A Voice For the Voiceless

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The Advocacy Project seeks to help community-based advocates produce, disseminate and use information, and so become more effective advocates for human rights and social justice

Risky Business: The Oil Industry and Its Legacy of Pollution

Texaco – Pioneer in Pollution

Texaco Oil Company, which led oil exploration and development in Ecuador from the 1960s until 1990, has been a prolific polluter of the Amazon. The company’s Ecuadorian subsidiary began pumping oil in 1972, and continued for the next eighteen years, until Texaco’s drilling lease expired and it withdrew from the country. In those eighteen years Texaco extracted nearly 1.5 billion barrels of crude oil. From the time Texaco began pumping oil out of the jungle, it violated every principle of environmental safety.

Texaco drilled over 300 oil wells in the Oriente, and polluted the Amazon with a vengeance. For every barrel of refined oil there is another barrel of "production water," a combination of water and toxic wastes removed from the oil. In the United States, Texaco practices "reinsertion". This involves drilling a hole as deep as an oil well and pumping the production water back into a place where it will not harm the environment. But in Ecuador, Texaco dumped toxic wastes straight into the Amazon forests and rivers.

Over 18 years, Texaco dumped an estimated 20 billion gallons, or four million gallons of waste a day, into the environment. Much of this was deposited in hundreds of unlined "pools" dug into the countryside, where it would leach into the ground water and nearby rivers. When a pool would fill up, company employees would bale the wastes directly off into the rivers. Often they would pour it on the dirt roads, "to keep the dust down."

To make things worse, Texaco burned off billions of cubic feet of natural gas at refineries -- this in a gas-importing country -- further polluting the region and contributing to global warming. And recurrent pipeline breakdowns spilled another 17 million gallons of oil into the Oriente, far surpassing the Exxon Valdez accident. Pollution spread downstream all the way to Peru.

Arco’s Dubious Claim

By the 1990s, companies that came to communities to explore for oil found it necessary to introduce themselves by saying, "We are not like Texaco."

One of them was Arco Oil Company, which until recently held the oil prospecting rights for Block 10 in western Pastaza province. Arco enjoyed a reputation for using safer practices in oil extraction. But this is not necessarily deserved.

In 1988, the California-based Arco leased the right to prospect in Pastaza province. Together with Agip Petroleum Ltd, Arco built a pipeline from its installation at Villano in such a way as to minimize disturbance of the jungle’s tree canopy, an important travel route for animals. Equipment was transported into the forest by helicopter, and a temporary monorail system was then constructed to bring in the pipe material. After the pipeline was built, the trail was reforested. The well site was built as one compact, isolated installation.

It is indisputable that the technology of oil extraction is much safer than in the early days of Texaco’s rampage. However, the Arco-Agip project encountered environmental problems even before pumping began. Residents of the area around the town of Villano were complaining of damaging effects from the new project. Heavy equipment used to enlarge a road from Puyo towards the pipeline construction site was causing erosion and polluting streams.

Inhabitants of San Virgilio, a village near Villano, complained of illnesses that they said they had contracted from water polluted by the construction. And 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 San Virgilio. Simon Santi lived in the village and worked for Arco as an environmental monitor. As he told journalist Danielle Knight, he informed the company of four large leaks, but was told not to mention them in his report. Crude oil from one of these leaks was being washed by rain directly into the nearby Likino River, used by local people for fishing.

In spite of the soothing claims of 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 re-injection. Without stronger enforcement and monitoring, technology alone will not stop the destruction of the Amazon.

The Block Leasing System

The government of Ecuador rents oil exploration and drilling rights in territorial concessions known as "blocks" to foreign oil companies. At present there are 17 such concessions in the Oriente, and all but four of them are located in the northern half of the region. These 17 blocks have been leased by oil companies from the United States, Argentina, Spain, and other countries
Control of drilling rights shifts from one company to another periodically, but the drilling goes on. 

Auctions of oil blocks to the highest bidder are held periodically in Ecuador. In response to a severe economic crisis, the Ecuadorian government has taken measures to double oil exportation in the coming years. In tandem with construction of a new cross-country oil pipeline, the Ninth Round of oil block leasing will be held early in 2002. This comes after a long period of resistance against the new leasing, which threatens to open up vast new areas in the southern Oriente.

New oil blocks, on average, comprise approximately 200,000 hectares. The Ninth Round of leasing, as currently planned, will open at least four new blocks to prospecting deep in the heart of Pastaza province -- remote lands that are still pristine Amazon rain forests. The affected territories are home to many indigenous and colono (settler) communities. Some of the blocks being considered for leasing overlap protected natural reserves, including Yasuni National Park. There the living area of the Tagaere, the last uncontacted indigenous community, had been declared an "untouchable" zone. All this is threatened now.

Exploitation of the new oil concessions will bring considerable private investment to Ecuador. But at the same time, the expansion could have disastrous consequences for the people of the Oriente.