Dirty Plan for
Ecuador
Crude Oil Pipeline Looms on the
Horizon
Finally, after many years, the
government has acknowledged the damage
caused by the exploitation of heavy crude
oil in Ecuador. However, rather than
solving the problem, government officials
are just looking for another deal in the
proposed Heavy Crude Oil Pipeline.
Environmentalists have long decried the
serious adverse impacts of heavy crude
petroleum exploitation. In short, oil
exploitation often takes place in
environmentally protected areas and
indigenous territories. It often involves
corrupt contracts between the government
and oil companies. The type of oil being
extracted causes enormous damage during all
phases of production. During transport, the
heavy crude is mixed with the high quality
oil from Petroecuador, resulting in
millions of dollars of losses for the
country. Finally, the state refinery is not
adequately prepared to handle heavy crude
without risking damage to its
equipment.
These problems have been recognized at
least in part by the authorities, but
fundamental solutions are being avoided
with the proposal for a new oil pipeline.
The pipeline would eliminate the risks
caused by the mixing of oil, but will
present new problems.
The pipeline will require the continued
exploitation and destruction of
environmentally fragile and legally
protected areas. It will violate the
collective and environmental rights of
local populations, including the Haorani,
who do not want to see their lands
destroyed. The construction of the new oil
pipeline will cause severe damage in the
process of clearing the route.
Deforestation, interruption of water flows,
impacts on agriculture and conflicts in
urban areas will likely result.
A further complication is that Ecuador
is riddled with seismic faults, making it
impossible to find a safe route. Active
volcanoes also threaten any possible
route.
The pipeline is designed to transport
over 350,000 barrels of oil per day, even
though such quantities of heavy petroleum
reserves do not exist in the country. The
probable result will be that the new
pipeline will compete with the government’s
infrastructure for the transport of
lightweight oil.
Based on current reserves, oil
production will decline after the year 2004
to such an extent that the new pipeline
will no longer be necessary. Extracting
700,000 barrels per day implies not only
the super-exploitation of resources, but
also the consumption of oil reserves needed
for the future in a mere five-year
period.
Given these considerations, the pipeline
is completely irrational as it implies
building an enormous infrastructure that
will become redundant after only 20 years.
Construction would be financed through an
increased foreign debt or the mortgaging of
future resources.
The proposed route of the pipeline
parallels that of the government’s
trans-national pipeline, a path of
significant seismic risk with high
biodiversity and soft and fragile soil.
During the time that the existing pipeline
was operated by Texaco, more than 18
billion gallons of crude were spilled. The
government has admitted that in some cases
damage was caused by sabotage. Constructing
a pipeline in close proximity to the
Colombian border will expose the country to
great risk, given that Colombian guerrillas
have attacked the Colombian pipeline more
than 670 times over a 10-year period,
resulting in the spillage of over two
million barrels of oil.
Participating companies within the
pipeline consortium have committed
irregularities in past contracts, which are
currently being reviewed by the courts. The
government itself has not complied with
either Article 88 (prior consultation with
local populations in cases of environmental
impact) or Article 84 (collective rights)
of the Ecuadorian Constitution.
The driving force behind the crude oil
pipeline is not the legitimate needs of the
country, but rather an ongoing process of
corruption within the government of
President Mahuad. In March 1999, Minister
of Petroleum René Ortiz signed a Memorandum
of Understanding between five private oil
companies and the Ecuadorian government.
The awarding of the pipeline concession is
not intended to satisfy the real needs of
Ecuador, but rather to give absolute
authority to private companies so that they
can control all phases of production,
transport and commercialization.
Ultimately, they may succeed in creating
competition with the government pipeline,
which they may end up controlling as
well.
Ivonne Ramos,
Accíon
Ecológica/FoE Ecuador
