New York, NY – Peruvian state-owned oil company Petroperú poses extreme risks for investors, according to a new report by Amazon Watch released during New York Climate Week. Petroperú recently completed the modernization of its coastal Talara refinery at a substantial cost of $5.3 billion, which plunged the company into debt. Through research in partnership with Stand.earth, it was found that the project was financed through a syndicated loan involving banks such as Citigroup, Deutsche Bank, HSBC, JPMorgan Chase, and BNP Paribas.
The risk assessment describes the political, social, financial, environmental, and legal risks associated with investing in Petroperú. It also compiles the perspective of some communities that could be affected by the threat of oil operations by Petroperú: the Achuar People of the Pastaza River and the Autonomous Territorial Government of the Wampis Nation. The Achuar and Wampis peoples have repeatedly rejected oil operations on their territory, and they oppose Petroperú’s plans to develop oil fields on their lands. Petroperú also operates the notorious North Peruvian Pipeline, which constantly leaks and has caused innumerable environmental damages in Achuar and Wampis territories. Just this month, the company reported two massive oil spills.
“We will not allow the entry of oil companies into our territory, and that’s Petroperú in Block 64,” said Nelton Yankur Antich, President of the Peruvian Federation of Achuar Nationalities (FENAP). “We want to live in harmony. We want to protect our territory. We are protectors and guardians of the Amazon.” Recently, Petroperú began operating Block I, located on the North Peruvian coast, and the company is seeking to operate other blocks, including Block 64, located in the Peruvian Amazon, which faces community opposition. As a result, Petroperú is now seeking financing for these operations.
“Since the creation of Block 64, the Achuar People from Pastaza and the Wampis Nation have categorically opposed operations within their territories. There was not a Free, Prior, and Informed Consent process under the international standards of Indigenous sovereignty and self-determination established by ILO Convention 169,” said Gisela Hurtado-Barboza, Advocacy Associate at Amazon Watch and lead author on the risk assessment.
Amazon Watch has already received communications from financial institutions that are troubled by Petroperú’s record. European bank BNP Paribas called the report’s findings “concerning.” Current financiers of and investors in Petroperú include BBVA, HSBC, Deutsche Bank, BNP Paribas, Santander, JP Morgan Chase, Bank of America, Goldman Sachs, and Citibank, as well as the asset management firms BlackRock and Vanguard. Responses from banks can be found on the report webpage.
“Nearly all of Petroperú’s financiers and investors, from Bank of America to BlackRock, have made lofty claims about their commitment to reduce emissions, fight climate change, and respect human rights. But pouring money into Petroperú flies in the face of all of these commitments,” said Moira Birss, Climate Finance Director at Amazon Watch. “These banks and asset managers need to put their money where their mouth is and stop investing in Petroperú and other companies that ignore Indigenous rights and drive climate chaos. Until then, their climate commitments are nothing.”