Pluspetrol Norte: A History of Unpaid Sanctions and Oil Spills in the Peruvian Amazon | Amazon Watch
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Pluspetrol Norte: A History of Unpaid Sanctions and Oil Spills in the Peruvian Amazon

September 30, 2022 | Gloria Alvitres (translated by Sarah Engel) | Mongabay

A thick dark stain spreads near the Piedra Negra ravine, a source of water for the Kichwa community of 12 de Octubre in Loreto. The Indigenous community members say that they do not need to see the stain to know that they are facing a new oil spill. All they need to do is smell the odor – which often gives them nausea and headaches – to know that the nightmare is back. On March 2 and March 17, 2022, the community complained of a familiar problem: again spills in the community, again in Block 192, and again worries about the risk it poses to the lives of people, animals, and plants.

“This month, a well shattered because the pipes are old [and] corroded. The oil has spilled and is reaching the ravine, very close to the Tigris River; it is very dangerous. All the companies that have operated [there] have not been worried about maintenance,” says Hugo Carijano Tapuy, a former Kichwa leader and resident of the 12 de Octubre community.

In this area of the Peruvian Amazon, oil is always present. In March alone, two spills were recorded in the community, a total of four spills this year, according to Tom Chung, the Indigenous monitor for the community. But two reports from Peru’s Environmental Evaluation and Enforcement Agency (OEFA) – one from 2020 and one from 2017 – mention two additional events inside the same area.

Carijano says that during the operations of Pluspetrol Norte, community members complained of the constant crude oil spills. They were sent to the police or were denounced, according to Carijano. The oil company filed a complaint – for which a trial began in March of this year – against a group of Indigenous leaders for aggravated robbery, kidnapping, and possession of weapons. While Pluspetrol Norte focuses on this legal action, the communities insist that the company has escaped its responsibility for the liabilities left in Block 192, alongside the millions of dollars it has to pay in fines.

Similar patterns of impunity, ignored sanctions, and environmental liabilities have happened in Block 8, says Renato Pita, a specialist from the Northern Amazon Oil Observatory (PUINAMUDT), to Mongabay Latam.

The history of Pluspetrol Norte’s operation is listed in the database of fines, sanctions, and ongoing proceedings against oil companies compiled by this journalistic alliance for the #ManchadosXElPetróleo series. The information spans the last 10 years and focuses on the oil-related activity in the Amazon in Peru, Colombia, Ecuador, and Bolivia. In Peru alone, according to the database, the environmental authority has begun 143 disciplinary procedures involving 16 oil companies. These 16 companies have also been fined. Pluspetrol Norte leads the list in Peru, with 73 disciplinary procedures that resulted in 72 fines imposed by the OEFA – between 2011 and 2021 – for its operations in Block 192 and Block 8. The total fines exceed $47 million.

A disputed operation

Pluspetrol Norte has managed Block 8 for the last 25 years. In this time, the concession, located in the districts of Trompeteros and Urarinas in Loreto Province, near the basin of the Corrientes and Marañón rivers, accumulated a long list of fines and sanctions. In Block 192, in the district of Andoas in the Datem del Marañón Province, in the districts of Tigre and Trompeteros, the situation is not too different. There, operations closed in 2015, leaving a trail of complaints about oil spills and unmet remediations.

The Quechua Indigenous Federation of the Pastaza (FEDIQUEP in Spanish), the Organization of the Kichwa Amazonian Indigenous Community on the Peru-Ecuador Border (OPIKAFPE in Spanish), the Cocama Association for the Development and Conservation of San Pablo de Tipishca (ACODECOSPAT in Spanish), and the Federation of Native Communities of the Corrientes River Basin (FECONACOR in Spanish) have constantly protested against Pluspetrol. In March 2020, they complained before the Organization for Economic Cooperation and Development (OECD) about the company’s poor practices and the contamination of their land, especially during the operations in Block 192.

