Talisman braces for jungle standoff

CALGARY - Talisman Energy Inc. said yesterday it would not pull out of the Peruvian jungle, despite threats of violence from Indigenous communities opposed to its drilling plans.

The Canadian oil-and-gas explorer said it received consent, in writing, from a two-thirds majority last June in each of seven communities affected by the drilling of a well, as required by Peruvian law.

But some local aboriginals are now ordering Talisman to leave their lands by tomorrow, or face blockades and work stoppages, according to Amazon Watch, a San Franciscobased environmental organization that is aiding them.

Amazon Watch spokesman Andrew Miller said the Canadian company shouldn't take the warnings lightly, considering the Indigenous groups' long history of mobilization against oil development.

"When Indigenous groups say they might shut operations down, these aren't necessarily empty words," he said.

In a letter to the organization yesterday, Mark Dingley, Talisman's country manager in Peru, said consultations to explain its plans will continue.

However, "We believe the granting of formal consent by the communities directly impacted by or in the immediate area of our activity supports continued operations in our area of interest and a suspension of operations is not warranted," Mr. Dingley writes.

Talisman spokesman Barry Nelson said it doesn't expect unrest, but it's taking "prudent measures in the face of a threat."

The confrontation is reminiscent of Talisman's experience early this decade in Sudan, when a relentless campaign from non-governmental organizations opposed to its presence in the war-torn country eventually forced its exit.

While Talisman initially played down the Sudan controversy, it is now vigorously defending its position in Peru, where it hopes to build a new core area if exploration efforts are successful.

Talisman's subsidiaries have increased their interests in the country over the past three years, but the company has no production yet. All its lands are located in the Maranon basin in northern Peru.

In December, it is re-entering and retesting a well in Block 64 that was first drilled last year to better gauge whether it contains hydrocarbons.

The company said it is honouring a commitment made by John Manzoni, its chief executive, in April to two elders who attended the annual meeting. He said he would shut down the company's exploration plans unless they enjoyed community support.

At the time, Mr. Manzoni said Talisman had learned "from the school of hard knocks" to manage its stakeholder relations "very, very carefully."

Mr. Manzoni "promised we would not go where we are not wanted, and we are flat honouring it," said Mr. Nelson, noting his company is not proceeding with activity in an area in which two communities were opposed.

Mr. Nelson said local newspaper coverage of Talisman's activity shows it has "enthusiastic support." The drilling affects an area with a population of about 1,000.

"With the presence of Talisman in their territory, they have managed to improve their educational and health infrastructure," says one story. "The native leaders denied the existence of any type of contamination and said that every month they monitor the work performance of Talisman."

Mr. Miller, with Amazon Watch, which has a staff of eight, said the area has had bad experiences with oil companies in the past and is worried about alcoholism, sexually transmitted diseases and pollution.

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