Politics of Poverty

Righting the many wrongs at Peru’s polluted oil Block 192

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Indigenous leaders living adjacent to petroleum block 192 in northern Peru are standing up to industry interests. Photo: Julie Byrnes / Oxfam in Peru

Industry interests have trampled on indigenous rights for decades in the Amazon. Does a recent victory for prior consultation signal a departure from oil business-as-usual?

On September 15, 2018 indigenous federations from the Amazonian Loreto region of northern Peru scored a small victory in the fight for community rights. Representatives from four federations signed an agreement with the Peruvian government and the state-owned enterprise PetroPerú that acknowledges prior consultation as part of the new contracting process for petroleum Block 192. Under the new agreement, Block 192 will undergo a community consultation process before PetroPerú awards a new contract for operating the oil field.

“The government has a quick timeframe to consult citizens and find a new strategic partner, but we are optimistic that the Peruvian government will honor its decision to defend prior consultation,” said Frank Boeren, the country director for Oxfam in Peru. “For too long, powerful industry interests have trampled on community rights in the Amazon. This recent decision is a small but needed victory along a tedious and uphill journey for these federations, which Oxfam has proudly accompanied since 2012.”

Under the formal resolution with Prime Minister César Villanueva, the Ministry of Energy and Mining, and PetroPerú, the government will complete the community consultation for Block 192 between December 2018 and March 2019.

Extending across the Tigre, Corrientes, Pastaza and Marañón river basins in Peru’s remote Loreto province, Block 192 is the largest-yielding oil field in Peru, accounting for 17 percent of the country’s production. The government plans to continue production of oil at the block for another 30 years, adding to the almost 50 years of oil activity in the region. The oil field is currently operated by Canadian-based Frontera Energy, whose contract with PetroPerú is set to expire in September 2019.

American-based Occidental Petroleum discovered oil in the region in 1972 and a succession of companies, including the Dutch-Argentinian conglomerate Pluspetrol, left Block 192 (previously Block 1-AB) heavily polluted. While Peru’s Agency for Environmental Assessment and Enforcement fined Pluspetrol for violations, the Peruvian government remains in a protracted legal fight with the oil giant. A majority of the fines are outstanding and Pluspetrol denies any wrongdoing, despite settling with a local community in 2015.

For over 40 years, the indigenous Kichwa, Quechua, Achuar and Urarina peoples who live near the oil field have been exposed to salts, heavy metals and hydrocarbons. According to a 2018 toxicology study by Peru’s National Center for Occupational Health and Environmental Protection for Health, over half of the indigenous residents in the region’s four basins have blood lead levels that surpass international recommended limits. A third have levels of arsenic and mercury above the levels recommended by Peru’s Ministry of Health. Lead, arsenic and mercury overexposure are among the most common forms of industrial heavy metal poisoning and are linked to fatigue, depression, developmental delays and life-threatening complications. This fall, Oxfam and local organizations launched a “Heavy Metal not heavy metals” campaign, in partnership with national and international Heavy Metal bands, to highlight the health crisis.

In 2016, the United Nations called for “immediate remediation actions” to address oil spills and other pollution in the four basins. While the Peruvian government committed roughly $15 million to start the remediation process in 2015, non-governmental organizations estimate that the actual cost of cleaning up Block 192, along with neighboring Block 8, would approach $1 billion. To make matters more challenging, the $15 million fund is almost exhausted.

In addition to health and environmental threats, the region is poor and underdeveloped. Locals have limited access to education, employment and quality healthcare. Protests in response to the socio-environmental situation are common and delay oil production.

“A genuine commitment to the spirit of free, prior and informed consent—listening and responding to the needs of the community—will begin to address the tragic legacy of block 192,” Boeren said. A recent decision to fund regional health brigades, following the release of the latest toxicology study, will help compliment the government’s prior consultation decision.

Free, prior and informed consent is guaranteed in the United Nations Declaration on the Rights of Indigenous Peoples and, to a lesser extent, in Peru’s prior consultation law, passed in 2011. Under this law, the Peruvian government is required to seek input from indigenous peoples before proceeding with any development project that might impact them. Despite these guarantees, however, the national government and interested oil companies have only recently committed to negotiating with indigenous communities living adjacent to Block 192.

“The decision to implement prior consultation, with committed dates for specific steps, is a significant departure from oil business-as-usual in Peru,” said Emily Greenspan, Oxfam’s Associate Director for Extractive Industries. “Communities have the right to know about the environmental ramifications of new oil projects and the right to decide if these projects should advance at all.”

“We remain inspired by the determination and perseverance of indigenous leaders who have not buckled under government and industry pressure,” Boeren said. “Oxfam will continue to support them in their effort to right the many wrongs at this oil field.”

This post was co-written by Miguel Lévano, extractive industries and fiscal justice officer in Peru.

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