The problem facing the communities now is that they say it is difficult to confront something that isn’t there. Pluspetrol Norte almost no longer exists in Peru. The company began its liquidation in 2020 and has begun to disappear after having operated in the country for 27 years. Pluspetrol Norte’s current address in Lima is that of a co-working office in the Miraflores neighborhood, and there are no institutional reports on the main website of the Pluspetrol business conglomerate, which has a fiscal address in Argentina. This conglomerate owns the following companies: Pluspetrol Norte S.A.C., Pluspetrol Peru Corporation S.A., Pluspetrol Camisea S.A., Pluspetrol Lote 56 S.A., and Pluspetrol E&P S.A.

When the Kichwa people ask for remediation and defend their health, they do not get answers. In fact, doing so is nearly impossible because Block 192 is inactive and the companies that formerly operated it have abandoned the area. The concession has passed through the hands of companies like the Occidental Petroleum Corporation (OXY), Pluspetrol Norte, and Frontera Energy, which finally returned the block to the government last year.

Apu Aurelio Chino, the president of the Quechua Indigenous Federation of the Pastaza (FEDIQUEP), says that it is difficult to communicate with Pluspetrol Norte and that the lack of a response causes discomfort among the Indigenous community members. “They have never participated in the formal dialogues, they have never consulted [with us], they have not come when they have been called to any meetings. We would have liked for them to at least come closer [and] give us explanations,” says Chino.

The oil company’s behavior has attracted the attention of international organizations like the OECD, which is now investigating the company after a series of complaints made by the Indigenous communities. The Ombudsman’s Office of Peru has also taken a position on the case.

In December 2020, while Pluspetrol Camisea S.A. was receiving a sustainability award from Peru’s National Society of Mining, Petroleum, and Energy for its eco-friendly practices, another company from the group–Pluspetrol Norte–was facing a series of legal problems with the Peruvian government. This was because the company’s announced liquidation implied that it was abandoning its environmental liabilities and leaving its debts unpaid. In a statement in February of last year, the Ombudsman’s Office warned of these practices, which they called “an unfortunate precedent that highlights the importance of the Peruvian government urgently evaluating and adopting the corresponding measures so that acts of this nature are not repeated.”

Block 192: abandonment and pending fines

What remains in the territories that are part of the Block 192 concession are environmental liabilities and land that has been contaminated by oil. “The situation never improves; all the companies have had spills from OXY, Pluspetrol, and Petroperu. The pipes are decayed; they’ve been installed for years, and for that reason, [the land] is constantly being polluted,” says Natanael Sandi, the environmental monitor for the community of José Olaya in Loreto. For as long as he can remember, the oil pipeline and oil pumps have caused environmental problems in the Amazon. He claims that he has seen the health of the Indigenous community members becoming compromised. For that reason, he trained to become an environmental monitor to be able to report the damage caused by crude oil.

The history of Block 192 is long; it began with OXY in 1971. It was not until almost 30 years later that Pluspetrol Norte S.A.C. took full responsibility for the concession in 2000, although it was required to leave it in 2015 after it received a series of fines imposed by the OEFA. One year later, in 2016, Frontera Energy took over the operations, but later ended its contract in 2021 in the midst of another scandal of fines to pay and oil spills to remedy.

Of all these companies, Pluspetrol Norte has accumulated some of the highest fines for its operations. Mongabay Latam contacted the OEFA, which said that “in Block 8 and in Block 192 (formerly Block 1AB), Pluspetrol is obligated to comply with the imposed administrative measures, some [of which] referring to the remediation of the areas impacted by its activity. In the case of Block 8, Peru’s Ministry of Energy and Mines is evaluating the Abandonment Plan, which must contain the remediation agreements in the area.”

Due to the debt accumulated after being fined by the Peruvian government, Pluspetrol is facing a judicial process with the OEFA, according to Patricia Tipiani from the Bureau of Environment, Public Services, and Indigenous Communities, which is part of the Ombudsman’s Office. The OEFA told Mongabay Latam that “the Public Prosecutor of the OEFA registered 40 trials for Block 8 and another 20 for Block 192 (formerly 1AB) for the alleged crime of environmental pollution, which have been rerouted to the Specialized Public Prosecutor of the Ministry of the Environment.”

