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From the Editors:
With the northern part of Ecuador's Amazonian area thoroughly polluted, the oil companies are now turning their attention toward the south and east of the country.
As was noted in previous issues of this series, the government is preparing to auction off large blocks of territory in the Amazon to oil companies for exploration and exploitation. This will open up pristine new areas to oil development.
The scope and size of the new concessions have triggered tremendous protests in Ecuador. As a result, the auctions will probably be scaled back -- at least temporarily.
In the meantime, the invasion has already begun. Last summer, construction began on a new pipeline that will carry oil from the new fields in the Amazon to the coast.
There is an economic logic to this move. The existing pipeline is limited in the amount of oil it can transport and would certainly not be able to carry the amounts envisaged by the new round of leasing. This bottleneck, in turn, has limited foreign investment. If one accepts the rationale of oil development, as does Ecuador's government, then it becomes imperative to be able to transport more oil from the drilling fields to the refineries.
Some predict that the new pipeline could generate up to $3 billion of new investment, over and above the cost of construction. Moreover, the International Monetary Fund (IMF) is exerting pressure on the government to build the pipeline and has warned that if Ecuador does not go ahead with the construction project, it will lose access to promised loans.
But to the people of Ecuador, the new pipeline is another example of the way Ecuador has placed oil development before all else. Wildlife sanctuaries have already been threatened and indigenous communities ignored. At this moment, environmental activists are blocking construction of the new pipeline at Mindo, location of one of the most important bird sanctuaries in the Western Hemisphere.
Furthermore, there is the risk of spillage and pollution. The companies that work in Ecuador today are making efforts to keep the damage to a minimum and reduce the threat to the environment. But as Peter Lippman finds in the fourth issue of this series, there is no such thing as a risk-free pipeline.
Ecuador Steps Back from the Brink as Negotiations Begin
After nine days of increasingly violent confrontations, protestors have agreed to suspend the wave of strikes that have paralyzed the Amazon provinces of Sucumbios and Orellana.
The agreement between the Ecuadorian government and the protestors was drawn up last Monday in Quito. The two sides have signed on to a detailed plan to revive agriculture and develop the infrastructure in the northern Amazon. The government has also lifted the state of emergency, ended restrictions on civil liberties, and freed the approximately 40 demonstrators who had been arrested.
The settlement is seen as something of a victory for the protestors, whose activities resulted in the loss of more than $3 million in oil production. Mediators and representatives of the state bank and electrical industry attended the negotiations. Under the terms of the agreement, the government has promised massive support for the agriculture industry, including cash incentives for beleaguered coffee farmers. The government promised to purchase generators to solve the electrical shortage, and will also connect Orellana and Sucumbios to the national power grid. Funding was also promised to pave the main highways of the two provinces.
It remains to be decided what part of these projects will be funded by the consortium of companies that is constructing the new pipeline across Ecuador (OCP). Further negotiations regarding education, security, health, and the environment will be held in Lago Agrio and Coca in the coming weeks.
For now, it appears that order in the region has been restored. But one of the core problems that prompted nationwide protests last month -- privatization of the electrical distribution system -- could soon re-emerge. Sale of the electrical companies is set for mid-April. Popular organizations have called for renewed protests this week.
Meanwhile, smaller strikes continue around the country. In Canar province, protestors blocked the road between Guayaquil and Cuenca, the second and third largest cities in the country. They are demanding development funds for water and sewage systems. 'It is the only language that the central government understands,' said Jimmy Araujo, the Mayor of Troncal canton.
Risky Business: The Oil Industry in Ecuador
Texaco, Pioneer in Pollution
Texaco Oil Company, which worked in Ecuador from the 1960s until 1990, has been a prolific polluter of the Amazon. After several decades of occasional exploration by various international oil companies, Texaco discovered oil in the northern Oriente in 1967, between the Napo River and the border with Colombia. By the time it withdrew in 1990, Texaco had extracted nearly 1.5 billion barrels of oil from 300 wells.
From the time that Texaco began pumping oil out of the jungle, it violated every principle of environmental safety.
Waste pools. For every barrel of oil that is produced, there is another barrel of toxic 'production water' that must be disposed. These hazardous by-products of oil are normally reinserted deep into the ground, and Texaco holds a patent for reinsertion technology. In Ecuador, the company sought to save money -- several dollars a barrel -- by dumping the waste products into the jungle. Over 20 billion gallons of hazardous wastes, toxic drilling mud, and oil were poured into about 300 unlined oil basins. In most cases, these were little more than dugout pits in the forests and fields, such the ones around San Carlos.
The Ecuadorian government conducted studies of Texaco's oil wells in the late 1980s and determined that 80 percent of the company's waste pits were badly built and a source of continuous pollution. The studies also found high levels of grease and oil in 36 water samples taken near oil production sites. It appears that water carried the heavy metals and dangerous chemical by-products of the oil extraction process throughout the Amazon, causing an environmental hazard that reached all the way downstream to Peru.
Spillage. In 1972 Texaco built Ecuador's main Trans-Ecuadorian Pipeline (Sistema Oleoducto TransEcuatoriana, or SOTE). The pipeline runs from Lago Agrio in the northern Oriente over the Andes to Esmeraldas on the Pacific coast. This pipeline was so badly maintained that before Texaco pulled out of Ecuador, nearly 17 million gallons of oil had been lost in over 30 major spills. This far exceeded the 10.8 million gallons lost in the Exxon Valdez spill.
Burning off. Texaco burned off over billions of cubic feet of natural gas at refineries -- this in a gas-importing country -- further polluting the region and contributing to global warming.
