A Seat at the Table

...It would take more than technical training to overcome the vast economic, social and cultural factors working against these marginalized communities threatened-and tempted-by oil...

...The government followed with new environmental regulations and regular meetings with indigenous groups and NGOs...

...With the assistance of CDES, the Quito-offshoot of CESR (with the same name in Spanish), the Secoyas negotiated a code that provides an array of rights, including information, consultation, collective negotiations, advisors, arbitration and resources to prepare the community for dialogue...

...Good faith on the part of companies will never be enough...

...Socioeconomic been described by with poverty rates c infrastructure-"oads...

...However, the lack of effectiv trol has allowed a tiny group of elite...

...little match for the real material promises of this wealthy industry...

...Today, after 30 government encouraged colonization of the Amazon imated half of the to relieve internal land pressures, offering legal title ,r per capita is the to any person who cleared and planted crops in the atin America...

...The Ecuadoran govs and foreign com- ernment had neither the resources nor experience to e leaving the most develop oil and instead allowed Texaco to exploit the he burden...

...In 1993, U.S...

...Two important issues are often lost in the singleminded focus on dialogue and conflict resolution...

...The sta Before oil development, the countr foreign debt of $200 million, a p 50%, unemployment and under-em meanwhile, the poorest 20% of th trolled 6.7% of the country's resourc years of oil production, with an est country's reserves depleted, Ecuado most highly indebted country in L poverty rate is over 67%, under-em lessness runs at 65%, and the poore ulation controls only about 2% of tht The precise role of oil in these grim sible to measure, but its influenc whelming in skewing resources, c and creating enormous dependen industry...

...These steps had little practical impact, but they were evidence of the growing influence of civil society protests...

...Fair negotiations and real guarantees relating to environmen- dynamtal, social and cultural impacts are next to impossible without the more active and progressive intervention of A fisherman cleaning his canoe after an oil spill in the Peruvian Amazon caused by the Pluspetrol company...

...The pressure drove Conoco (and NRDC) out of the country, and provided one of the first concrete (though short-lived) victories for activists...

...panies to capture the benefits, while vulnerable populations to shoulder t boom has tended to exacerbate econ structural inequities and political ins the country's colonial past...

...Occidental officials justified the agreements and process by noting that the community drew up the list of benefits, the company had provided general information about their plans, and the community had no need for outside advisors...

...The code is notable for having included a statement from the oil company promising to respect international human rights treaties and the constitutional rights of the community, and for its focus on the process and conditions of dialogue--including resources, mediators and transparency...

...These young "leaders" were more likely to be swayed by the promise of Western-style development and goods than were community elders and women...

...An independent consultant hired by Occidental to measure potential impacts on the Secoyas warned that development would be culturally and socially devastating, and recomVol XXXIV, No 4 JANUARY/FEBRUARY 2001 45 0 0 0 Vol XXXIV, No 4 JANUARY/FEBRUARY 2001 45REPORT ON OIL mended that it not be undertaken in their traditional lands...

...causing widespread deforestation, loss of land and statistics is impos- wildlife, cultural disintegration, disease and a host of e has been over- new social problems, including alcoholism and prosticorrupting politics tution...

...Local communities have played an increasingly important role in these protests and have forced significant changes on the industry...

...Early last year, indigenous groups and sympathetic members of the military overthrew the governmentushering in Ecuador's sixth president in the last five Vol XXXIV, No 4 JANUARY/FEBRUARY 2001 41REPORT ON OIL tumultuous years...

...of State...

...The lawsuit, scientific data and human rights report attracted national and international media coverage and sparked a wave of organizing in the Amazon, particularly among nonindigenous communities who had come to represent a majority of the Amazon population...

...First, attenhurdles to "fair" negotiations are almost insurmountable, given the vast power and resource imbalances between the Goliath multinational corporations and the marginal- withized and impoverished Amazon communities...

...Countries like Ecuador are ill-suited to take advantage of the short-term wealth generated by oil...

...In 1999, the Shuar Federation (FIPSE) brought an unprecedented injunction against Arco, challenging the oil industry's traditional divideand-rule tactics...

...As a ompany ethic emerged that replaced t with an equally questionable paternal44REPORT ON OIL ism...

...On this day, concerns about oil development, so evident in the mock negotations, were Chris Jochnick is Legal Director, Centro de Derechos Econ6micos y Sociales (Quito), co-founder of the Center for Economic and Social Rights, and former editor in chief of the Harvard Human Rights Journal...

...At the first site, a clearly surprised minister waded into the oil wastes and publicly lambasted the Texaco representaVol XXXIV, No 4 JANUARY/FEBRUARY 2001 43REPORT ON OIL tive...