Using the database compiled for the #ManchadosXElPetróleo special series, Mongabay Latam was able to trace Pluspetrol Norte’s history of fines and sanctions. In Block 192, the oil company received nine sanctions from the OEFA between 2012 and 2015, its last three years of operations. The reports highlight offenses like the failure to maintain the pipeline by neglecting to periodically check the aging pipes. Other issues that the OEFA considers to be serious offenses are the failure to make use of suitable environmental management tools and the lack of environmental remediation in areas impacted by oil-related activity. By 2015, the company had accumulated over $3 million in fines.

Despite this evidence, Peru’s Court did not rule in favor of the OEFA in the current trial with the oil company. “From what we understand, it will be appealed. For our part, we have recommended that the Ministry of Energy and Mines address this issue and that those companies that have confirmed sanctions–that they refuse to pay–can no longer sign contracts with the government,” says Tipiani from the Ombudsman’s Office.

The Indigenous communities have not stopped denouncing the consequences of the crude oil pollution. “The land is contaminated [and] sometimes we get sick; we feel dizzy, get stomachaches, but nobody gives us a reason,” says Sandi, the environmental monitor for the community of José Olaya. A toxicological study conducted by the Center for Occupational and Environmental Health (CENSOPAS) in 2016, titled “Levels and risk factors of exposure to heavy metals and hydrocarbons in the residents of the communities of the Pastaza, Tigre, Corrientes, and Marañón river basins in the department of Loreto ,” supports Sandi’s arguments. Arsenic and lead were found in the drinking water at levels higher than the maximum allowed limits.

Carijano, the former Kichwa leader, recounts the story of Block 192 and Pluspetrol with outrage. He was denounced by Pluspetrol and by the government for his participation in protests in 2008. That year, Quechua and Kichwa leaders took over Block 192, demanding a stop to its activity in a symbolic instance of mobilization against oil companies in Peru. “Although the accusation against the Quechua [people] did not succeed, the other process against the Kichwa has followed its course, to the point that it was formalized in 2017 and the trial begins this year. They are asking for 37 years in prison and civil reparations to the company. It is a case of criminalization, of intimidating leaders,” says Pita, the specialist from PUINAMUDT.

The accusations against Carijano and 20 other Indigenous community members that appear in the record include aggravated robbery, kidnapping, and possession of weapons. The Public Prosecutor is demanding about $132,000 and 31 years in prison, according to Dorian Choque, the defense attorney for the case. The process is in the hands of the Second Liquidation Courtroom of the Superior Justice Court of Loreto.

“It is a very weak accusation; there is not sufficient evidence to generate a presumption of crime. No investigation has been done with evidence to strengthen the accusations. They have not even been guaranteed the right to defend themselves and the notifications did not reach them. However, the lawyers of Pluspetrol Norte have appeared; they are still pursuing the case,” says Choque.

Carijano says that this is one more case of criminalization. “We have not done anything to anyone. We have not damaged any property. We have a trial now, and our community remains unchanged. It has not been remedied; we are worse off,” says the former Kichwa leader.

The same story in Block 8?

Apu Omar Saquiray, the president of FECONACOR, no longer knows who to complain to about the damage to his people’s lands and about what he considers to be continuous suffering. He has attended countless meetings with leaders and government entities and has even spoken with the OEFA. However, he says that the spilled oil is still present in the water and the land.

Unfortunately, Saquiray’s concerns are still unaddressed: he highlights that the company’s list of environmental offenses is growing. A total of 49 fines imposed by the OEFA are listed in the #ManchadosXElPetróleo database, which documents the environmental crimes and offenses of Pluspetrol Norte in Block 8. The reasons for the sanctions include the failure to adopt preventative measures to avoid negative impacts when a spill occurs, the failure to complete decontamination of the areas affected by the crude oil, and the failure to comply with remediation activities for four sites contaminated by hydrocarbons, among others. By 2020, the company had accumulated over $32 million in fines.

