-i- TO THE SUBROGATE PRESIDENT OF THE ... - Chevron

• With regard to pit remediation, 1105 both the Cabrera Report and the report
of Mr. Shefftz ignore that the Ecuadorian Government accepted
responsibility for remediation with the PEPDA program, and 156 pits have
already been remediated through this process at the cost of US$85,000
per pit. 1106
• As previously discussed, natural gas should never have been included in
the Cabrera Report’s estimates because it was and is the property of the
Ecuadorian State. However, even if it is included, the Cabrera Report’s
analysis failed to subtract the income on the sale of gas from the costs of
capture. 1107 Furthermore, it overestimated the volume of gas by 3,400%
due to the fact that it did not correctly convert the gas volumes from cubic
feet to cubic meters. 1108 Again, since Mr. Shefftz relies upon the data,
including the associated unit costs, presented in the Cabrera Report, his
report does nothing to correct these errors. 1109
Mr. Shefftz’s report merely repackages the Cabrera Report without any new
evidence. Relying exclusively on data in the Cabrera Report, Mr. Shefftz apparently
performed no investigation of the associated facts or the significant deficiencies in the
Cabrera Report, despite those deficiencies having been identified by Chevron on
multiple occasions. 1110 In fact, Mr. Shefftz not only fails to correct the Cabrera Report’s
most serious errors, but he also compounds them by multiplying his calculations by four,
purportedly to account for an arbitrarily chosen twenty-five percent chance that TexPet’s
activities would be detected. 1111 This damage multiplication is foreign to Ecuadorian law,
1105
SOUTHGATE, Douglas, CONNOR, John & MACNAIR, Douglas, Response to the Allegations
of Mr. Cabrera Regarding Supposed Unjust Enrichment of Texpet, attached as an appendix to Chevron’s
Objections to Expert Cabrera’s Global Report, filed Sept. 15, 2008, at 2:14 p.m., Record at 146342-370,
146358 (citing HINCHEE, R., Rebuttal of the Method Used by Mr. Cabrera to Determine the Supposed
Necessity and Cost of Remediation, 2008).
1106 See Chevron’s Motion filed Sept. 16, 2010, at 4:35 p.m., § II.B.4.b.iv.5 and § IV.A, at 148,
216-17.
1107 Chevron’s Objections to Expert Cabrera’s Global Report, filed Sept. 15, 2008, at 2:14 p.m.,
Record at 141082-203, 141176.
1108 Id.
1109 See SHEFFTZ, Jonathan S., Analysis of Unjust Enrichment in Maria Aguinda et al. v.
Chevron Corporation, attached as Annex B to Plaintiffs’ Motion, filed Sept. 16, 2010, at 5:15 p.m., at 5-6,
(Shefftz explains “Exhibits 1, 2, and 3 are my versions of the Cabrera report’s Tables 1, 2, and 3.”).
1110 See SOUTHGATE, Douglas, CONNOR, John A., Response to the Report of Mr. J. S. Shefftz
with Regard to “Analysis of Unjust Enrichment,” issued 13 September 2010, in the Matter of Maria
Aguinda et al. vs. Chevron, at 12-13, attached as Annex 1 to Chevron’s Motion filed Oct. 29, 2010 at 5:20
p.m.
1111 See SHEFFTZ, Jonathan S., Analysis of Unjust Enrichment in Maria Aguinda et al. v.
Chevron Corporation, at 7-8, attached as Annex B to Plaintiffs’ Motion, filed Sept. 16, 2010, at 5:15 p.m.;
see also SOUTHGATE, Douglas, CONNOR, John A., Response to the Report of Mr. J. S. Shefftz with
Regard to “Analysis of Unjust Enrichment,” issued 13 September 2010, in the Matter of Maria Aguinda et
al. vs. Chevron, at 4, attached as Annex 1 to Chevron’s Motion filed Oct. 29, 2010 at 5:20 p.m.; see
CERT. INTERMARK VER: JD
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