (director since 12/01/02).
 * Richard D. McCormick, Former Chairman, President and CEO, US West, Inc. (since 02/01/04).
 * Donald B. Rice, Chairman, President, CEO and Co-Founder Agensys, Inc. (director since 12/01/98).
 * Kevin W. Sharer, Chairman, CEO, and President Amgen, Inc. (director since 06/01/97).
 * Mark A. Suwyn, Portfolio Company Management, Cerberus Capital Management Operations (private equity firm) and Former Chairman and Chief Executive Officer, Louisiana-Pacific Corporation (building materials) (director since 02/01/04).
 * Marina v.N Whitman, Professor of Business Administration/Public Policy, University of Michigan (director since 04/01/93).


 * Unocal [i.e. Chevron] Board Member list updated June 27, 2005.

Contact
Unocal Corporation 2141 Rosencrans Avenue, Suite 4000 El Segundo, California 90245 Phone#: (310)-726-7600 URL: http://www.unocal.com

Related SourceWatch articles

 * oil industry

Data

 * Unocal Data Sheet, Last updated April 8, 2000.
 * For a list of companies currently doing business in Burma go here.
 * UNOCAL Investor Information Governance Guidelines.
 * Chevron/Unocal Agreement, posted at chevron.com website; includes press releases, SEC filings, and presentation, April 4, 2005-June 23, 2005.

Websites

 * CCR-NY.org website: "Corporate Accountability."
 * EarthRights.org website.

Articles & Commentary

 * Energy: Key to Asia's Economic Recovery: Remarks by Roger Beach, Chairman and CEO, Unocal Corporation to the Asia Society, New York, June 22, 1998.
 * Patrick Martin, USA: Unocal Advisor Named Representative to Afghanistan, World Socialist Web Site/Corpwatch, January 3, 2002.
 * Tom Turnipseed, A Creeping Collapse in Credibility at the White House: From ENRON Entanglements to UNOCAL Bringing the Taliban to Texas and Controlling Afghanistan, CounterPunch, January 10, 2002.
 * Marco Simmons, Unocal in Burma, EarthRights International, August 2002.
 * Ian McWilliam, "Central Asia pipeline deal signed," BBC, December 27, 2002.
 * Agreement On US $3.2 Billion Gas Pipeline Project Signed, PakNews.com, December 28, 2002.
 * Dale Kasler, Unocal to Face FTC Charge. The agency reportedly will allege the oil firm misled state air panel, Sacramento Bee, February 19, 2003.
 * Dale Kasler, FTC: Unocal Duped State. Gas-formula manipulation cost consumers millions, the trade agency charges, Sacramento Bee, March 5, 2003.
 * Myint Thein, "Unocal's Slave Labor Problems in Burma," Asian Tribune, March 19, 2005.
 * David R. Baker, "$18.4 billion purchase of Unocal by Chevron: Deal puts new sources of gas and crude in the right places for East Bay oil giant", San Francisco Chronicle, April 5, 2005.
 * "Unocal Stockholders Elect Directors, Vote on Other Proposals at 2005 Annual Meeting," Energy Journalist, May 24, 2005.
 * Press Release: "Federal Trade Commission Accepts Chevron’s Acquisition of Unocal," chevron.com, June 10, 2005.
 * Charlie Zhu, "China's CNOOC to decide on Unocal bid," Reuters, June 21, 2005.
 * "Unocal Receives Merger Proposal From CNOOC for $67 Per Share," PRNewswire, June 22, 2005. CNOOC = China National Offshore Oil Corp., China's third-largest oil producer.
 * "China National Offshore Oil Poised To Trump Chevron's Bid for Unocal," NewsFactor, June 22, 2005.
 * "Chinese bid for Unocal draws quick, high-powered criticism," USA Today, June 23, 2005: "Two former CIA directors and a former chairman of the Joint Chiefs of Staff sounded the alarm Thursday about the proposed purchase of U.S. oil company Unocal by a Chinese government-controlled firm. ... The critics included top-level members of the Reagan, first Bush and Clinton administrations."
 * "Unocal Receives Waiver Enabling It to Engage in Discussions With CNOOC," PRNewswire, June 23, 2005.
 * Ben White, "Chevron Says Unocal Offer Stands Despite CNOOC Bid," Washington Post, June 24, 2005.
 * "China bid for Unocal faces hurdles," Associated Press, June 24, 2005: "The hostile $18.5 billion bid from the Chinese state-owned oil company CNOOC Ltd. to buy oil and gas company Unocal Corp. yesterday has significant regulatory hurdles to overcome, not least of which is whether the deal would threaten national security."
 * Steven Irvine, "Uncle Sam's CNOOC dilemma," Finance Asia, June 24, 2005: "Chinese oil company makes trump bid for Unocal. But will the US block it as it did with Hutch bid for Global Crossing?"
 * "CNOOC Limited To Withdraw Unocal Bid," Energy Journalist, August 2, 2005.
 * "CNOOC Withdraws $18.5B Bid for Unocal," Associated Press, August 2, 2005.
 * "Unocal Stockholders Approve Merger With Chevron," Energy Journalist, August 10, 2005.