Carrying on the Texaco Tradition
When residents of the Oriente became aware of the destruction that Texaco had caused to their environment and way of life, they organized against further such depredations. By the early 1990s Texaco was gone, and other oil companies that wanted to prospect in the Amazon had to move more carefully. But while their rhetoric was 'environmentally correct,' it turned out that their practices very often did not live up to acceptable standards of environmental safety.
For example, during the mid-1990s Maxus Oil Company was the holder of drilling rights for Block 16 in Orellana province. The company called its operations a 'model for oil development in the rainforest,' but in 1993 Maxus workers accidentally ruptured a pipeline and spilled 900 barrels of oil onto a road near the Napo River.
A much worse spill occurred at the beginning of 2001, when Ecuador's main SOTE pipeline spilled 10,000 barrels of crude oil into the Toachi River, 80 miles west of Quito. The state-owned oil company Petroecuador hinted at a bomb attack, but a Reuters news report quoted an oil expert, Rene Bucaram, as saying that the spill was due to poor management of the pipeline. Mr. Bucaram accused the government of tricking the public with excuses about a bombing and voiced the suspicion that the pipeline burst because too much oil was being pumped through it. [1]
Oil companies are not completely deaf to the issue. They know that they must present at least an appearance of concern for the environment. In an advertisement for a guidebook on hazardous waste disposal, the regional association of oil companies (Arpel) noted: 'Improper disposal is visible very quickly onshore -- and often offshore -- and will usually lead to prosecution and severe penalties.' The organization also noted the trend toward anti-pollution legislation around the world. [2]
It has become routine for oil companies to produce appealing public relations material that seeks to reassure the public. Petroecuador's web site asserts that the state-owned company is re-injecting 130,000 barrels of hazardous waste daily to a depth of 7,000 feet, and that they regularly clean thousands of cubic meters of contaminated soil. But Petroecuador and international oil companies continue to spill equally vast amounts of oil and hazardous wastes directly into the Amazon.
Controversy in Villano
Until recently, Arco Oil Company held the oil prospecting rights for Block 10 in western Pastaza province. Arco has a reputation for using safer practices in oil extraction, but this reputation is not necessarily justified.
In 1988, the California-based corporation purchased rights to Block 10 as majority partner in a consortium with the Italian-owned Agip Petroleum Ltd. The group created controversy almost immediately. In 1988 it cut paths through the forest for seismic testing without consulting the local people. Later, environmentalists warned that the path of the proposed flowline would cross five rivers in the area of the Curaray headwaters.
In 1992 Arco discovered oil at Villano in western Pastaza province. Instead of waiting for criticism, it unveiled a development plan that it said would emphasize conservation and protection of biodiversity.
This plan included advanced methods of pipeline construction and safer drilling techniques. Arco and Agip constructed a 40-kilometer flowline to link the drilling site up with Arco's central processing unit, near Puyo, without even building a road. The drilling site was built, and pumping of oil began in late 1998. In early 2000, Arco sold its stake in the project to its partner Agip and withdrew from Ecuador.
The Villano model was an important gesture to environmentalists, but it has not been smooth sailing. Residents in the area surrounding Villano began to complain even before pumping began. Heavy equipment that was being used to enlarge a road from Puyo toward the pipeline construction site was causing erosion and polluting streams. Environmental and indigenous organizations also joined in the criticism, alleging that the helicopters used to carry pipeline equipment into the construction zone were scaring away wildlife. Residents of nearby San Virgilio complained of illnesses that they said they had contracted from water polluted by the construction.
Francisco Vacas, public relations manager for Agip, denied charges of carelessness during an interview with the Advocacy Project. He said that Arco and Agip had spent millions to build an 'invisible' pipeline through the forest from the drilling installation at Villano. The pipeline was built in such a way as to minimize disturbance of the jungle's tree canopy, an important travel route for animals. Equipment for the pipeline was transported into the forest by helicopter, and a temporary monorail system was then constructed to bring in the pipe material. Trees that were in the way were felled with a special machine that cut one tree at a time and controlled the fall of the tree, so that damage to other trees was prevented. When the monorail was removed, the trail was reforested.
The oil wells were then drilled close together in a row to prevent having to create many installations throughout the forest. The well pipes drop down a distance and then veer off at angles to end up far away from their surface starting point. Once the oil is refined, Agip reinjects the hazardous by-products from Villano's oil deep into the ground.
Mr. Vacas describes the Villano installation as similar to an offshore oil platform, which is managed from the outside, with low environmental impact: 'The only thing we have at Villano is the well site, which is just that: the wells. There is no treatment plant or power generation.'
Skepticism Persists
The Advocacy Project was unable to travel to Villano for independent confirmation of Mr. Vacas's reassuring description. But in the summer of 1999, not long after Arco began pumping oil out of Villano, a geologist reported leaks on the flowline to Puyo, near the village of San Virgilio.
Simon Santi, who lived in the village and had worked for Arco as an environmental monitor, confirmed these reports to journalist Danielle Knight. [3] He said that he had reported four large leaks to the company but had been told not to mention the leaks in his report. Crude oil from one of these leaks was being washed by rain directly into the nearby Likino River, which is used by local people for fishing.
Several environmental activists with the Quito-based organization Accion Ecologica learned of these leaks from the villagers and went to inspect them in July 1999. They were detained overnight by the military and were never allowed to see the damage. The army had at this time increased its presence along the pipeline, leading to accusations by environmentalists that the region had become militarized. In return, military spokesmen accused environmental organizations of being 'leftists' and inciting trouble in the area.
