For Peru's Indians, Lawsuit Against Big Oil Reflects a New Era - Outsiders, NGOs and High-Tech Tools Help Document Firms' Impact

NUEVO JERUSALEM, Peru -- Tomás Maynas Carijano strolled through his tiny jungle farm, pinching leaves, shaking his head. The rain forest spread lushly in all directions -- covering what oil maps call Block 1AB.

"Like the trunk of that papaya, the cassava and bananas are also dying," said the spiritual leader of this remote Achuar Indian settlement in Peru's northern Amazon region. "Before Oxy came, the fruits and the plants grew well."

Oxy is Occidental Petroleum, the California-based company that pulled a fortune from this rain forest from 1972 to 2000. It is also the company that Maynas and other Achuar leaders now blame for wreaking environmental havoc -- and leaving many of the people here ill. Last spring, U.S. lawyers representing Maynas and 24 other indigenous Peruvians sued Occidental in a Los Angeles court, alleging that, among other offenses, the firm violated industry standards and Peruvian law by dumping toxic wastewater directly into rivers and streams.

The company denies liability in the case.

For indigenous groups, the Occidental lawsuit is emblematic of a new era. The Amazon region was once even more isolated than it is today, its people largely cut off from environmental defenders in Washington and other world capitals who might have protected their interests. Now, Indians have gained access to tools that level the playing field -- from multinational lawsuits to mapping technologies such as Google Earth.

Oil companies that once traded money and development for Indians' blessings are increasingly finding outsiders getting involved. "History has shown that oil companies will cut corners if someone isn't watching," said Gregor MacLennan of Shinai, an internationally funded civic group in Peru. "We try to get to local communities first to help them make informed decisions about oil companies and the changes they bring."

Lured by global energy prices, Peru is placing record bets on Amazon energy lodes: Last year the country's concessions agency, PeruPetro, signed a record 24 hydrocarbon contracts with international oil companies. EarthRights International, a nonprofit group that is helping represent the plaintiffs in the Achuar case, says half of Peru's biologically diverse Amazon region has been added to oil maps in the last three years.

Occidental pumped 26 percent of Peru's historic oil production from Block 1AB before selling the declining field to Argentina's Pluspetrol in 2000. "We are aware of no credible data of negative community health impacts resulting from Occidental's operations in Peru," Richard Kline, a company spokesman, said in an e-mail statement.

Kline said that Occidental has not had operations in Block 1AB in nearly a decade and that Pluspetrol has assumed responsibility for it. Occidental made "extensive efforts" to work with community groups and has a "long-standing commitment and policy to protect the environment and the health and safety of people," he said.

The California-based group Amazon Watch has joined the suit as a plaintiff, and the case is now inching through U.S. courts. In a federal hearing scheduled for Feb. 11, company lawyers will ask a judge to send the case to Peru, where Indians say corruption and a case backlog will hurt their chance of winning.

(A mining company just argued that it was not fair to be tried in a foreign court: Supreme Court Decision Rattles Canadian Mining Industry – Right to Pollute Under Threat – Teck Cominco Execs Vow Fight, say No to Cleaning Environment )
Learning Their Rights

The primitive trumpet -- a hollowed cow's horn -- brayed over this gritty river community at sundown. Residents of Nuevo Jerusalem, the Achuar settlement on the Macusari River, trudged up a path, toting shotguns and fishing nets. Some stepped down from palm huts, walking to the meeting in twos and threes. Soon, Lily La Torre was on stage.

"I've come to give you news of the Oxy suit," said La Torre, a Peruvian lawyer and activist working with Maynas's legal team. Barefoot women in dirty skirts circled the room, serving bowls of homemade cassava beer.

La Torre distilled legal strategies into simple terms. She told villagers that the case had been moved to the federal level in the United States. "Now they are trying to move the lawsuit to Peru," she said in Spanish, pausing for an Achuar interpreter. "But we must pray that the suit stays in the U.S. We know it cannot survive in Peru."

Later, as people approached her with questions, a man who was looking on said in broken Spanish: "When Oxy came, we did not know our rights. Now we do."

In addition to alleging that Occidental illegally dumped toxic wastewater, the Achuar suit accuses the company of generating acid rain with gas flares, failing to warn Indians of health dangers and improperly storing chemical wastes in unlined pits.
The "irresponsible, reckless, immoral and illegal practices" left Maynas and his people with poisoned blood, polluted streams and empty hunting grounds, the suit says. Plaintiffs want damages, declaratory and injunctive relief, restitution and disgorgement of profits. One woman is suing on behalf of her child, whose death she alleges is related to environmental contamination.