...As Koffi Annan builds a "global compact" trainbetween the United Nations and corporations, environ- direcmental and human rights groups are lining up to work with yesterday's corporate villians, and the Clinton Administration has specifically targeted the oil industry as warranting "creative American diplomacy...

...By channeling concerns into a narrow set of issues, dialogue risks obscuring the costs of oil developindigenous ment at the national level, and-as in the case of global warming--at the international level as well...

...95, No...

...agreement, the community had no information about the company's plans or likely impacts, no outside advisors, no time to consider the issue and were threatened with expropriation of their lands by the military official accompanying the oil representatives...

...The Achuar have drawn up one such proposal, which would include carbon trading rights to offset lost oil earnings...

...industry...

...An expanding narcomilitary conflict along the Colombia-Ecuador border, fueled by the U.S...

...One of the more successful efforts involves the Achuar, who have established a thriving eco-tourism business and are pursuing different forms of sustainable development, while holding oil companies at bay...

...the state and civil society...

...One area was inhabited by an "uncontacted" indigenous population, and the other was considered particularly fragile from an environmental perspective...

...W hile dialogue increasingly prevails in Ecuador, it is not the only option...

...These two institutions, in partnership with the Confederation of Amazonian Indigenous Peoples (representing indigenous organizations from the nine Amazon countries) and developthe Weatherhead Center for International Affairs at Harvard, have undertaken a series of trainings for developindigenous leaders...

...Ecuador is one of the smallest oil-producing countries, but its conflicts are a case in point...

...For their part, themselves frorr mitment to the result, a new c Texaco's neglect oil companies took pains to distinguish Texaco and began touting their comenvironment and communities...

...Bob Williams, Managing EditorNews, "Foreign Petroleum Companies Developing New Paradigm for Operating in Rain Forest Region" Oil and Gas Joumrnal, Vol...

...At the same time, the economic and social pressure mounted by the industry, the government, and to a smaller extent the military, have undermined most attempts to resist oil, and communities have widely opted for dialogue with the companies...

...Similar negotiations were conducted between Maxus (successors to Conoco) and the Huaorani, and were actively promoted by Ecuador's president following the Conoco scandal...

...ployment and job- Texaco's unrestrained development and the colost fifth of the pop- nization rush were devastating for local communities, country's wealth...

...This coming together at the local level was mirrored and supported by an international initiative between Northern NGOs and indigenous federations in the nine Amazon countries, who established the Amazon Alliance in the early 1990s...

...The oil heed to these communities, at best compensating them them part of the at the company's discretion for specific property g impacts on local losses...

...In 1994, the Organization of Indigenous Peoples of Pastaza (OPIP), assisted by Oxfam America, negotiated an agreement with Arco Petroleum that included a number of novel provisions, including local participation in the environmental impact study as well as an environmental management plan for the region, and sharing benefits from oil production in order to finance projects under the management plan...

...oil company Conoco was negotiating exploration rights to a block of rainforest that included one of the most valuable national parks and was home to the Huaorani, an indigenous group hardly touched by Western contact...

...In particular, the Ecuadoran experience highlights new forms of activism provoked by oil, and shows how that activism has forced change upon the government and industry...

...As oil expands deeper into the rainforest, the increasing attenhurdles tion to corporate responsibility and dialogue bring new opportunities and risk...

...Over the course of a decade, negotiations and agreements between companies and indigenous groups have evolved from a limited focus on short-term benefits to addressing company operations, long-term development and the actual process of negotiations...

...In 2000, the government adopted the proposal as part of its negotiating position with public creditors through the Paris Club, and now there is hope for smaller-scale swaps with individual creditor countries...

...a second one of industry or the likely conflict, organizing and protest...

...Additionally, it was most often the young males who represented the communities, as they spoke Spanish and had the most contact with the outside world...

...The local court decision (later ratified by the Supreme Court) held that this practice violated the communities' right to cultural integrity and prohibited the company from negotiating with anyone outside the elected and representative body...

...Ecuador's oil boom began in 1967 covered oil in the eastern Am "Oriente...

...The short-sighted practice of offering gifts and small projects created a so called "worship of begging" described by one anthropologist: "[I]f an oil base is situated in the traditional hunting grounds of the population, it is treated like a new tree [with] large quantities of food that legitimately belong to the local population" and which "has to be harvested quickly and completely, like the fruit that goes bad after a few days...

...Many of the early agreements were mere formalities intended to provide cover for oil operations...

...The "oil men" were eager to sign an agreement that would allow them access to indigenous lands and were willing to offer almost anything the community desired: a short-wave radio, motors for their canoes, solar panels, a health clinic...

...overty rate below Texaco built a vast network of roads into the rainployment of 15...

...Once dispatched as meddlesome provocateurs, the affected communities are now often considered essential "partners" in oil projects...