At the time, Herb Vickers, a spokesman for Arco, was reported as denying that there were leaks in the flowline. He insisted that it had been built according to the highest environmental standards, and that his company monitored it daily. He said, 'Frankly, I don't see why environmentalists need to monitor the pipeline.' [3]
It is indisputable that the technology of oil extraction is safer than in the early days of Texaco's rampage. But in spite of the soothing claims of Mr. Vacas and other oil company spokesmen, the legacy of Texaco's disregard for the environment lives on. The Center for Economic and Social Rights notes that Petroecuador, the state oil company, still deposits 40 percent of its production water into the environment without treatment or reinjection. Without stronger enforcement and monitoring, technology alone will not stop the destruction of the Amazon.
Fight Over the New Pipeline
The oil companies are now turning their attention toward undeveloped oil sources in the southern part of the Oriente.
The first step in this drive into as-yet-unspoiled areas of the Amazon jungle is the construction of a new main oil pipeline, the OCP (Oleoducto de Crudos Pesados, or Heavy Crude Pipeline). The new pipeline is projected to double the transport capacity of the current pipeline system (SOTE), making it possible to expand oil exploration and drilling throughout the Oriente.
The new $1.1 billion pipeline project will follow the SOTE to the Andes and then diverge along a route through some of the most fragile ecosystems in Ecuador.
Construction of the OCP began in the summer of 2001 and is under way as this series goes out. Ecuador's Ministry of Energy asserts that it has selected a route for the pipeline that 'satisfies the objective of minimizing impact on the environment.' But the indigenous communities under whose land the oil lies have vigorously challenged this.
Environmentalists have also objected to the fact that the pipeline project was pushed through without due consultation with the people of Ecuador. A 1,500-page environmental impact statement was released a mere three weeks before the public review process was closed, leaving insufficient time for the project to be evaluated. The environmental study was criticized as careless and ambiguous in its proposals for measures to mitigate possible damage.
Activists in Quito filed a lawsuit to prevent the pipeline's approval because of lack of consultation with affected communities. But in May 2001, President Noboa declared, 'I'm not going to allow four mayors and a couple of jerks to screw the country. I'll give them war.' A few weeks later, the pipeline project was approved.
Damage to Eco-Tourism
There are several ways in which new pipeline is damaging. First, it will pass through highly environmentally sensitive regions of Ecuador, threatening serious damage. The route includes eleven natural reserves and 'protected' areas, including the Mindo Cloud Forest Reserve.
Mindo is a small Andean town not far from Quito, on the slope of Mt. Pichincha. It is home to over 450 species of birds, of which 10 percent are endangered species, and hundreds of varieties of orchids. In one 24-hour period, Audubon Society observers spotted a world-record 350 bird species -- indeed, many ornithologists consider Mindo the 'bird capital of the world.'
Construction of the pipeline will disrupt this bird life in the reserve and interrupt wildlife corridors. It will also damage a thriving eco-tourism industry that, according to Greenpeace International, is predicted to earn over $600 million in the next 20 years. Not surprisingly, this natural reserve is one of the most popular bird-watching sites in the Western Hemisphere, attracting as many as 50,000 tourists each year.
Activists have pointed out that the pipeline will also endanger the water supply of Quito, Ecuador's capital. The pipeline is routed to pass through several outlying sections of the city, where ruptures could pose a hazard to densely populated neighborhoods.
The second risk is that the pipeline could become a target of political attack. Hundreds of pipelines have been bombed in neighboring Colombia, and the existing Ecuadorian pipeline (SOTE) has already been bombed four times. The latest bombing, in December 2000, caused almost 3,000 barrels of oil to be spilled. Five people were killed, and 19 more wounded, in the incident.
It is not certain whether Colombians or Ecuadorians committed the bombings, but they amount to a clear protest against oil development. Political instability again spilled over into Ecuador in late February of 2001, when hundreds of people occupied four oil installations in Sucumbios and Orellana provinces, and temporarily shut down the existing pipeline. They were protesting insecurity along the border with Colombia.
Risk from Spillage
The third, and most serious, threat from the pipeline comes from spillage. Much of the soil over which the pipeline will pass is unstable, subject to earthquakes, landslides, or shifting. The pipeline route also crosses more than 60 earthquake faults and passes near six volcanoes, one of which has erupted recently.
A mudslide came down on the SOTE pipeline in June 2001, just as the OCP project was being approved, and caused a week-long closure. Seven thousand barrels of oil were spilled into the forest. Far from being a rare occurrence, this was the fourteenth major spill since 1998. In that three-year period, over 145,000 barrels of oil were spilled into the environment.
Given the instability of the land over which the OCP is to pass, construction of a new 500-kilometer pipeline will only provide more chances for spills to occur. As this issue of On the Record goes out, the pipeline is nearing 10 percent completion, and accidents have already occurred that caused serious damage to the environment.
Last November, as crews were working around Mindo, a fire broke out in the habitat of the Black-breasted Puffleg, whose entire world population of 250 birds lives in the part of Mindo through which the OCP is to pass. As OCP workers stood by, the fire destroyed 40 percent of one of only five roosting places for this species.
Local environmentalists and their supporters around the world have mounted resistance to the pipeline's construction, as described elsewhere in this series. In response, President Noboa, surpassing the arrogance of his previous statement, declared that environmental activists would rather 'defend the little butterflies, the hummingbirds, trees and forests,'' rather than defend human beings, ''which are the king of creation and everything in its domain.'' [4]
Greenpeace, BirdLife, Fundacion Natura, and many other environmental organizations have criticized the environmental impact studies carried out by the OCP as inadequate. We have seen that Arco and Agip, the oil companies with the strongest reputation for good environmental practices, are not up to the task of creating a safe 40-kilometer spur pipeline. It is to be expected that problems with the OCP will be vast in comparison.