Last spring, before the Achuar case was filed, a team of health experts, lawyers and scientists funded by EarthRights International said in a report that the wells, pipelines and other infrastructure built here by Occidental had directly caused water and soil contamination, which in turn has caused health problems for many local people in Block 1AB.

Kline said the report contained "inflammatory misstatements, unfounded allegations and unsupported conclusions" and failed to provide basic information that would help determine whether oil operations contributed to the alleged environmental and health problems. "Nonetheless . . . we will evaluate the claims and the lawsuit and respond accordingly," he said.

A Technological Assist

Environmental groups are going beyond word of mouth and lawsuits to assist indigenous groups.

One day last fall, Guevara Sandi Chimboras was bouncing a pickup truck along a remote oil road near the Achuar community of Jose Olaya. Carrying a digital camera, notepad and a Global Positioning System transceiver donated by the civic group Shinai, Sandi walked through a grassy field to a pool of stagnant water. With a stick, he dug up a clump of glistening, pungent mud, and sniffed.

"The companies say these sites are clean," he said. "They won't believe us without documented photos. With words, they don't believe us."

There are no mass media in the rain forest. But Shinai has translated a U.S.-made documentary about the Achuar's problems into Machiguenga, the language spoken by Indians in southeastern Peru, where a U.S.-backed natural gas project is underway. The group uses DVD players powered by solar panels and generators to show the film to Indians considering agreements with oil companies.
Meanwhile, Google Earth is proving to be an omniscient eye. Peter Kostishack, a Colorado-based rights activist, uses the application to record coordinates and satellite images of rain forest erosion and post them on his blog. With help from the U.S.-based Amazon Conservation Team, Indians in Brazil's Amazon Basin have used Google Earth imagery to spot river discoloration caused by illegal mining operations.

"Many times a company claims natives don't have the technical knowledge to understand that it is doing the best it can, when in fact it may be doing as little as possible," said Bill Powers, chief engineer of E-Tech International, a nonprofit engineering firm based in California that provides Indians with technical expertise.

"We make it a battle of equals, at least in the knowledge area," he said.

Here is the full article.

Catholics Line up Against Mining Operations in Peru - Rio Blanco project proposed by Chinese owned Monterrico Metals

On a rainy morning in August, dozens of men and women crowded into the tiny church in the farming community of El Carmen de la Frontera, in the mountains of northern Peru. Foremost among their worries was a mining company prospecting for copper high in the cloud forest near the border with Ecuador.

The farmers feared that the mine would cut off water supplies to their crops, or affect the certification of the shade-grown organic coffee that they grow for export. A month later, they voted overwhelmingly against allowing mining in their district.

(Video about the referendum here: Barrick Gold Chairman, Peter Munk complains rogue Environmental NGOs are Destroying the Mining Industry )

As international metals prices rise, the Andes have become a prime target for investment by foreign companies. Communities often fight back, fearing that open-pit mines will pollute their water and land.

In many places, church workers are on the front line in efforts to stem environmental destruction. That makes them targets of both corporations and government officials eager to cash in on the bonanza.

In Chulucanas diocese in northern Peru, Bishop Daniel Turley, a Chicago-born Augustinian missionary, found himself on the firing line for defending the right of farmers to speak out about mining.

Protests over a planned open-pit mine in an area reputed to have a rich deposit of copper and molybdenum claimed two lives in 2004, and emotions were running high as three districts prepared for a non-binding referendum on mining that was held Sept. 16. Members of the diocesan Justice and Peace Commission visited villages, not telling people how to vote, but explaining how the referendum would work and encouraging residents to participate.

“As bishop, I stand for dialogue, not violence, but I am afraid there may be violence,” Turley told NCR a month before the vote.

Shortly before the referendum, Turley received threatening telephone calls that led the U.S. Conference of Catholic Bishops to send a letter to its Peruvian counterpart, expressing concern. The balloting was peaceful, however, as voters overwhelmingly opposed the proposed mining district, which community leaders are afraid would foul the headwaters of several rivers in a fragile cloud forest ecosystem.

Theirs will probably not be the last word, however. With copper prices so high that there is a brisk black market in the country for stolen telephone cables, García’s government will almost certainly continue to court the $1.44 billion Rio Blanco project proposed by Monterrico Metals, a London-based company that recently sold an 80-percent stake to the Chinese-owned Zijin consortium.

