The Misleading Art of Commercial Deception; or how to Transform a Major Polluter into an Environmentally Sustainable and Socially Responsible Company

“Working in harmony with nature and the community” reads propaganda distributed by Pluspetrol Norte, but Alianza Arkana knows that the realiy is much different, as detailed by our project coordinator, Stefan Kistler below.

“Working in harmony with nature and the community” reads the front page of a pamphlet that I picked up at this year’s Expo Amazonica in Iquitos. The cover photo shows a scene of indigenous women in their native community, with the backdrop of the ever green Amazon Rainforest. On the top left the logo of Pluspetrol Norte. Judging by the illustration, and not knowing who or what Pluspetrol Norte is – although the name reveals its intentions – you might first think of an environmental NGO, an eco-tourism venture or a conservation organization.

I rubbed my eyes… In this brochure, Pluspetrol Norte S.A., an Argentinian based Petroleum company, advertises itself as a pioneer of environmentally sustainable oil exploitation in the Peruvian rainforest (not an oxymoron in itself?), a socially responsible enterprise supporting community projects, creating employment locally, providing health care, and as such a “neighbor” loved and welcomed by the local indigenous communities. However, the reality is much different.

On November 25th 2013, Argentinian oil company Pluspetrol Norte was fined by Peru’s Agency for Environmental Evaluation and Control (OEFA) with over 7 million USD for irreparable environmental damage and “disappearing” lake Shanshococha in Pluspetrol’s oil concession 1AB (soon to-be renamed 192) in the Pastaza river basin in Northern Peru. A few days later, on November 29th, the third in a series of environmental emergencies in the river basins affected by Pluspetrol Norte’s operations was declared for the Upper Tigres River. [1]

Pluspetrol has been increasingly under fire as the indigenous population of four affected river basins have organized and mobilized themselves over the last years, outraged by 40 years of oil contamination and exploitation. Spearheaded by the indigenous federations, supported by a handful of NGOs, and recently even parts of the Peruvian Government; closer monitoring of Pluspetrol’s activities has brought more disturbing details to light. These details tend to be in disharmony with Pluspetrol’s own discourse.

As this year comes to a close, it is time to have a closer scrutiny at this company and depict some of the recent events and facts revolving around Pluspetrol’s activity in this remote part of Northern Peruvian Amazonia.

ShanshocochaShanshococha lake in Lot 1AB, in may 2012: A Quechua Indigenous Environmental Monitor in the Pastaza shows what once was a lake, used on a daily basis by local communities, here entirely filled with crude oil. Photo credits: Alianza Arkana/FEDIQUEP.

Environmental emergencies

Pluspetrol has been operating the oil concession 1 AB (to be re-auctioned as 192 shortly), in the northern region of Loreto in the Peruvian Amazon, since the year 2000, when they took it over from Occidental Petroleum which arrived in the region as early as 1971. Similarly, Pluspetrol acquired operation rights over the neighboring oil block 8 from Petroperu in 1996. [2]

In 2012, after more than forty years of oil activity and many years of unanswered pleas and protest by the local indigenous population, the Peruvian government launched a multi-sectoral commission to investigate the state of the environment in the different river basins where Pluspetrol operates.

The first results, from the Pastaza River, came in March. They were devastating. Life threatening levels of heavy metals and hydrocarbons were found in soil and water sources, from which the local Quechua people harvest their food, fish and fetch their drinking water every day. The Pastaza had to be declared an environmental emergency. [3]

The results of a second river basin, the Corrientes, were published in August 2013. They were dismayingly similar to the ones in the Pastaza. As expected, a few weeks later, the government then equally declared an environmental emergency for the Corrientes River. [4]

More recently, on October 10th, the findings of the Tigre river basin were released. By now, the story has become too familiar. Water bodies and soils are heavily polluted. 39 out of the 45 superficial water samples that were taken proved to be contaminated with lead. Of the 59 soil samples taken, 56 exceeded Peruvian Environmental Quality Standards for soils for at least one parameter, many of them exceed several parameters. Particularly grave in this case was that, out of the 59 points where soil samples were taken, 57 had never previously been declared by Pluspetrol. On November 29th, the upper Tigre river basin was declared an environmental emergency . [5]

Currently, investigations are underway in the remaining basin affected by the oil activity of Pluspetrol, the Marañon River, which, just a bit further downriver from Pluspetrol’s installations, becomes the great Amazon. No one expects the results of these tests to be any less serious.