Letter from Mindo
John Parnell, a North American radio technician, traveled to Ecuador with Amazon Watch last month to assist indigenous organizations in setting up remote communications systems. While there, he visited the Mindo Cloud Forest Reserve, where environmentalists have been blocking construction of the OCP pipeline. Authorities have threatened to evict them several times. The following excerpt is taken from a letter describing what he saw at Mindo:
'We were dropped off in a valley at the foot of the ridge. It was a brutal 3-mile hike up a muddy ridge with a 2000-ft. elevation gain carrying a 40-pound pack of techno toys, camping gear and food for the camp. The first part of the hike was up an access road created by the pipeline company. The final part was through a steep swath of slag that will (?) be the route of the pipeline. I was horrified to see the erosion caused by the road and the pipeline right-of-way; whole sections of the route have given way and washed large scars of mud down the steep hill into the green ravines. The engineers' plan is to stabilize the pipeline with 20-ft. steel pilings driven into the soil and to place the line on ridge tops to prevent them from being buried in landslides. Given the instability of the soil, the wet climate, and the nearby volcanic activity, this seems to be wishful thinking.
'We arrived in the camp huffing and puffing with sore legs and backs. We were met by eight activists: five Ecuadorians, a Finnish couple, and a French woman. I was impressed by the fact that the Ecuadorian activists have been living in this environment for almost four weeks.
'The cloud forest lives up to its name; there is a thick moist fog present almost all the time; even under the tarps the mist creeps in and leaves everything wet. Making a meal is a struggle, to keep a fire going with the heavy wet wood. Their drinking water is collected from the pools that form on the low spots of tarps. Maintaining the basics of living is a full-time job.
'Later we went to shoot video of the tree-sit further up the ridge. There are five trees that are set up with tent-covered platforms on which the activists sleep. Between two of the trees is a large banner that reads 'OCP NO PASARA' (translation: 'OCP will not pass').
'We hiked down the next day. At the pickup point, we were met by an activist who gave us the news that the pipeline company secured an order from the government to evict the blockaders. An alarm went out and several truckloads of activists from Mindo and Quito arrived to hike up in the dark in the pouring rain to reinforce the blockade with 20 more bodies. We went to Mindo to set up a communications center, make phone calls, and send e-mails from a sympathetic eco-tourist resort. The news came in that the police were starting up the hill, and we had not heard from our contact who stayed behind at the drop off point, so we assumed that he was arrested.
'Finally, when it looked like all was lost, the news came in that the report of police ascending the hill was a false alarm; someone had mistaken a crew van for a police squad. But the order to evict was NOT a false rumor, so it was a good thing that the camp was reinforced.'
References and Resources
[1]. 'Ecuador oil pipeline bursts, spills oil into river'
[2]. Waste disposal: http://www.arpel.org/products-4.htm
[3]. Arco Flow Line Leaks on Likino River: http://www.unii.net/confeniae/english/news/military-detain.html
[4]. 'Minister Speaks Out against Oil Pipeline' http://www.oneworld.org/ips2/may01/02_03_006.html
For additional background, see:
Glossary
Block--A concessionary piece of territory where exploration and drilling rights are leased by the Ecuadorian government to an oil company.
CONAIE--Confederation of Indigenous Nationalities of the Amazon, led by Antonio Vargas.
CONFENIAE--Confederation of the Nationalities Indigenous to the Amazon of Ecuador.
FDA--Amazon Defense Front (Frente de Defensa de la Amazonia).
HUAORANI, ZAPARA, SIONA, COFAN, AND SECOYA--Pre-Incan indigenous communities of Ecuador whose numbers are threatened by oil development.
IMF--International Monetary Fund.
Manta-- Port city on the Pacific, location of U.S. air base covering operations for Plan Colombia.
Mindo-- A small Andean town not far from Quito, on the slope of Mt. Pichincha. Location of the Mindo Cloud Forest Reserve, through which the new pipeline is set to pass.
OCP--Oleoducto de Crudos Pesados, the consortium of companies that is constructing the new pipeline across Ecuador.
OPIP--Organization of Indigenous Peoples of Pastaza.
Oriente--The Ecuadorian Amazon; eastern half of Ecuador.
Pastaza--A central province of the Oriente.
Plan Colombia--An economic and military plan to eradicate drug activity in Colombia and strengthen the state. The United States has contributed $1.3 billion to this plan since 2000. Spillover effects are being felt in Ecuador.
Yasuni Park--A national park in the central Oriente inhabited by Huaorani; part of it is protected.
In the next issue: Legal Battles
Issue 4: Risky Business: the Oil Industry in Ecuador
On the Record - The Fight for the Amazon
Vol. 16, Iss. 4
March 8, 2001
Risky Business: The Oil Industry in Ecuador
Contents:
- In the News: Ecuador Steps Back from the Brink as Negotiations Begin
- Risky Business: The Oil Industry in Ecuador
- Texaco, Pioneer in Pollution
- Carrying on the Texaco Tradition
- Controversy in Villano
- Skepticism Persists
- Fight Over the New Pipeline
- Damage to Eco-Tourism
- Risk from Spillage
- Letter from Mindo
- References and Resources
- Glossary
From the Editors:
With the northern part of Ecuador's Amazonian area thoroughly polluted, the oil companies are now turning their attention toward the south and east of the country.
As was noted in previous issues of this series, the government is preparing to auction off large blocks of territory in the Amazon to oil companies for exploration and exploitation. This will open up pristine new areas to oil development.
The scope and size of the new concessions have triggered tremendous protests in Ecuador. As a result, the auctions will probably be scaled back -- at least temporarily.
In the meantime, the invasion has already begun. Last summer, construction began on a new pipeline that will carry oil from the new fields in the Amazon to the coast.
There is an economic logic to this move. The existing pipeline is limited in the amount of oil it can transport and would certainly not be able to carry the amounts envisaged by the new round of leasing. This bottleneck, in turn, has limited foreign investment. If one accepts the rationale of oil development, as does Ecuador's government, then it becomes imperative to be able to transport more oil from the drilling fields to the refineries.
