Tag Archives: oil spills Ecuador

The New Lepers: Oil in Ecuador and Arctic Drilling

Some of Europe’s largest banks are phasing out trading services for the export of oil from the Ecuadorean Amazon, a move that reflects the growing focus of global banks on climate change and their shift away from increasingly risky fossil fuels.

On January 25, 2021, Switzerland’s Credit Suisse Group AG and Holland’s ING said that they were excluding new transactions related to exports of Ecuador’s Amazonian oil from their trading activities, citing climate change and concerns for the Amazon rainforest and its Indigenous people. France’s BNP Paribas SA, the largest bank in the eurozone and one of the region’s trading powerhouses, said in December 2020 that it would immediately exclude from its trading activities the seaborne exports of oil from the Esmeraldas region in Ecuador under its latest environmental finance policies.

Ecuador isn’t one of the world’s top oil producers, but petroleum exports are a key contributor to the country’s economy. Petroecuador, the nation’s state-owned oil company, didn’t respond to requests for comment.  The banks’ flight from Amazonian crude follows last year’s crash in oil prices and growing fears of so-called stranded assets, which are fossil fuels that lose value due to the world’s transition to cleaner forms of energy…

Banks are also facing calls from environmentalists and Indigenous peoples to limit their involvement in fossil fuels. In Ecuador, a campaign by activists and Indigenous people spurred ING and Credit Suisse to reduce their exposure to the Amazonian oil trade. The nonprofits Stand.earth and Amazon Watch published a report in 2020 that called out banks—including ING, Credit Suisse and BNP Paribas—for their financing of Amazonian crude…

Banks and insurers are also cutting ties with Arctic oil drilling. This month, Axis Capital Holdings joined fellow insurers AXA and Swiss Re in pledging not to underwrite any new oil-and-gas drilling in the Arctic Wildlife Refuge in Alaska.  The six biggest U.S. banks— Citigroup Inc., Bank of America Corp. , Goldman Sachs Group Inc., JPMorgan Chase & Co., Morgan Stanley and Wells Fargo & Co.—have also said they would end funding for new drilling and exploration projects in the Arctic.

Excerpts from Dieter Holger & Pietro Lombardi, European Banks Quit Ecuador’s Amazonian Oil Trade, WSJ, Jan. 25, 2021

Oil Barrels Spilled in Amazon: Peru

It’s been a bad year for Peru’s Amazon – 2016 has seen seven oil spills there so far. And it’s only September. Most of these occurred across the Northern Peruvian Pipeline, in operation since 1977, which transports crude from the Peruvian Amazon to the Pacific Coast along 854 kilometers (530 miles) and is under the control of state-owned Petroperu. After the first two spills leaked around 3,000 barrels, in January and February 2016, the pipeline was shuttered for repairs. However, five additional oil spills have happened since then.According to Peru’s environment regulator OEFA, at least five oil spills were due to poor pipeline conditions, and illegal use of it after the closure. However, the oil company is blaming the latest two spills on vandalism by locals.,,

[M]ore than 190 oil spills have been recorded in Peru since 1997, according to Peru’s energy and mining agency. But the situation appears to have worsened since the beginning of 2016. After the two oil spills leaked 3,000 barrels – polluting nearby rivers and destroying the livelihood of locals – protests against pipeline’s poor conditions in February 2016 forced its shutdown.

When a third oil spill occurred in June 2016 – of 600 barrels – then-Minister of Environment, Manuel Pulgar Vidal, accused Petroperu of pumping crude illegally through the pipeline. The president of Petroperu was ousted, and a $3.5-million (around 3-million-euro) fine was levied.

But the disaster continued: During August and September 2016, four additional oil spills were recorded in the area. The last two occurred while thousands of indigenous people were demonstrating for withdrawal of the oil companies. According to the Peruvian government, Petroperu is responsible for at least five of the seven oil spills – the company has already been penalized more than $7 million. Petroperu continues to insist, however, that the oil spills were a result of extreme weather or vandalism by the locals.

The amount of oil spilled 2016 in the Peruvian Amazon – less than 10,000 barrels in seven spills – is a relatively small amount, compared for instance to the 650,000 barrels of oil that have fouls parts of the Amazon of Ecuador since the 1960s.

Repeated oil spills threaten Peru’s Amazon, DW.com, Oct. 2, 2016