Washington – The Export-Import Bank of the United States dealt a blow to Peru on Thursday by voting against $214 million in loan guarantees for the Camisea natural gas project.
“The board voted down Camisea”, Phil Cogan, a spokesman for the bank, told Reuters. “It was rejected because it didn’t fully meet the Ex-Im Bank’s environmental guidelines.”
Camisea is being built by two consortia which include Argentina’s Pluspetrol and Techint and Hunt Oil of the United States. The project would turn Peru into a net exporter of hydrocarbons.
Thursday’s vote marked a victory for environmental and indigenous groups, which have lobbied long and hard against the $2 billion project on the grounds that it would harm Peru’s pristine jungles and native inhabitants.
“Ex-Im board members displayed courage and environmental leadership in the face of considerable pressure,” said Jon Sohn, international campaigner for Friends of the Earth. “Friends of the Earth applauds Ex-Im’s decision to deny U.S. taxpayer support of Camisea and the massive environmental destruction it would cause.”
Environmentalists have said that studies commissioned by the Ex-Im Bank showed the project did not comply with the bank’s environmental requirements.
Peruvian officials say they have provided the necessary environmental safeguards, and that the project is already fully financed without the support of the Export-Import Bank.
Cathy Ross, a coordinator for the Amazon Program of Oxfam America, said civic groups wanted more environmental guarantees.
“Civil society groups never asked for financing to be canceled. Ex-Im Bank was in between a rock and a hard place because of the inflexibility of government and the companies to develop a real solution to serious problems cited,” Ross said.
The bank’s decision raises a question over a separate $75 million credit for Camisea from the The Inter-American Development Bank (IADB). According to Peruvian officials, the IADB board is due to meet on Sept. 3 to decide on that loan.
Participation by both the IADB and the Ex-Im Bank would give Camisea an environmental seal of approval.
The IADB financed its own environmental studies and one IADB source said the Ex-Im Bank decision “may affect the structure of the financing,” without giving more details. (Additional reporting by Mary Powers in Lima)