Some predict that the new pipeline could generate up to $3 billion of new investment, over and above the cost of construction. Moreover, the International Monetary Fund (IMF) is exerting pressure on the government to build the pipeline and has warned that if Ecuador does not go ahead with the construction project, it will lose access to promised loans.
But to the people of Ecuador, the new pipeline is another example of the way Ecuador has placed oil development before all else. Wildlife sanctuaries have already been threatened and indigenous communities ignored. At this moment, environmental activists are blocking construction of the new pipeline at Mindo, location of one of the most important bird sanctuaries in the Western Hemisphere.
Furthermore, there is the risk of spillage and pollution. The companies that work in Ecuador today are making efforts to keep the damage to a minimum and reduce the threat to the environment. But as Peter Lippman finds in the fourth issue of this series, there is no such thing as a risk-free pipeline.
Ecuador Steps Back from the Brink as Negotiations Begin
After nine days of increasingly violent confrontations, protestors have agreed to suspend the wave of strikes that have paralyzed the Amazon provinces of Sucumbios and Orellana.
The agreement between the Ecuadorian government and the protestors was drawn up last Monday in Quito. The two sides have signed on to a detailed plan to revive agriculture and develop the infrastructure in the northern Amazon. The government has also lifted the state of emergency, ended restrictions on civil liberties, and freed the approximately 40 demonstrators who had been arrested.
The settlement is seen as something of a victory for the protestors, whose activities resulted in the loss of more than $3 million in oil production. Mediators and representatives of the state bank and electrical industry attended the negotiations. Under the terms of the agreement, the government has promised massive support for the agriculture industry, including cash incentives for beleaguered coffee farmers. The government promised to purchase generators to solve the electrical shortage, and will also connect Orellana and Sucumbios to the national power grid. Funding was also promised to pave the main highways of the two provinces.
It remains to be decided what part of these projects will be funded by the consortium of companies that is constructing the new pipeline across Ecuador (OCP). Further negotiations regarding education, security, health, and the environment will be held in Lago Agrio and Coca in the coming weeks.
For now, it appears that order in the region has been restored. But one of the core problems that prompted nationwide protests last month -- privatization of the electrical distribution system -- could soon re-emerge. Sale of the electrical companies is set for mid-April. Popular organizations have called for renewed protests this week.
Meanwhile, smaller strikes continue around the country. In Canar province, protestors blocked the road between Guayaquil and Cuenca, the second and third largest cities in the country. They are demanding development funds for water and sewage systems. 'It is the only language that the central government understands,' said Jimmy Araujo, the Mayor of Troncal canton.
Risky Business: The Oil Industry in Ecuador
Texaco, Pioneer in Pollution
Texaco Oil Company, which worked in Ecuador from the 1960s until 1990, has been a prolific polluter of the Amazon. After several decades of occasional exploration by various international oil companies, Texaco discovered oil in the northern Oriente in 1967, between the Napo River and the border with Colombia. By the time it withdrew in 1990, Texaco had extracted nearly 1.5 billion barrels of oil from 300 wells.
From the time that Texaco began pumping oil out of the jungle, it violated every principle of environmental safety.
Waste pools. For every barrel of oil that is produced, there is another barrel of toxic 'production water' that must be disposed. These hazardous by-products of oil are normally reinserted deep into the ground, and Texaco holds a patent for reinsertion technology. In Ecuador, the company sought to save money -- several dollars a barrel -- by dumping the waste products into the jungle. Over 20 billion gallons of hazardous wastes, toxic drilling mud, and oil were poured into about 300 unlined oil basins. In most cases, these were little more than dugout pits in the forests and fields, such the ones around San Carlos.
The Ecuadorian government conducted studies of Texaco's oil wells in the late 1980s and determined that 80 percent of the company's waste pits were badly built and a source of continuous pollution. The studies also found high levels of grease and oil in 36 water samples taken near oil production sites. It appears that water carried the heavy metals and dangerous chemical by-products of the oil extraction process throughout the Amazon, causing an environmental hazard that reached all the way downstream to Peru.
Spillage. In 1972 Texaco built Ecuador's main Trans-Ecuadorian Pipeline (Sistema Oleoducto TransEcuatoriana, or SOTE). The pipeline runs from Lago Agrio in the northern Oriente over the Andes to Esmeraldas on the Pacific coast. This pipeline was so badly maintained that before Texaco pulled out of Ecuador, nearly 17 million gallons of oil had been lost in over 30 major spills. This far exceeded the 10.8 million gallons lost in the Exxon Valdez spill.
Burning off. Texaco burned off over billions of cubic feet of natural gas at refineries -- this in a gas-importing country -- further polluting the region and contributing to global warming.
Carrying on the Texaco Tradition
When residents of the Oriente became aware of the destruction that Texaco had caused to their environment and way of life, they organized against further such depredations. By the early 1990s Texaco was gone, and other oil companies that wanted to prospect in the Amazon had to move more carefully. But while their rhetoric was 'environmentally correct,' it turned out that their practices very often did not live up to acceptable standards of environmental safety.
For example, during the mid-1990s Maxus Oil Company was the holder of drilling rights for Block 16 in Orellana province. The company called its operations a 'model for oil development in the rainforest,' but in 1993 Maxus workers accidentally ruptured a pipeline and spilled 900 barrels of oil onto a road near the Napo River.
