Celulosa Arauco y Constitución (CELCO) of the Angelini Consortium to be protested at Ibo American Summit

Paper Pulp Manufacturers Creating Environmental Problems Throughout Southern Cone

(Nov. 6, 2007) Environmental activists from the Argentine city of Gualeguaychú disclosed their intention this week to protest at the upcoming Ibo American Summit. Their protests will focus on the cellulose industry’s detrimental environmental effects in their country.

The issue is of growing importance Chile, where environmentalists and politicians are increasingly outspoken against the long and troubled environmental history of cellulose manufacturer CELCO – Latin America’s second largest paper pulp manufacturer.

(The Angelini Consortium which owns CELCO is also a minority owner of Colbun SA which is partnered with Endesa in the HydroAysen project to dam the Rio Baker and Rio Pascua. The environmental group, Forest Ethics withdraws support: ForestEthics Challenges Chile's Matte and Angelini Economic Groups )

The Ibo American Summit, to be held November 8-10 in Santiago, brings together the heads of state Latin American countries and their EU counterparts from Spain, Portugal and Andorra. This year’s event will focus on social cohesion and greater equality through increased cooperation between Latin America and the Iberian nations.

Still, Argentine environmentalists want to ensure that environmental concerns, especially relating to cellulose production, receive ample attention.

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The Argentine protests coincide with growing concern in Chile about the environmental record of Celulosa Arauco (CELCO). CELCO, which runs five pulp mills around Chile and is owned by the politically well-connected Angellini group. The Angellini group has donated generously to the Concertacion political coalition that has dominated Chilean politics since the country’s transition to democracy in 1990.

The Region VII Environmental Commission (COREMA) ordered CELCO’s Licancel plant shut down in June after the plant’s waste materials contaminated the nearby Mataquito River, killing thousands of fish. A second, smaller waste spill occurred one week later, also contaminating the same river (ST, June 20). In the five months since the complex has been closed, it would have produced more than 53,000 tons of cellulose.

Region VII Sen. Jaime Gazmuri (PS) recently told the Santiago Times that he is convinced that CELCO must do more in order to show that the company has cleaned up its act.

“There is plenty of technology available in order to prevent these occurrences from happening again. Still, the plant has yet to guarantee that it is using the right type of technology. They need to show proof that they have cleaned up their act because, until this point, the plant has had detrimental environmental effects,” Gazmuri said.

CELCO officials disclosed two weeks ago that the plant’s closure has thus far cost the company US$35 million. But Gazmuri says they have no one else to blame but themselves.

“Those losses fall completely on CELCO’s shoulders. There was an environmental catastrophe which caused terrible damage to the (Mataquito) River. The pollution levels did not come anywhere close to meeting the company’s own standards. This was no accident. This was a bad decision made by the company management (…) their responsibility is absolute” (ST, Oct. 25).

Still, CELCO showed an overall profit of US$534 million through the third quarter of this year, a 25 percent increase compared to the same period last year (ST, Nov. 2). The positive numbers are attributed mostly to record prices for cellulose and a sharp increase in production capacity.

Huge profits notwithstanding, the company has a long history of environmental abuse and degradation.

Prior to the Mataquito River fish kill, CELCO received tremendous national and international publicity for its 2004 poisoning of the Cruces River with poorly treated waste from its Valdivia cellulose plant. The poisoning resulted in the death and migration of Valdivia’s emblematic black swan population and numerous lawsuits. (ST, June 6, 2005, Apr. 2, 2004) Still, the company initially refused to acknowledge its responsibility for the Cruces River spill and submitted false information to local courts in an effort to exculpate itself. (ST, Oct. 25)

More recently, CELCO is seeking to pump its Valdivia plant contamination to the Pacific Ocean and has offered large sums of money to buy-off opposition to its waste duct project (ST, Aug. 27). The opposition is coming primarily from artisan fishermen (fearing their livelihoods will be jeopardized by the duct) and from Chilean and international NGOs.

The Angelini group used its influence in 2004 with then-president Ricardo Lagos to keep the Valdivia plant from shutting down when the black necked swan kills became international news.

Here is the full article.