...1998 and the ratification of an international treaty protecting indigenous rights greatly strengthened community rights to consultation and participation in development as well as environmental, land and social rights...

...At impacts, no outside support the time of Texaco's discovery, the Amazon was a largely and certainly no experience neglected frontier that supported with Western-style indigenous peoples, church missionaries and a dwindling cacao agreements or negotiations...

...Accompanying the lawsuit, a U.S...

...Despite these alternatives, the rush to development and dialogue continues, spurred by an international movement to overcome community and NGO hostility to multinational corporations...

...Texaco refused to be moved by the demonstrations and negative press, and assumed some responsibility for clean-up only under pressure from a later lawsuit...

...Naufragos del Mar Verde: La resistencia de los Huaorani a una integraci6n impuesta (Abya Yala/Confenaie, 1992) cited in Natalie Wray, p. 96...

...But the indigenous leaders-all of them teenage boys-were skeptical: They complained about potential harms, and insisted on more time, more information and more access to lawyers...

...The most progreswhich sive treaties, laws and codes have never contemplated the communities' right to refuse oil in their territories, and negotiations always presume that development will take place...

...At the turn of the decade, CONFENAIE pressed the government to undertake a A member of the Amazon De first-of-its-kind impact contamination...

...Paulina Garz6n, executive director of Centro de Derechos Econ6micos y Sociales, has organized over 50 work- shops in the Amazon and led various campaigns around oil and human rights...

...Second, even assuming a perfect process, dialogue aimed at facilitating oil development inherently raises larger national and global questions...

...To save costs, izon region (the Texaco dumped its toxic wastes directly into the envimillion acres of ronment-an estimated four million gallons a daythe most biologi- causing massive contamination of land and rivers and home to eight dis- an array of health problems among local communities, ital population of including increased rates of cancer...

...As one State Department official put it, "There is no arena in progreswhich corporate conduct and human rights have come under a harsher spotlight than in the extractive industries of oil and mining, in part because of their massive impact on the communities and countries where they operate...

...A local NGO, Acci6n Ecol6gica, led protests aimed to raise awareness about environmental and social harms, to block further development and to ensure clean up and compensation...

...Joseph Kane, Savages (New York: Knopf, 1995) 2 Laura Rival, "Huaorani y Petroleo" in Giovanni Tassi (ed...

...At the official signing of the agreement, the President's daughter was caught on tape comparing Ecuadoran and U.S...

...2 The tremendous leverage exercised by the industry over impoverished communities often succeeded in quelling protests and frequently divided and even corrupted local leaders...

...Ecuador's external debt drives the frenetic search for oil, and the interest on the debt alone consumes almost all oil revenues...

...The natural target of these initial efforts was Texaco, the company responsible for the infrastructure and 90% of all oil produced in the 1970s and 1980s...

...16 (April 2, 1997) 6. Convention Concemrning Indigenous and Tribal Peoples in Independent Countries (International Labor Organization Convention #169...

...Vol XXXIV, No 4 JANUARY/FEBRUARY 2001 47 A Seat at the Table 1 For additional information about oil and indigenous protests in Eduador, see Natalie Wray, Pueblos Indigenas Arnaz6nicos y Actividad Petroiclera en el Ecuador (Quito: Oxfarn/iBIS, 2000...

...After three superficial and shortlived agreements between Occidental and the Secoyas, the latter proposed a code of conduct to govern all future dialogue between the community and the company...

...The Confederation of Indigenous Nationalities of the Ecuadoran Amazon (CONFENAIE), established in 1980, was a critical force in helping organize smaller indigenous groups to obtain land titles and build opposition to oil development...

...A new Constitution in Flaming gases over an oil pit in the Oriente, part of Ecuador's Amazonian jungle...

...Foreign Corrupt Practices Act and removing these leaders and their organizations from the protest movement...

...In the early 1990s, meanwhile, the U.S...

...It is also tinct indigenous groups with a to 100,000, as well as 250,000 recent i industry has focused on the norl Oriente, where it has had devastatin communities and their environmen conditions within this region have 1 the World Bank as "calamitous," v close to 90% and little or no basi sanitation, potable water, or paved ri Oil development in Ecuador-pai between the industry, government an ties-has gone through three overl It...

...15 USCS S 78dd-1 (a)(3), 1998) 5. As the editor of one trade journal comments: "How the petroleum industry is perceived by the various publics and governments in the way it conducts its operations may well decide its future There is already a battle for the hearts and minds of these stakeholders under way with groups whose agenda often is decidedly hostile to the industry...

...rticularly relations nd local communiapping stages: an The 1980s brought rising concerns about oil development, alongside community organizing and protests...