A much worse spill occurred at the beginning of 2001, when Ecuador's main SOTE pipeline spilled 10,000 barrels of crude oil into the Toachi River, 80 miles west of Quito. The state-owned oil company Petroecuador hinted at a bomb attack, but a Reuters news report quoted an oil expert, Rene Bucaram, as saying that the spill was due to poor management of the pipeline. Mr. Bucaram accused the government of tricking the public with excuses about a bombing and voiced the suspicion that the pipeline burst because too much oil was being pumped through it. [1]
Oil companies are not completely deaf to the issue. They know that they must present at least an appearance of concern for the environment. In an advertisement for a guidebook on hazardous waste disposal, the regional association of oil companies (Arpel) noted: 'Improper disposal is visible very quickly onshore -- and often offshore -- and will usually lead to prosecution and severe penalties.' The organization also noted the trend toward anti-pollution legislation around the world. [2]
It has become routine for oil companies to produce appealing public relations material that seeks to reassure the public. Petroecuador's web site asserts that the state-owned company is re-injecting 130,000 barrels of hazardous waste daily to a depth of 7,000 feet, and that they regularly clean thousands of cubic meters of contaminated soil. But Petroecuador and international oil companies continue to spill equally vast amounts of oil and hazardous wastes directly into the Amazon.
Controversy in Villano
Until recently, Arco Oil Company held the oil prospecting rights for Block 10 in western Pastaza province. Arco has a reputation for using safer practices in oil extraction, but this reputation is not necessarily justified.
In 1988, the California-based corporation purchased rights to Block 10 as majority partner in a consortium with the Italian-owned Agip Petroleum Ltd. The group created controversy almost immediately. In 1988 it cut paths through the forest for seismic testing without consulting the local people. Later, environmentalists warned that the path of the proposed flowline would cross five rivers in the area of the Curaray headwaters.
In 1992 Arco discovered oil at Villano in western Pastaza province. Instead of waiting for criticism, it unveiled a development plan that it said would emphasize conservation and protection of biodiversity.
This plan included advanced methods of pipeline construction and safer drilling techniques. Arco and Agip constructed a 40-kilometer flowline to link the drilling site up with Arco's central processing unit, near Puyo, without even building a road. The drilling site was built, and pumping of oil began in late 1998. In early 2000, Arco sold its stake in the project to its partner Agip and withdrew from Ecuador.
The Villano model was an important gesture to environmentalists, but it has not been smooth sailing. Residents in the area surrounding Villano began to complain even before pumping began. Heavy equipment that was being used to enlarge a road from Puyo toward the pipeline construction site was causing erosion and polluting streams. Environmental and indigenous organizations also joined in the criticism, alleging that the helicopters used to carry pipeline equipment into the construction zone were scaring away wildlife. Residents of nearby San Virgilio complained of illnesses that they said they had contracted from water polluted by the construction.
Francisco Vacas, public relations manager for Agip, denied charges of carelessness during an interview with the Advocacy Project. He said that Arco and Agip had spent millions to build an 'invisible' pipeline through the forest from the drilling installation at Villano. The pipeline was built in such a way as to minimize disturbance of the jungle's tree canopy, an important travel route for animals. Equipment for the pipeline was transported into the forest by helicopter, and a temporary monorail system was then constructed to bring in the pipe material. Trees that were in the way were felled with a special machine that cut one tree at a time and controlled the fall of the tree, so that damage to other trees was prevented. When the monorail was removed, the trail was reforested.
The oil wells were then drilled close together in a row to prevent having to create many installations throughout the forest. The well pipes drop down a distance and then veer off at angles to end up far away from their surface starting point. Once the oil is refined, Agip reinjects the hazardous by-products from Villano's oil deep into the ground.
Mr. Vacas describes the Villano installation as similar to an offshore oil platform, which is managed from the outside, with low environmental impact: 'The only thing we have at Villano is the well site, which is just that: the wells. There is no treatment plant or power generation.'
Skepticism Persists
The Advocacy Project was unable to travel to Villano for independent confirmation of Mr. Vacas's reassuring description. But in the summer of 1999, not long after Arco began pumping oil out of Villano, a geologist reported leaks on the flowline to Puyo, near the village of San Virgilio.
Simon Santi, who lived in the village and had worked for Arco as an environmental monitor, confirmed these reports to journalist Danielle Knight. [3] He said that he had reported four large leaks to the company but had been told not to mention the leaks in his report. Crude oil from one of these leaks was being washed by rain directly into the nearby Likino River, which is used by local people for fishing.
Several environmental activists with the Quito-based organization Accion Ecologica learned of these leaks from the villagers and went to inspect them in July 1999. They were detained overnight by the military and were never allowed to see the damage. The army had at this time increased its presence along the pipeline, leading to accusations by environmentalists that the region had become militarized. In return, military spokesmen accused environmental organizations of being 'leftists' and inciting trouble in the area.
At the time, Herb Vickers, a spokesman for Arco, was reported as denying that there were leaks in the flowline. He insisted that it had been built according to the highest environmental standards, and that his company monitored it daily. He said, 'Frankly, I don't see why environmentalists need to monitor the pipeline.' [3]
It is indisputable that the technology of oil extraction is safer than in the early days of Texaco's rampage. But in spite of the soothing claims of Mr. Vacas and other oil company spokesmen, the legacy of Texaco's disregard for the environment lives on. The Center for Economic and Social Rights notes that Petroecuador, the state oil company, still deposits 40 percent of its production water into the environment without treatment or reinjection. Without stronger enforcement and monitoring, technology alone will not stop the destruction of the Amazon.
Fight Over the New Pipeline
The oil companies are now turning their attention toward undeveloped oil sources in the southern part of the Oriente.
The first step in this drive into as-yet-unspoiled areas of the Amazon jungle is the construction of a new main oil pipeline, the OCP (Oleoducto de Crudos Pesados, or Heavy Crude Pipeline). The new pipeline is projected to double the transport capacity of the current pipeline system (SOTE), making it possible to expand oil exploration and drilling throughout the Oriente.
