Conflict Comes Home to Unocal : Oil: Armenian-American leaders claim the company is tilting toward Azerbaijan. Protesters ask customers to return credit cards in protest.

Two Southern California Armenian-American groups have launched a boycott of Unocal Corp. service stations to protest the oil company’s negotiations with the Republic of Azerbaijan to develop a giant oil field in the Caspian Sea.

They say that Unocal and other U.S. energy companies are tilting toward Azerbaijan in its bloody war with Armenia.

The activists have picketed Unocal’s headquarters and plan today to pass out 10,000 envelopes at the Navasartian Games in Van Nuys urging spectators of the traditional Armenian summer Olympics to cut up and return their Unocal credit cards.

Unocal executives say that they are not playing favorites in the fighting between the two former Soviet republics, which erupted four years ago after residents of the Armenian enclave of Nagorno-Karabakh in Azerbaijan demanded greater autonomy.

“We are oilmen and we do not get involved in politics,” Unocal spokesman Barry Lane said when the boycott was announced in May.

While some Armenian-American leaders think a boycott may not be the best tactic, the broader issue of the oil companies’ dealings with Azerbaijan has great resonance in the Armenian community. The Los Angeles area population of about 300,000 is the largest Armenian community outside the nation itself.

“The feeling of wanting to boycott U.S. companies--especially oil companies--that are dealing with Azerbaijan, is universal among Armenians,” said Kenell Touryan, associate executive director of the Armenian Missionary Assn. of America, a non-sectarian group based in Paramus, N.J., that does not take political positions.

Even the boycott leaders, however, do not want to estrange Armenia from the Western oil companies that offer desperately needed outside investment.

“We’re not against any oil firm taking profits in Azerbaijan,” said Stephan Boyadjian, a central executive member in the western region of the Armenian Youth Federation. “It’s that they have become a political player.” The federation and the Shant Student Assn., a Los Angeles-based organization of Armenian-American students, organized the boycott.

Unocal, which is negotiating with Azerbaijan’s state oil company, believes that a joint venture would help the entire area. One likely route for a pipeline to bring the oil to a deep-water port would be through Armenia.

“Without a doubt, this project should bring stability and a common economic progress to the region, and not just Azerbaijan,” said John F. Imle Jr., Unocal executive vice president and head of its energy resources division.

Negotiations over the oil deal were cut off when a new Azerbaijani government came to power last Wednesday. But meetings held since then between the new leaders and the U.S. companies leave all parties confident that a deal could be close.

Many Armenian-Americans fear that U.S. oil company investments will be used by the Azerbaijan government to buy arms to fight Armenia. Oil companies negotiating for the Caspian Sea deal have already paid $70 million to the Azerbaijan state oil company.

Azerbaijan has been blockading Armenia and Nagorno-Karabakh throughout the war--leaving the Armenians critically short of fuel and basic necessities.

The Armenian Assembly of America, a Washington-based nonprofit advocacy group representing the Armenian-American community, lobbied successfully for a federal law--Section 907 of the 1992 Freedom Support Act--that prohibits U.S. aid to Azerbaijan without that country taking “demonstrable steps” to end its blockade of Armenia.

“It was the option of last resort,” said Ross Vartian, Armenian Assembly executive director.

Now Vartian and others believe that Azerbaijan is attempting to use the Western oil companies to help overturn Section 907. Vartian said the Armenian Assembly has been assured by Unocal, Amoco and the other oil companies that they are taking no direct action to change Section 907.

The boycott organizers are more skeptical.

Unocal, they point out, is a member of the United States-Former Soviet Union Energy Institute, a group supported by the oil industry. That group--with its congressional arm, the U.S.-FSU Energy Caucus--seeks to ease U.S. trade and investment in the republics of the former Soviet region.

One goal of the institute and caucus is to overturn Section 907, which many in the oil industry say is unfair to Azerbaijan and hampers U.S. companies attempting to do business evenhandedly in the region.

“I think we’d like to see it gone,” said Imle of Unocal, “so the United States would have a neutral position on that.”

Many Armenian-Americans not associated with the boycott remain critical of the oil companies’ actions.

“If the boycott is the thing that attracts the attention of the oil company leaders, then I think it should be used as such,” said Harut Sassounian, editor and publisher of California Courier, a weekly English-language newspaper for the Armenian community, and executive director of the United Armenian Fund, a Glendale-based charity.

Boycott organizers have been buying ads in local ethnic newspapers, speaking on Armenian cable TV shows and planning to distribute more envelopes at future ethnic events.

They also plan to elicit the support of Armenian-Americans who may face the toughest personal decisions--the relatively large group of Armenian owners of Unocal stations.

“As you might understand, they are going to be very sensitive,” admits Raffi H. Hamparian, a boycott organizer and western region governmental affairs director for the Armenian National Committee, in Glendale.

Dick Wilson, executive director of the Southern California Service Station Assn., said Armenian-American Unocal member operators face an unfair choice.

“The folks that the activists propose to boycott had no part in the decision-making process to do business with Azerbaijan,” Wilson said.

As of Friday, Unocal reported 44 credit cards returned in protest by Armenian-American customers.

Oil Politcs Los Angeles Armenian-American groups are protesting Los Angeles-based Unocal and five other oil companies plans to form a joint venture with the Azerbaijan state oil company to develop a giant Caspian Sea oil field.