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(Washington D.C.) – Environmental and indigenous rights organizations today criticized the senior management of the Inter-American Development Bank (IDB) for failing to attend a public “consultation” on the spill-prone Camisea gas pipeline, a bank-funded project affecting a globally renowned rainforest in the Peruvian Amazon.
The civil society groups also condemned the bank for continuing informal talks with the project consortia, including leading shareholder Texas-based Hunt Oil, over financing deals for future phases of the controversial Camisea project, before resolving the multiple problems of the project’s first phase.
Peruvian and International organizations including the Society for the Protection of Environmental Law, Amazon Watch, World Wildlife Fund-Peru, the Amazon Alliance and Environmental Defense as well as E-Tech International testified during the daylong meeting at the IDB’s headquarters in Washington D.C. on Monday. Yet the only senior IDB executive to attend was Executive Vice President Ciro de Falco, who stayed for several minutes, delivering a prepared statement, taking no questions and missing the other presentations.
During today’s “consultation”, the IDB:
• Indicated they are likely to formally begin due diligence to consider financing the second phase of the Camisea project, spreading the environmental damage of the first phase over a larger area of the Amazon rainforest and among many more indigenous communities;
• Failed to explain why previous commitments to prevent spills from the pipeline have not stopped the incidents; the pipeline has ruptured four times, with three major spills, in its first 15 months in operation.
Aaron Goldzimer, of Environmental Defense, added: “Today we heard more misinformation and evasion from the Peruvian authorities and project companies regarding one of the world’s most controversial infrastructure projects. Their patronizing message was ‘Thank you for your comments, but we know best.’ We need truly independent monitoring, a full audit of the pipeline, and vastly improved regional planning if we are to have a chance to stop further disasters.”
Maria Ramos, southern Peru campaigner for Amazon Watch, said: “The companies again insist there will be no more ruptures, but the last time they promised that, there were four. The world’s most biodverse rainforests and the highly vulnerable indigenous communities that live there are in real jeopardy.”
She added: “It is clear that the Peruvian government does not have the capacity to adequately regulate a project of this massive scale; never mind the 16 new hydrocarbon projects that are slated for Peru’s rainforest regions. There is little planning or coordination and the Peruvian government is in over its head.”
Michael Valqui, program officer for World Wildlife Fund – Peru said: “This annual meeting highlights that key promises and commitments given at the outset of the Camisea project by the government of Peru, IDB and the companies for the most part, have not been realized.”.
Peter Kostishak, Co-Director of the Amazon Alliance, said: “While the IDB talks about ‘benefits that don’t evaporate’, the truth is that the indigenous communities in the Amazon suffer liquid gas spills that don’t evaporate. . In return for contamination of their food and drinking water, they receive a miniscule percentage of this energy project’s windfall profits.”
Juan Miguel Cayo, Peru’s Vice Minister of Energy and Mines, who also attended the meeting admitted that the poverty of the affected communities, contrasted with the funds received by local government officials from Camisea, is “immoral”. He added that investments in healthcare for affected communities are badly needed.
Nevertheless, the meeting did provide a glimmer of hope for skeptical environmentalists and indigenous rights advocates. In a response to allegations that it had used corroded pipes left over from other projects, the President of the pipeline consortium Transportadora de Gas del Peru (TGP), agreed to open its internal pipeline records –known as the Paybook—to civil society experts. Meanwhile, the IDB agreed to meet with Peruvian civil society groups to jointly set terms of reference for an independent audit of Camisea, an audit which the bank has the contractual right to initiate.
The consultation came as an independent report, by non-profit environmental consultancy E-Tech International, concluded that Camisea’s spill-prone pipeline was shoddily built by unqualified welders using corroded pipes. The report also found that the pipeline was laid precipitately on difficult terrain to avoid onerous late-completion fines that could have totaled $90 million, and nearly 185 kilometers of the pipeline remains at high risk of rupturing.
Bill Powers, of E-Tech, said: “When you have a project of this scale in an area as sensitive as the Peruvian Amazon rainforest, then you need your A-team. Unfortunately, the construction work on this pipeline was hastily done and without adequately qualified supervision. The spills were predictable, and, we believe, there will be more ruptures unless there is a complete examination of pipeline construction process to properly assess pipeline integrity and detailed remedial action measures to assure the damaged areas are fully stabilized and restored.”
The Camisea gas project has been a running controversy in Peru and at the IDB since breaking ground in 2001. The upstream component is located in one of the most biodiverse tropical rainforests in the world, home to thousands of indigenous peoples, including some of the last indigenous groups living in isolation anywhere in the Amazon.
The project has had devastating repercussions for those communities and on the natural environment, despite the warnings of Peruvian and International civil society groups. Under intense pressure, the IDB imposed a range of environmental and social conditions on the project consortia, led by Dallas-based Hunt Oil and Argentina’s Techint, but failed to adequately enforce these conditions.
Despite the IDB and Peruvian government’s rhetoric of “development” and “poverty alleviation”, 40 percent of the Camisea royalties paid to the central government have been set aside by Peruvian legislation for arms procurement.
Although “Block 88”, the first phase of the Camisea project, is already operating, the E-Tech International report’s warnings are timely. The pipeline feeder network will soon be expanding to serve other nearby concessions, including “Camisea II,” which involves many of the same companies and broke ground last month.
Additional Press Contacts:
Aaron Goldzimer, Environmental Defense: 202-297-2507
Peter Kostishak, Amazon Alliance: 202-785-3334
Richard Kamp, E-Tech International: 505-670-1337
Michael Valqui, World Wildlife Fund- Peru: 011-511 9 732 7981