The new $1.1 billion pipeline project will follow the SOTE to the Andes and then diverge along a route through some of the most fragile ecosystems in Ecuador.
Construction of the OCP began in the summer of 2001 and is under way as this series goes out. Ecuador's Ministry of Energy asserts that it has selected a route for the pipeline that 'satisfies the objective of minimizing impact on the environment.' But the indigenous communities under whose land the oil lies have vigorously challenged this.
Environmentalists have also objected to the fact that the pipeline project was pushed through without due consultation with the people of Ecuador. A 1,500-page environmental impact statement was released a mere three weeks before the public review process was closed, leaving insufficient time for the project to be evaluated. The environmental study was criticized as careless and ambiguous in its proposals for measures to mitigate possible damage.
Activists in Quito filed a lawsuit to prevent the pipeline's approval because of lack of consultation with affected communities. But in May 2001, President Noboa declared, 'I'm not going to allow four mayors and a couple of jerks to screw the country. I'll give them war.' A few weeks later, the pipeline project was approved.
Damage to Eco-Tourism
There are several ways in which new pipeline is damaging. First, it will pass through highly environmentally sensitive regions of Ecuador, threatening serious damage. The route includes eleven natural reserves and 'protected' areas, including the Mindo Cloud Forest Reserve.
Mindo is a small Andean town not far from Quito, on the slope of Mt. Pichincha. It is home to over 450 species of birds, of which 10 percent are endangered species, and hundreds of varieties of orchids. In one 24-hour period, Audubon Society observers spotted a world-record 350 bird species -- indeed, many ornithologists consider Mindo the 'bird capital of the world.'
Construction of the pipeline will disrupt this bird life in the reserve and interrupt wildlife corridors. It will also damage a thriving eco-tourism industry that, according to Greenpeace International, is predicted to earn over $600 million in the next 20 years. Not surprisingly, this natural reserve is one of the most popular bird-watching sites in the Western Hemisphere, attracting as many as 50,000 tourists each year.
Activists have pointed out that the pipeline will also endanger the water supply of Quito, Ecuador's capital. The pipeline is routed to pass through several outlying sections of the city, where ruptures could pose a hazard to densely populated neighborhoods.
The second risk is that the pipeline could become a target of political attack. Hundreds of pipelines have been bombed in neighboring Colombia, and the existing Ecuadorian pipeline (SOTE) has already been bombed four times. The latest bombing, in December 2000, caused almost 3,000 barrels of oil to be spilled. Five people were killed, and 19 more wounded, in the incident.
It is not certain whether Colombians or Ecuadorians committed the bombings, but they amount to a clear protest against oil development. Political instability again spilled over into Ecuador in late February of 2001, when hundreds of people occupied four oil installations in Sucumbios and Orellana provinces, and temporarily shut down the existing pipeline. They were protesting insecurity along the border with Colombia.
Risk from Spillage
The third, and most serious, threat from the pipeline comes from spillage. Much of the soil over which the pipeline will pass is unstable, subject to earthquakes, landslides, or shifting. The pipeline route also crosses more than 60 earthquake faults and passes near six volcanoes, one of which has erupted recently.
A mudslide came down on the SOTE pipeline in June 2001, just as the OCP project was being approved, and caused a week-long closure. Seven thousand barrels of oil were spilled into the forest. Far from being a rare occurrence, this was the fourteenth major spill since 1998. In that three-year period, over 145,000 barrels of oil were spilled into the environment.
Given the instability of the land over which the OCP is to pass, construction of a new 500-kilometer pipeline will only provide more chances for spills to occur. As this issue of On the Record goes out, the pipeline is nearing 10 percent completion, and accidents have already occurred that caused serious damage to the environment.
Last November, as crews were working around Mindo, a fire broke out in the habitat of the Black-breasted Puffleg, whose entire world population of 250 birds lives in the part of Mindo through which the OCP is to pass. As OCP workers stood by, the fire destroyed 40 percent of one of only five roosting places for this species.
Local environmentalists and their supporters around the world have mounted resistance to the pipeline's construction, as described elsewhere in this series. In response, President Noboa, surpassing the arrogance of his previous statement, declared that environmental activists would rather 'defend the little butterflies, the hummingbirds, trees and forests,'' rather than defend human beings, ''which are the king of creation and everything in its domain.'' [4]
Greenpeace, BirdLife, Fundacion Natura, and many other environmental organizations have criticized the environmental impact studies carried out by the OCP as inadequate. We have seen that Arco and Agip, the oil companies with the strongest reputation for good environmental practices, are not up to the task of creating a safe 40-kilometer spur pipeline. It is to be expected that problems with the OCP will be vast in comparison.
Letter from Mindo
John Parnell, a North American radio technician, traveled to Ecuador with Amazon Watch last month to assist indigenous organizations in setting up remote communications systems. While there, he visited the Mindo Cloud Forest Reserve, where environmentalists have been blocking construction of the OCP pipeline. Authorities have threatened to evict them several times. The following excerpt is taken from a letter describing what he saw at Mindo:
'We were dropped off in a valley at the foot of the ridge. It was a brutal 3-mile hike up a muddy ridge with a 2000-ft. elevation gain carrying a 40-pound pack of techno toys, camping gear and food for the camp. The first part of the hike was up an access road created by the pipeline company. The final part was through a steep swath of slag that will (?) be the route of the pipeline. I was horrified to see the erosion caused by the road and the pipeline right-of-way; whole sections of the route have given way and washed large scars of mud down the steep hill into the green ravines. The engineers' plan is to stabilize the pipeline with 20-ft. steel pilings driven into the soil and to place the line on ridge tops to prevent them from being buried in landslides. Given the instability of the soil, the wet climate, and the nearby volcanic activity, this seems to be wishful thinking.