If built, the mine would be one of the world’s 20 largest copper mines. It would join other large-scale mining operations in Peru owned by companies such as Denver-based Newmont Mining Corp., Toronto-based Barrick Gold Corp. and Switzerland’s Xstrata.

Government officials say that mining, which has largely driven Peru’s economic growth in recent years, is crucial to the country’s development, and companies are often eligible for large tax breaks. Critics, meanwhile, point out that the remote Andean highlands where most mines are located continue to have the country’s highest poverty rates.

Peru’s bishops are not united on environmental issues, but Turley, Jesuit Archbishop Pedro Barreto of Huancayo in the central highlands, and Dominican Bishop Francisco González of Puerto Maldonado in the Amazon basin in southeastern Peru have taken an increasingly public stand on industries that they say have little regard for the health and welfare of surrounding communities.

In Barreto’s archdiocese, church workers have been threatened for their efforts to pressure Doe Run Peru, a subsidiary of the U.S.-based Renco Group, to clean up pollution from a smelter that has caused extensive lead poisoning among residents, especially children, in La Oroya, one of the 10 most polluted places on the planet, according to the Blacksmith Institute of New York.

In some cases, dialogue groups have been set up to help break impasses between mining companies and communities, but results have been mixed. Efforts at dialogue about the problem of the smelter in La Oroya have not brought the results that activists had hoped. But Barreto is hopeful that the broad-based coalition that has formed to clean up the Mantaro River valley will succeed because it is led by civic groups, rather than government agencies.

More recently, talks about the Majaz mine near Huancabamba broke down when the government refused the local mayor’s request that the Sept. 16 referendum be one of the points on the agenda.

Barreto arranged for a study by the St. Louis University School of Public Health, which found that most of the children in the neighborhood nearest the La Oroya smelter had high levels of lead, cadmium and other metals in their blood.

The archdiocese is spearheading a project to clean up the Mantaro River, which runs through Huancayo and La Oroya. The project involves community-based monitoring of air, water and soil samples.

On the eastern side of the Andes, in the southeastern Peruvian department of Madre de Dios, miners are blasting away huge swaths of jungle with high-pressure hoses and using backhoes and dump trucks to move thousands of tons of soil, destroying the fragile and biologically diverse ecosystem and silting up rivers in search of gold.

According to government statistics, Madre de Dios produces 15 tons of gold a year, but the real figure may be as much as twice that amount, because many of the mines are informal -- not subject to environmental, labor or safety regulations, and not paying taxes that could be used for environmental protection.

At a seminar sponsored in late September by the Peruvian Conference of Bishops’ Social Action Commission, Coadjutor Bishop Francisco González Hernández of Puerto Maldonado characterized the mining, which is also dumping tons of mercury into the rivers and atmosphere, as “savagery.”

While Barreto, Turley and González are speaking out on environmental issues, however, the Peruvian Conference of Bishops has been more reticent. Barreto said the issue is a challenge for the church hierarchy.

“The church in Peru must take significant steps to think about how to shed light on the problem of metals mining in the coming years,” he said. “Unfortunately, in Peru, there is not yet consensus among the bishops. There are some very timid signs, but we have a long way to go.”

Large-scale open-pit mines that process thousands of tons of ore, chewing away mountains and raising the specter of long-term acid drainage, have drawn fire from church workers and environmentalists from Guatemala and Costa Rica in Central America to the Andean countries and Chile in South.

In Oruro, Bolivia, on the high flat plain known as the Altiplano, Br. Gilberto Pauwels, a Belgian Oblate of Mary Immaculate, is monitoring two mines -- one in full production and one that is being closed down -- owned by Denver-based Newmont Mining Corp.

At the Center for Ecology and Andean Peoples (CEPA, for its Spanish initials), an environmental education and research organization in Oruro, Pauwels points to satellite photos that show a decrease in the flow of the Desaguadero River after the first mine opened. Researchers at the center, which Pauwels founded, say the mine has sucked water from the river, raising the salt content of the surrounding land.

“Because the land was already saline, [the mine] has accelerated the process,” said Jhonny Terrazas García of CEPA. “The agreement was to return the land to the community for production, but what are they going to produce in this soil?”

Even before the Spaniards arrived in South America, Oruro was a mining area. Claims have been staked around the town, even within the city limits.

“We know that all of these hills contain gold, but [mining] can’t be permitted within the city,” Pauwels said.

