New York, NY – Environmentalists decried efforts by the Ecuadorian government delegation who is in New York this week to auction an oil concession in the heart of Yasuni, Ecuador’s largest and most prized National Park. Critics warned investors of major risks: Amazonian indigenous communities continue steadfast resistance to oil drilling in their territories while legal actions–including a lawsuit against ChevronTexaco in Ecuador – -seek clean up for the massive contamination caused to date in the Amazon.
Finding investors for the $5 billion project, known as ITT (Ishpingo-Tambococha-Tituptini), may be a focus of the newly elected President Lucio Gutierrez’s New York visit. However, it cannot be overlooked that the country’s indigenous peoples’ party put Gutierrez in power and expects him to defend their interests.
With meetings scheduled on Friday with ChevronTexaco, Occidental Petroleum and ExxonMobile, government officials say they hope to promote the investments in the ITT project, touting the oil field as the “crown jewel” of Ecuador’s oil sector. Covering over 2 million acres, the Yasuni National Park is a unique flooded forest ecosystem boasting one of the highest numbers of tree and bird species in the World and is home to the endangered Amazon pink river dolphin. The park, designated by the UN as a UNESCO Biosphere Reserve in 1989, is home to the Huaorani people, of which two bands, the Taegari and Taromenane, are virtually uncontacted.
Amazon Watch and Acción Ecologica remind investors to consider the risks of Ecuador’s energy sector where environmental and social controversies have proven costly and often underestimated. Recent examples include the OCP pipeline, Burlington’s Block 24, or CGC’s Block 23 where the companies have lost millions in schedule slippages, cost overruns, and permanent damage to their public image.
Construction of the country’s controversial new heavy crude pipeline, known as the OCP, is currently suspended in the cloud forests of Mindo due to violations of the environmental management plan. The consortium reported in late 2002 that they are six months behind and more than $200 million over budget. Recently, Moody’s downgraded OCP’s rating. The project’s financiers have also face international protests in more than 8 countries.
In the southern Ecuadorian Amazon, Quichua, Achuar, and Shuar indigenous peoples have been resisting the entrance of Argentina’s CGC, and the US-based Burlington Resources in the courts since the day the concessions were granted. Just last week, CGC announced it had suspended seismic testing because of local opposition and safety concerns for their workers. A legal injunction, which bars the company from approaching individual Shuar families to negotiate, has forced Burlington to declare Force Majeure since November 2000.
Much of the opposition stems from the dismal track record of Texaco. Now ChevronTexaco – the company was the first to exploit oil in Ecuador and is the subject of a mounting international campaign and lawsuits to clean up more than 350 contaminated waste sites and to compensate local communities who have been suffering the consequences of the environmental and social devastation – -contamination of soil and water, deforestation, cultural demise – -from the company’s 20-year operation.
Ecuador is under pressure from the IMF to expand oil production in the remaining frontiers of the Ecuadorian Amazon to meet payments on its $15 billion external debt. Amazon Watch and Acción Ecologica call for the cancellation of Ecuador’s debt in favor of permanent protection in ecologically and culturally sensitive areas of the Amazon.