'We arrived in the camp huffing and puffing with sore legs and backs. We were met by eight activists: five Ecuadorians, a Finnish couple, and a French woman. I was impressed by the fact that the Ecuadorian activists have been living in this environment for almost four weeks.
'The cloud forest lives up to its name; there is a thick moist fog present almost all the time; even under the tarps the mist creeps in and leaves everything wet. Making a meal is a struggle, to keep a fire going with the heavy wet wood. Their drinking water is collected from the pools that form on the low spots of tarps. Maintaining the basics of living is a full-time job.
'Later we went to shoot video of the tree-sit further up the ridge. There are five trees that are set up with tent-covered platforms on which the activists sleep. Between two of the trees is a large banner that reads 'OCP NO PASARA' (translation: 'OCP will not pass').
'We hiked down the next day. At the pickup point, we were met by an activist who gave us the news that the pipeline company secured an order from the government to evict the blockaders. An alarm went out and several truckloads of activists from Mindo and Quito arrived to hike up in the dark in the pouring rain to reinforce the blockade with 20 more bodies. We went to Mindo to set up a communications center, make phone calls, and send e-mails from a sympathetic eco-tourist resort. The news came in that the police were starting up the hill, and we had not heard from our contact who stayed behind at the drop off point, so we assumed that he was arrested.
'Finally, when it looked like all was lost, the news came in that the report of police ascending the hill was a false alarm; someone had mistaken a crew van for a police squad. But the order to evict was NOT a false rumor, so it was a good thing that the camp was reinforced.'
References and Resources
[1]. 'Ecuador oil pipeline bursts, spills oil into river'
[2]. Waste disposal: http://www.arpel.org/products-4.htm
[3]. Arco Flow Line Leaks on Likino River: http://www.unii.net/confeniae/english/news/military-detain.html
[4]. 'Minister Speaks Out against Oil Pipeline' http://www.oneworld.org/ips2/may01/02_03_006.html
For additional background, see:
- See the Amazon Watch website, which reports on pipeline and other rainforest issues.
- Rainforest Action Network's website.
- For a very useful map of Ecuador with provinces, towns, indigenous areas, and the block system, see the PetroEcuador website. Click on 'mapas,' then on 'Mapa Catastral,' then on 'Provincias,' 'Bloques,' and 'Novena Ronda' (Ninth Round).
- For more sources see our Ecuador resource list.
Glossary
Block--A concessionary piece of territory where exploration and drilling rights are leased by the Ecuadorian government to an oil company.
CONAIE--Confederation of Indigenous Nationalities of the Amazon, led by Antonio Vargas.
CONFENIAE--Confederation of the Nationalities Indigenous to the Amazon of Ecuador.
FDA--Amazon Defense Front (Frente de Defensa de la Amazonia).
HUAORANI, ZAPARA, SIONA, COFAN, AND SECOYA--Pre-Incan indigenous communities of Ecuador whose numbers are threatened by oil development.
IMF--International Monetary Fund.
Manta-- Port city on the Pacific, location of U.S. air base covering operations for Plan Colombia.
Mindo-- A small Andean town not far from Quito, on the slope of Mt. Pichincha. Location of the Mindo Cloud Forest Reserve, through which the new pipeline is set to pass.
OCP--Oleoducto de Crudos Pesados, the consortium of companies that is constructing the new pipeline across Ecuador.
OPIP--Organization of Indigenous Peoples of Pastaza.
Oriente--The Ecuadorian Amazon; eastern half of Ecuador.
Pastaza--A central province of the Oriente.
Plan Colombia--An economic and military plan to eradicate drug activity in Colombia and strengthen the state. The United States has contributed $1.3 billion to this plan since 2000. Spillover effects are being felt in Ecuador.
Yasuni Park--A national park in the central Oriente inhabited by Huaorani; part of it is protected.
In the next issue: Legal Battles
Back
- News Service
- Multimedia
- Global Issues
- On The Record Archive
- Youth Against AIDS
- Palestine - Civil Society Under Siege
- Bosnia - Postwar Refugee Return
- Ecuador – The Fight for the Amazon
- Issue 1: Series Launch
- Issue 2: Ecuador's Troubled History
- Issue 3: The Poisoning of San Carlos
- Issue 4: Risky Business: the Oil Industry in Ecuador
- Issue 5: Legal Battles
- Issue 6: The Dilemma of Negotiating with Oil Companies
- Issue 7: Profiles of Resistance
- Issue 8: Profiles of Resistance II
- Issue 9: The Colombia Connection
- Issue 10: Debt and Development
- Issue 11: Democratizing Communications for Ecuador
- Kosovo – The Birth and Rebirth of Civil Society
- Nigeria – Girls for Sale
- Kosovo – Rebuilding After the War
- Cambodia - Civil Society and the Tribunal
- Central America - Life After Hurricane Mitch
- Guatemala – The Rio Negro Campaign
- Southeast Asia – Violence Against Women
- Covering the UN
- Civil Society in Albania
- Afghanistan's Women & Girls
- Africa – Pygmies
- Bangladesh – Empowering the Blind
- Bosnia – War and Recovery
- Ecuador and Oil
- Guatemala – Indigenous Advocacy
- India – The Global Movement for Children
- Kosovo – Civil Society after the War
- Nepal – Democracy and Discrimination
- Nigeria – Trafficking to Europe
- Occupied Palestinian Territories
- Peru – The Search for Truth and Justice
- Roma and Gypsies
- Serbia – Fighting Repression
- Sri Lanka – Rebuilding After the Tsunami
- The World Bank and Human Rights
- UK Travellers and Dale Farm
- AP Diaries and Staff Blogs
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