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WWW.GLOBALAWARE.ORG: Dossier on the OCP (Oleoducto de Crudos Pesados) pipeline in Ecuador:

Essays and reports on a controversial pipeline to take
crude oil from the Amazon to the Pacific Ocean.

The Price of Oil:

The Social and environmental cost of oil

By Dr. Leslie Jermyn

By Dr. LESLIE JERMYN © 2002
leslie@GlobalAware.org

Oil is the burning issue of our time. Plan Colombia, Alaska nature reserves, Kyoto protocol, Arizona forest fires and invasions of Iraq are all best understood as pieces in the petroleum puzzle. North America consumes as much of this precious substance as Africa, Central and South America and Asia (excluding Japan) combined. With just 6% of the world’s population, we consume 30% of its oil and our economy is intricately linked to a guaranteed affordable source of black gold. We complain bitterly when the price at the pumps goes up and our society is immobilized when there are shortages - remember the 1973 oil crisis that resulted from the formation of OPEC? That crisis forced us to rethink 8-cylinder gas guzzlers and impose mileage restrictions on auto makers. But they evaded the restrictions and lured us back to gas gluttony with Sport Utility Vehicles - the latest addition to the pantheon of symbols of Life, Liberty and the American Way of Life.

For the sake of oil, we will tolerate such unseemly and undemocratic allies as Saddam Hussein (before the Gulf War) and the Saudi Royal family who together hold 36% of the world’s proven reserves. For the sake of oil and the profits it generates, we will ransom the future of the planet by refusing to acknowledge the damage done by burning fossil fuels - this, even when our own forests burn down and towns flood due to global warming and climate change. In short, for the sake of our extravagant lifestyle, we are prepared to put up with any abuse of human rights or the planet we depend on.

The Other Side of the Coin

Oil has a different significance for those who have the misfortune to live in a ‘developing’ oil-producing country. In the small South American country of Ecuador, a consortium of international companies, including Los Angeles based Occidental Petroleum, is building a second oil pipeline from the Amazon Basin to the Pacific Coast. This pipeline, known as the OCP (Heavy Crude Pipeline), is causing widespread social disruption and will result in a massive assault on the remaining forests of Ecuador’s Amazon region.
The OCP was born in 2000 when President Noboa of Ecuador accepted the terms of an IMF loan that his country desperately needed. Ecuador’s existing pipeline was built by Texaco in 1972 and became state property in 1992. Private oil companies, like Occidental and Kerr McGee, had to pay the state a shipping fee to use the pipeline and they had long wanted to avoid this cost by constructing their own pipeline. The argument was made that the state would lose the shipping fee but would gain from job creation (52,000 jobs promised) and future revenue from increased oil production to fill the new pipeline. Under IMF pressure, Ecuador finally agreed to the deal and construction began in 2001.

Ecuadorians Protest

Along the route of the pipeline, Ecuadorians are resisting the immoral tactics of the OCP consortium. Amazonas Platform is the storage and pumping station in Sucumbíos province where heavy crude will be heated and treated for shipment down the pipe. The platform is located just 600m from the city of Lago Agrio and directly in the path of the city’s expansion. Máximo Abad, twice-elected mayor of Lago, has opposed the location of the platform since day one, “this installation will be a source of constant noise and chemical pollution and presents a clear risk to the population of this city.” The OCP argues that its decision was based solely on ‘technical merit.’ Abad fears that it was chosen so that the people of his city would form a “human shield” against possible terrorist attack and he wants the OCP to pay a higher price for this luxury in the form of much-needed social services.

In February, residents of Sucumbíos and Orellana, the provinces that produce the majority of Ecuador’s oil, went on strike. The people here are tired of “living like beggars in a bag of gold.” They have insufficient potable water, electricity cuts for up to eight hours a day (from diesel burning generators) and few paved roads while oil supplies 45% of national revenues. Protestors blocked roads and pressured oil workers to shut down facilities. President Noboa declared a state of emergency, ordering the army to quell the protest. Three civilians died – two of them children who were asphyxiated in teargas attacks.