Block 8 has been active since 1970 and was operated by Petroperu from 1971 to 1996. It was then concessioned to Pluspetrol Norte. This company stopped operations in 2021, although its contract ended only in 2024 and the remediation of the environmental liabilities that it had accumulated in its 25 years of operation in the area were still pending. Pluspetrol Norte, according to the OEFA, not only seeks to avoid its obligation to tend to its environmental liabilities in Block 8; there is also a risk that with the liquidation of the company, there will not be a way to demand the payment of the fines. For this reason, the Ombudsman’s Office also made a ruling on this case in February 2021.

“Perupetro presented a preventative measure against Pluspetrol Norte to prevent this liquidation from occurring and told us that it conducted an arbitration process in front of the International Chamber of Commerce. According to the contract, it was the way to resolve the controversies that could come up and, among them [was] this exact liquidation announcement,” says Tipiani of the Ombudsman’s Office, who is also worried about the health of the Indigenous people, since she believes that neither the company nor the government have taken measures to protect their lives.

Mongabay Latam consulted the OEFA about this exact case. The response what that “Pluspetrol has acted in bad faith by agreeing to its own dissolution with the goal of alleging that said situation generated the resolution of the Contract. By doing so, the company plans to release itself from its contractual and legal obligations of remediation and compliance with the Abandonment Plan for Block 8.”

The report “Para prender el silencio: Historia de olvidos, tecnicismos y daños petroleros en el Lote 8,” (“Turning on the silence: A history of oversights, technicalities and oil damage in Block 8”) edited by the Amazonian Center for Anthropology and Practical Application (CAAAP in Spanish) and published last year, says that “in the last 22 years, the government’s auditing entities have found an extremely high and alarming number of spills in Block 8, totaling 181 spills.”

For that reason, Apu Saquiray expresses his irritation. “This situation bothers us as native people; we cannot live peacefully, we always have to be sick, [and] there is always news of a spill here or there, or of puddles of oil accumulating for years. We have had meetings with Perupetro [and] with the Ministries, and it is not resolved,” says Saquiray. “With Pluspetrol in the process of liquidation and without an Abandonment Plan, who will end up assuming the cost of these liabilities is the government, and that will have to come out of the pockets of Peruvians,” says Mario Zúñiga Lossio, an anthropologist from PUINAMUDT and member of the Federations of the Tigris and Pastaza River Basins.

When representatives from Pluspetrol Corporation’s communication department were asked about the liquidation process, they answered that they did not see anything related to Pluspetrol Norte. A company called Estratega Consultores, which currently appears in Peru’s National Superintendency of Tax Administration (SUNAT in Spanish) and took on the liquidation, also has not responded to Mongabay Latam’s questions.

“We [from the] communities are fed up because nobody takes responsibility. Pluspetrol has continued to contaminate us for years. The worst part is that we have brothers [who have been] criminally denounced for defending their rights and the company has [considered] them as groups of vandals,” says Apu Saquiray, who is part of the Achuar ethnic group.

Who is responsible for the damage?

The big dilemma involves determining who will eventually remedy these impacts and how the people exposed to the crude oil will recover. Miguel Lévano, a program coordinator for the Peruvian branch of the non-governmental organization Oxfam, explained that “many companies like Pluspetrol–to avoid paying fines–take them to court; that is legal.” Lévano added that “the worst [part] is that these sanctions, additionally, are low in comparison to the magnitude of the environmental damage.”

In the case of Pluspetrol Norte, the excess of $47 million it owes is not even close to the cost of repairing the areas affected by the oil.

“Imagine that at the OECD in Europe, Pluspetrol has refused a meeting with us, the Indigenous leaders; they do not want to take responsibility; they are not going to face the consequences,” says Apu Chino.

“The other major issue is that the sanctions are not used for remediation, but for income to the auditing entities themselves,” says Lévano. So the remediation falls on the company, which does not always utilize the best techniques or methods to avoid bigger environmental impacts. “The spill is covered by putting soil [and] placing plants; it can be dug into and oil is found underneath,” says Lévano.

The documentation, trials, and international proceedings between Pluspetrol Norte and the Peruvian government continue to accumulate while the affected Indigenous communities deplore the fact that those responsible do not respond to their claims, but simply disappear after leaving oil stains in the Amazon.

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