Nevertheless, Inti Raymi, a company in which Newmont is the majority stakeholder, has opened a $24 million mine within the city limits. The concession overlaps a wetland that has been designated a Ramsar site, a classification that gives it international recognition but no official protection.

CEPA has purchased land nearby, partly to monitor water quality and mainly to open an environmental, cultural and interreligious spirituality center where people can learn about organic farming and living in a way that will leave a smaller ecological footprint.

It seems a small line of defense against the nearby mine, where heavy machinery has already chewed away a mountain and giant dump trucks carry ore from a huge gash in the earth.

Nevertheless, Pauwels and his Bolivian colleagues at CEPA are steadfast in their defense of the environment, part of a church movement that is quietly growing throughout Latin America.

Brazil’s bishops and a handful of others raised the issue at the Fifth General Conference of Bishops of Latin America and the Caribbean in Aparecida, Brazil, in May, and the environment was included among the priorities outlined in the meeting’s final document.

Decrying the “irrational exploitation” of the region’s natural resources, the bishops blamed “the current economic model, which emphasizes the unbridled desire for wealth over human life and rational respect for nature.”

The bishops said the church must have a greater pastoral presence among “the populations that are most fragile and threatened by destructive development, and support them in their efforts to achieve equitable distribution of land, water and urban space.”

They also said the church must work for better environmental policies, monitoring of environmental standards and a model of alternative development that “includes responsibility for an authentic natural and human ecology, that is based on the gospel of justice, solidarity and the universal destination of goods.”

“The times that are coming will be difficult,” said Barreto, “but they will bring us to greater communion and a more radical way of following Jesus.”

Barbara Fraser is a freelance writer living in Peru.

Here is the full article.

Peru, China Agree to Boost Investment at Business Forum

LIMA, Dec. 4 (Xinhua) - Peru and China held an investment forum here Tuesday to shore up bilateral trade and investment.

Around 200 entrepreneurs and business people from both countries took part in the gathering to discuss more opportunities in two-way trade and investment.

Peru's Cabinet Chief Jorge del Castillo said in the opening speech that Peru welcomes Chinese investments in such sectors as mining and setting up new factories.

Chinese Ambassador to Peru Gao Zhengyue said bilateral trade and investment developed at a fast pace and China has become Peru's second largest trading partner and exporting market.

The two countries's trade has reached 4.4 billion US dollars so far this year, up 800million dollars from the total of 2006, according to the ambassador.

Here is the full article.

Barrick Gold Chairman, Peter Munk complains rogue Environmental NGOs are Destroying the Mining Industry

In the communities of Peru, where new copper mines are planned a referendum on mining was held.

Votes cast: 8,873 (48.17 percent of the total electorate)
Votes in favor of mining in the district: 176
Votes against mining in the district: 8,294



It would appear the people of Peru disagree with Peter Munk and the Barrick Gold Corporation.

Want to see more outrageous assertions from the Barrick Gold Corporation? Watch this next video: Barrick Gold Corporation Chairman asserts that gold mines create jobs and feed people. (so would dismantling the Pyramids of Egypt)

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It is not the Environmental NGO's that are out of control, but the rogue Canadian Mining Industry:

Mining Misery: Guatemala is one of many countries that has attracted the investment of Canadian Mining Companies – but at what cost to its people?

Canadian Government Urged to Rein in Mining Sector

10 Things Canada Does Best - What Canada doesn't do best is hold domestic mining companies accountable for the damage they do abroad.

In Chile, Precious Lands Often Go for a Pittance - Barrick Gold Corporation Pays $19 Dollars for 20,000 Acres

Canadian, Goldcorp's open pit, cyanide-leeching mine runs up against local opposition in Guatemala

Canadian Barrick Gold Corporation Pascua Lama Project Protested - Al Gore insisted upon removing Barrick Gold as a sponsor of his May visit to Chile.

Corporate rights trump human rights - alleged that Canadian Barrick Gold security forces intentionally buried alive 52 artisanal miners in Tanzania.

PSEG Global sells plants in Peru to SN Power Norway & plans sale in Chile

PSEG Global yesterday said it has entered into an agreement to sell its ownership of four hydroelectric plants in Peru to a wholly owned subsidiary of Statkraft Norfund Power Invest of Norway for $284 million.

The sale of its Electroandes unit, which includes the power plants and 437 miles of electric transmission lines, is in keeping with the strategy of PSEG Global's parent, Newark-based Public Service Enterprise Group, to divest its international assets in an effort to reduce risk and raise capital for growth opportunities in its core U.S. markets.