Pluspetrol in general denies any responsibility for the environmental damages in Lot 1AB, but blames its predecessor Occidental Petroleum. There is no doubt that “Oxy” – as they are commonly called in the communities – left an incredible mess. What Pluspetrol usually omits, however, is that they haven’t complied with legal environmental management instruments, created exactly with the objective to adequately guide hydrocarbon installations and activities. As such, these instruments demand measures to remediate affected areas in order to comply with maximum acceptable emissions and discharges, as well as the management and disposal of waste. [6]

At best, Pluspetrol hasn’t complied with these legal instruments. But local communities, indigenous environmental monitors, and crude (oil-) facts indicate a more disturbing truth.

Oil Spill A recent crude oil spill in Lot 8X. This Lot is located within Peru’s largest National Reserve Pacaya Samiria, famous for its sensitive wetlands. For decades irresponsible oil activity has heavily affected local communities and life in general in the Reserve. The Kukama people have long been denouncing these facts but, until recently, have largely been ignored. Photo credits: Stefan Kistler / Alianza Arkana.

Over 100 oil spills over the last 5 years

The indigenous peoples of the four affected river basins have trained environmental monitors over the last years to monitor oil activity in their territories. PUINAMUDT (Pueblos Indigenas Amazonicos Unidos en Defensa de sus Teritorios), the united platform in which the affected peoples have organized themselves, reports that these monitors in Lot 1AB alone have identified over 100 crude oil spills over the last 5 years. FECONACO, the federation of indigenous people on the Corrientes river, reported 3 crude oil spills in 2013, from January to April alone. In August, a member of the Urarinas people, whose lands are being crossed by the pipelines that connect Lot 8, approached environmental and human rights organizations in Iquitos to report two major oil spills, one in May and one in July. In September, ACODECOSPAT, the federation representing 57 indigenous Kukama communities on the Marañon, held a press conference and presented visual evidence of a recent large crude oil spill from Lot 8X, located within the Pacaya Samiria National Reserve. More recently, another large oil spill has been reported from the pipeline in Lot 8X, to which photographic evidence is being collected as we speak.

But even if one doesn’t believe the reports from indigenous groups, as many in Peruvian politics and business still don’t, the national body responsible for monitoring oil installations – OSINERGMIN [7]– reported that 25 oil spills occurred in Lot 1AB between 2010 and 2011. The renowned online portal for indigenous affairs, SERVINDI, cites a report that states that Pluspetrol has registered 78 oil spills between 2006 and 2010 in Lot 1AB and 8. To be clear, the numbers indicated above only include the registered spills – testimony from the indigenous populations indicates a much higher amount of spills.

Rusty pipelinesState of oil pipelines which move thousands of barrels of hot crude oil around every day: This particular picture is from the pipeline that connects Lot 8X with the oil installations in Saramuro on the Marañon River. 16 kilometers of tubes in miserable conditions cross through the Pacaya Samiria National Reserve. Photo credits: Stefan Kistler / Alianza Arkana.

Attacking rusty old pipelines

How does Pluspetrol explain these oil spills? Vandalism! Pluspetrol persistently blames local and indigenous people for vandalizing pipelines and creating oil spills in their own forests, lakes and rivers. Without denying categorically that vandalism doesn’t exist, this explanation omits large portions of reality.

If one makes the effort to journey to these remote areas and look at these pipelines that move thousands of barrels of crude oil every day, one quickly notices the poor state they are in. They literally look like they came from another century. The vast majority of them have never been changed since operations began over 40 years ago; they are rusty and full of corrosion. In some parts, leaks have simply been patched over. Moreover, tubes can be found lying directly on the ground, without adequate support to keep them above ground, lacking simple access paths. Finally, in some instances, large parts are submerged in water in sensitive wetlands. [8] As such, these pipelines are violating several established national laws and guidelines. [9]

Furthermore, the crude oil that is transported through these pipelines is under high pressure, and very hot. Independent experts agree that one would put his own life at risk if one was to try and sabotage a pipeline by making a hole in it. Photographs of oil stains three to four meters up on surrounding trees illustrate this risk very well. This aspect is almost never mentioned in defense of indigenous communities. On the contrary, the company continuously misleads the public opinion by categorically placing the role of “villain” on local communities.