At kilometres 6 and 8, just outside Lago Agrio, members of peasant cooperatives blocked OCP construction equipment in January 2002 to protest the way the OCP handled purchasing rights-of-way through their lands. One of the organizers, Jaime Cevallos explains, “They [OCP] never met with us as a community. They only met with our former leader and offered him a bribe to approve the right-of-way. They knew that we wanted more to make it worthwhile to live with this environmental and health hazard. Now we are asking not for more money but for a commitment to build a school and a health center but they won’t talk.” The former president of one cooperative took the money and ran leaving the people with nothing. The OCP says it has already paid and the peasants are just greedy.

Defending Nature

High up in the Western Andes, the OCP crosses the Mindo Nambillo Cloudforest Reserve where concerned citizens are trying to divert it. Many national and international environmental organizations do not oppose the pipeline, but argue that it should have gone south around Quito, the capital city, to avoid Mindo. The Director of Environment and Community Relations for OCP, Ray Kohut, says “the southern route is impossible and also impacts the Important Bird Area of which Mindo is a part.” What Mr. Kohut does not say is that the southern region is mostly deforested and not considered critical by conservationists. In contrast, Mindo lies within the Choco forest, one of the world’s most biodiverse areas and home to 450 species of birds, ten of which are globally threatened. Ian Davidson, Head of the Americas Division of Birdlife International, points out that the OCP Environmental Impact Assessment only properly evaluated the northern route. “This isn’t normal,” he says, “you usually analyze 2 or 3 routes in a project of this type before deciding on the best one. This process would not be acceptable in North America where some of the consortium members reside.”

Citizens of Mindo depend on nature tourism to make a living. In January, they occupied the ridge where the pipeline will do the most damage, hoping to form a human shield against the earth movers waiting below. Their campaign was successful for a few months because the rains prevented construction anyway. Then in late March, 60 soldiers raided the camp and took 17 protestors to jail. The arrest and jail sentence were declared unconstitutional and the protestors released on April 1. In a powerful plea for justice, the lawyer for their case, Julio Cesar Trujillo said “these young people were defending the patrimony of the human race against a company whose only interest is money.” The Mindo route shortens the pipeline and allows the company to avoid constructing an expensive pumping station. Williams International originally bid to construct the pipeline and offered to take a southern route for half the cost.

Assault on the Amazon

The new pipeline will only be worthwhile if there is oil to fill it. Private companies will have to double or triple their current production to do this. They are already doing seismic testing and drilling in Amazonian nature reserves and soon they will be constructing miles of feeder pipeline and oil rigs in these areas. Some indigenous groups, like the Shuar in Ecuador’s southern Amazon, have vowed to fight oil development with violence if necessary. They do not want their forest homes to be destroyed the way Texaco destroyed the northern Amazon. Juan Bosco, a Shuar spokesperson says “we know how oil works. It makes or breaks presidents here and it kills nature and people. We say ‘atsaá,’ ‘no’ in our language. We will go to the UN to demand our independence from Ecuador if we have to but the oil companies will not drill here.” Sadly, it is unlikely that Ecuador’s indigenous people will be able to resist the pressure of the insatiable demand for oil beyond their borders.

Some sobering facts

The combined volume of both pipelines working to capacity is 900,000 bpd. The state says the country has proven reserves of nearly 4 billion barrels and possible reserves of 6 billion barrels. That means that Ecuador will run out of oil in 12 to 18 years – two years short of when the OCP becomes Ecuadorian property. Only 3000 jobs have been created by the OCP and once construction is finished, only about 200 will remain - no where near the promised 52,000. Once the oil is gone, what will Ecuador have left of its natural and cultural heritage? How many Ecuadorians will have to kill their fellow citizens to protect our oil interests?

Bumper to bumper, one person to a car, we sit in endless traffic jams cursing one another. Meanwhile, we continue to design cities where cars are essential and underfund more efficient forms of transportation. I have to ask myself whether this abuse of resources is worth the lives of innocent people or the destruction of the planet we depend on?

by Dr. Leslie Jermyn
Published in Response Magazine, New York in November 2002.

Images available at photo@GlobalAware.org