PSEG Global bought Electroandes in December 2001 for $221 million.

Under the terms of the deal, SN Power also will assume $106 million in debt. After taxes and dividends paid prior to closing, PSEG Global expects to net cash proceeds totaling from $215 million to $225 million.

Electroandes includes four hydropower plants with a total capacity of 180 megawatts. It is located in the central Andean region of Peru.

Last week, PSEG Global said it is also exploring the sale of its 50 percent stake in Chilquinta Energia, an electric-distribution company in Chile, and its 38 percent ownership of Luz del Sur, a distribution company also in Peru.

"We are selling Electroandes as part of PSEG's announced strategy of opportunistically monetizing its international assets at attractive prices," said Matthew McGrath, president of PSEG Global. "We are pleased that we were able to make the sale to a company with an excellent reputation, significant experience in hydroelectric power operations and a strong environmental focus."

SN Power is a growing international renewable energy company that develops, owns and operates hydropower projects and plants in emerging markets. The company is jointly owned by Statkraft and Norfund. Statkraft is a state-owned Norwegian company and northern Europe's largest generator of hydroelectric power, operating 91 hydro plants.

Here is the full article.

When Ice Turns to Water

Glacial melting poses potentially costly problems for Peru and Bolivia

FOR centuries, the run-off from the glaciers atop the spectacular snow-capped mountains of the Carabaya range has watered the pastures where alpacas graze around the small town of Macusani. More recently, the mountains have provided the town with drinking water and hydroelectricity, as well as hopes of attracting tourists to one of Peru's poorest areas. But in Carabaya, as across the Andes, the glaciers are melting fast. Their impending disappearance has large, and possibly catastrophic, implications for the country's economy and for human life.

Peru is home to the world's biggest expanse of tropical glaciers. Of the 2,500 square kilometres (965 square miles) of glaciers in the four countries of the tropical Andes—Bolivia, Colombia, Ecuador and Peru—70% are in Peru and 20% in Bolivia. The last comprehensive satellite survey by Peru's National Environmental Council, carried out in 1997, found that the area covered by glaciers had shrunk by 22% since the early 1960s. In the Carabaya range, they had receded by 32%.

Partial surveys by geologists suggest that the rate at which the glaciers are melting has speeded up over the past decade. The glacier at Pastoruri, in the Cordillera Blanca range north of Lima, shrank by more than 40% between 1995 and 2006, with the loss of ice caves popular with tourists, according to Marco Zapata, a glaciologist at the government's Natural Resources Institute. He reckons it will be gone by 2015. That is the fate that has already overtaken many smaller glaciers in Bolivia, and that of Cotacachi in Ecuador. Chacaltaya, above Bolivia's capital, La Paz, has almost disappeared; it is the site of the country's only ski resort, whose future is now uncertain.

“We are already experiencing the effects of global warming,” says Nancy Rossel, the mayor of Macusani. To those who doubt its existence, she offers to show them pictures taken ten years ago of Allinccapac, the mountain above the town, and “they can see how far the glaciers have receded.” A report by a team from the World Bank published last month in the bulletin of the American Geophysical Union (AGU), a scientific association based in Washington, DC, confirms most of the mayor's fears. It predicts that many of the lower glaciers in the Andes will be gone in the next decade or so, and that glacial runoff may dry up altogether within 20 years. It also paints a troubling picture of the future impact on water and power supplies.

One danger is that as the ice melts, newly formed lakes may send water cascading down mountainsides, triggering mudslides that are potentially lethal for the villages below. Another is that if there are no glaciers to regulate water flow, flood will alternate with drought.

That is a particular worry for Peru. After decades of migration from the Andes, two out of three Peruvians now live on its desert coast. Lima, with 8m people, is the world's second largest city located in a desert, after Cairo. Big irrigation projects have made the desert bloom and enabled an agro-export boom. Yet most of Peru's fresh water lies east of the Andes. Water for both irrigation and human consumption from the short, coastal rivers will become more irregular.

The government says it needs to spend about $4.5 billion to bring domestic potable-water coverage up from its current level of 78% to the regional norm of over 90%. Billions more will be needed to divert water along tunnels beneath the Andes if glacial melting accelerates.

Another problem is that more than 70% of Peru's electricity comes from hydroelectric dams sited on the glacier-fed rivers. If their flow becomes more irregular, so will power supply. Once the glaciers disappear, Peru will have to invest $1.5 billion a year in thermal generation, according to the AGU article.

Here is the full article.