By now, the picture Pluspetrol paints of harmonious relations with the communities and environmental stewardship has started to fade.

Polluted production waste water straight into the rivers

In concessions 1AB and 8, it took until the year 2009 — after several years of prolonged and firm protests by the local population — that Plusperol finally re-injected all of its production water back into the ground. [10] Pluspetrol boasts of the half billion US dollars they have invested in the construction of this re-injection system. [11] What they don’t mention, however, is that until 2009 their practice was to dump this production water – with temperatures ranging up to 90° C (194° F), highly salty, and with a high barium content – directly into the rivers and creeks.

For each barrel of crude oil produced, one hundred barrels of water are used. Thus, every day Pluspetrol dumped approximately 1,100,000 barrels of production water directly into the Pastaza, Corrientes, Tigre and Marañon. [12]

Although the construction of the re-injection system is of course one of the more positive developments during the recent years, it is worth adding that having stopped releasing production waters into the surrounding water bodies, doesn’t mean that the damage of all the previous years’ contamination has been reversed.

Health care and employment

Flipping over the page of Pluspetrol Norte’s brochure, I stare at the picture of children in a modern school building, and read about the health care Pluspetrol’s own medical station is providing. According to the company, their medical center in Andoas (on the Pastaza River) – the main industrial camp and airport are based around this village – provided 24,000 medical consultations in 2010. They also, in emergencies, provide free transport on their flights for patients from the communities to Iquitos, the regional capital.

Locals confirm much of the above and express appreciation. However, it is necessary to look at this issue from another angle. The prolonged exposure to hydrocarbons and heavy metals, such as Mercury, Barium, Aluminum, Cadmium, Arsenic, and Iron—all of which have been found in soils and water sources in the Pastaza basin around Andoas, as well as in the Corrientes and the Tigre basins – have been scientifically proven to lead to such diverse and serious illnesses as cancer, increased blood pressure, muscle debilitation, nervous system damage, chronic headaches, kidney failure, to mention but a few. [13] People in the affected villages complain about the increase of “unknown” diseases they have never seen before, as well as chronic headaches and stomachaches, among others.

Seen from this perspective, much of the health service provided by Pluspetrol merely helps to alleviate some of the serious health damage they themselves have caused in the first place. It is a bit like cutting off someone’s leg and then congratulating yourself for donating an artificial limb.

Pluspetrol further proudly informs us of employment and communal enterprises being created. The workers from these communal enterprises are easily spotted in Andoas: they are cutting the grass around the main plaza and next to the roads. In other words, very few, if any, locals make it into a more qualified position for Pluspetrol. The qualified labor comes from different parts of the country, and abroad. What is more, locals tell us that they are often hired to do clean-up when oil spills occur, without being provided adequate protection gear.

ShanshocochaShanshococha lake in October 2012: Indigenous Quechua leader Aurelio Chino sits on what is now a huge constructions site. On November 25th, Peru’s Agency for Environmental Evaluation and Control (OEFA), fined Pluspetrol with over 7 million dollars for irreparable environmental damage and disappearing lake Shanshococha. Photo credit: Stefan Kistler / Alianza Arkana.

The PR machinery of Pluspetrol

The list of social conflicts and environmental problems which Pluspetrol has created in Peru extends much further than the scope of this short article. [14] But all of the above make it clear that the harmonious picture they try to convey to the public doesn’t withstand a minute of more careful investigation. Simply speaking to local communities, who have experienced 13 years of living with Pluspetrol, and over 40 years with oil companies on their territories, paints a shockingly different portrait.

This example of Pluspetrol exposes a perversity of our time, in which the most professional public relations department can sell you a donkey for a horse, make a fake pass for an original, or transform a recklessly polluting and human rights violating oil company into an environmentally sustainable and socially responsible company.

Some might call this professional PR management. The Quechua indigenous leader from the Pastaza, Aurelio Chino Dahua, who has seen his forest lands turned into an environmental emergency also due to Pluspetrol, is more direct in his message: “they are trying to cheat us.” He is much closer to the truth.

Alianza Arkana, Monday, 09 December 2013
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