One Crude Dude

Last December, Chuck Hamel and his wife celebrated the holidays as they always do, at their home in Marysville. They ate Christmas dinner, sipped wine, took long walks, and watched their goddaughter's children play. It was pleasant and calm, unlike Hamel's racing mind. His thoughts were jumbled with tales of oil, corruption, and conspiracy. As the holidays wound down, Hamel returned to what he does best: sniping at one of the world's most powerful industries, Big Oil.

On New Year's Day, he drove to Sea-Tac and boarded a jet bound for Anchorage, Alaska. When he arrived, Hamel went to a "safe house," as he describes it—a friend's place where nobody would find him. There, he met with one of his informants, an employee of oil giant BP. They talked about how the London-based company was neglecting its pipelines in Alaska, which are literally rusting away on the tundra. While BP has spent hundreds of millions of dollars trying to prevent corrosion, some oil workers claim the company has skimped dangerously when it comes to maintaining the aging equipment that supplies crude to the West Coast.

Hamel, who lives for such gossip, assured the BP informant his identity wouldn't be revealed. That sealed the deal. Together, they phoned a criminal investigator at the U.S. Environmental Protection Agency's Seattle division and gushed. This exchange, coupled with numerous allegations made by Hamel and his moles in recent years, would foreshadow the biggest meltdown in Alaska's oil industry since the Exxon Valdez tanker ran aground in 1989. Last March, one of BP's corroding pipes leaked 267,000 gallons of oil at Prudhoe Bay, the nation's largest oil field. On Aug. 6, BP shut down its Prudhoe Bay facility—which accounts for 8 percent of the country's domestic oil production—after discovering that another corroding pipe, this one peppered with small holes, was oozing crude onto the spongy tundra. BP has since restored production to just over half of Prudhoe Bay and plans to replace 16 miles of worn pipeline at an estimated cost of $170 million.

For Seattle and other Northwest cities that depend on Alaska crude, BP is making up the shortfall by shipping oil from West Africa to its Cherry Point Refinery in Blaine, Wash. Time will tell if the company's troubles will show up at the gas pump.

Meanwhile, two federal agencies— both spurred by Hamel and his whistle-blowers—are probing BP's conduct, and the U.S. Justice Department confirms its own investigation. The company has been hit with a slew of federal and state subpoenas to surrender internal documents on its corrosion program. And a congressional committee plans a hearing Sept. 7 to question BP executives about Prudhoe Bay's mishaps.

Hamel looks like your grandfather. He's 76, short and stocky, with fluffy white hair and bushy eyebrows. He and his wife, Kathy, split their time between a townhouse in Alexandria, Va., and her childhood home on Seventh Street in Marysville, which Kathy inherited from her folks. This modest, three-bedroom abode north of Seattle is a retreat from Hamel's ongoing war with BP. If it weren't for the recent spills at Prudhoe Bay, you'd probably find the Hamels strolling along Potlatch Beach or watching the Mariners lose to Oakland.

Instead, Hamel sits in his Virginia den overlooking the Potomac River, telling anybody who'll listen that he and his band of BP whistle-blowers long warned company officials and government regulators that Prudhoe Bay was falling into perilous disrepair. If you haven't heard of Hamel, it's because he's not the typical activist. You won't find him whining about Starbucks or protesting WTO summits. He doesn't represent any environmental groups. Rather, his cause is personal, fueled by pride, vindictiveness, and a profound loyalty to whistle-blowers who risk their livelihoods by sharing stories of Big Oil misconduct. This one- man show delivers a powerful punch, particularly when it comes to the issue of oil exploration in the Arctic National Wildlife Refuge. Environmentalists have argued that if Prudhoe Bay has problems, then oil companies should not be trusted to drill on ANWR's coastal plain.

Hamel, in short, is the Ralph Nader of Alaska oil, a determined watchdog who once owned oil leases and shipped crude. When he suspected that a supplier lied to him about water in his oil shipments, he turned on the industry. He anointed himself the unpaid voice for fed-up oil workers—a whistle-blower for whistle-blowers. Just as General Motors hired private detectives to discredit auto industry critic Nader in the 1960s, Hamel found himself a target of an industry-engineered sting. During the 1980s and the 1990s, he revealed years of neglected maintenance and pollution in the oil industry. His delving prompted companies to spend hundreds of millions of dollars patching things up.

Some government regulators and oil executives claim Hamel is nothing more than an attention-seeking gadfly, a bully with a chip on his shoulder. They speculate his true motive is to extort money from the industry, a decades-old accusation that Hamel firmly refutes. Other critics argue that he spins half-truths to reporters hungry for a conspiracy.

"To say that he's predicted something bad's going to happen at Prudhoe Bay is like somebody constantly saying the stock market's going to crash," says Larry Dietrick, a director at the Alaska Department of Environmental Conservation. "Sure, if you say it all the time, you'll be right someday—the market will crash. But does that mean you predicted it?"