...Amazon communities and NGOs have thus made important gains in challenging industry practices in Ecuador, but they still face daunting odds...

...Early agreements between Occidental Petroleum and the tiny Secoya community provide a case in point...

...The Congress initiated hearings and an investigation of Texaco, and threatened to impeach several government ministers because of their role in oil industry abuses...

...Ecuador's "oil boom" has brought billions of dollars into the country, accounting for roughly half of the national budget since the early 1980s...

...The jungle...

...The elders in the back of the room could not understand the Spanish, but they were clearly agitated by the rising emotions and tension...

...In one of the more brazen examples of this dynamic, Texaco undermined indigenous protests against the company shortly after the lawsuit was launched, by offering certain communities $1 million in "compensation...

...Sucres [the local currency] begin to appear in the mind, and the whole world thinks about how to collect indemnification...

...Texaco also funded a phony environmental company run by indigenous leaders who used the money to finance their successful congressional bids, putting Texaco in probable violation of the U.S...

...Another indigenous organization succeeded in enforcing the principle of "collective bargaining" through a lawsuit...

...Along similar lines, CDES and CONAIE have promoted an ambitious "debt-for-Amazon" swap based on the fact that Ecuador and its public creditors have far more to gain from preserving the rest of the nation's rainforest as a global environmental asset than from con46NACLA REPORT ON THE AMERICAS 46 NACIA REPORT ON THE AMERICASREPORT ON OIL tinuing oil development...

...It also suffers from a weak judiciary, growing ethnic and regional tensions, and an authoritarian government with an active military role...

...lawyers filed a ground-breaking suit against Texaco in U.S...

...The environmentalists watched in dismay as the teenagers ran outside to greet the visitors, eager for information about possible jobs and gifts...

...The Secoyas are an isolated group of approximately 300 members living according to their traditions and entirely dependent upon the rainforest...

...and a third era of dialogue...

...Occidental then flew the leaders to a luxury hotel on the Ecuadoran coast, where they signed another agreement that merely modified some of the material benefits for the community...

...The follow-up has been mixed: OPIP succeeded in establishing a technical team and taking part in the environmental impact study and environmental management plan, but Arco failed to provide funds for the expected projects and has created divisions in the community by funding a new organization and hiring irresponsible subcontractors...

...federal courts on behalf of some 30,000 Ecuadoran plaintiffs...

...Maxus funded a Huaorani organization, then negotiated a number of projects and material benefits with the organization in exchange for access to their territories...

...New laws and technical trainbetween ing for indigenous leaders are a step in the right direcmental tion, but they must be supported by public oversight and continued activism by others...

...Traditional indigenous groups like the Cofan, cy on a volatile the Secoyas and the Huaorani, once numbering in the tens of thousands, were reduced to a few hundred each, when Texaco dis- and the Tetetes disappeared completely...

...In the fall of 1997, a tiny indigenous community deep in Ecuador's Amazonian interior was engaged in fierce negotiations with a team of environmentalists posing as oil executives...

...The Oriente covers 32 pristine rainforest considered one of cally diverse areas on earth...

...Ecuador shares problems common to all oil-producing countries in the South: high levels of government corruption, social inequality, poverty, external debt and political instability...

...Much of the interest in oil was sparked by the government's decision in 1985 to license millions of acres of new Amazon territories to private companies...

...Companies chastened by the protests and wary of provoking local communities (some of whom had taken to kidnappings and sabotage), have sought to build more lasting good will...

...The petroleum industry, perhaps more than any other, has long been surrounded by conflict and protest...

...forest, and a pipeline running the length of the coune population con- try, as well as refineries and hundreds of wells...

...NGOs, media campaigns and meetings with a range of government and industry officials...

...3. Interview with Johnson Cerda, cited in Natalie Wray, p. 86...

...Department...

...The Amazon Defense Front, which grew up around the Texaco lawsuit, now comprises 26 communities with 10,000 people, and provides the most active regional voice against irresponsible development...

...Companies pushed these agreements through with material promises on the one hand and legal, political and even military pressure on the other...

...In the absence of public resources and state intervention, private companies were implicitly or explicitly charged with providing for the local population...

...Instead, the industry has fomented corruption, inequality and political instability, caused irrevocable damages to priceless rainforest and discouraged the pursuit of more sustainable developthe ment paths...

...7. Andy Drumm, "Evaluaci6n de Impactos Socioecon6micos y Culturales de la Siguente Fase de Exploraci6n SIsmica en el Bloque 15" Unpublished study done for Walsh Environmental Scientists and Engineers, Inc, (1997...

...These are problems for U.S...

...While the territories cover less than 10% of the Oriente, they set an important precedent both nationally and regionally...

...A number of groups seek a halt to oil development at least in parts of the Amazon...

...A growing awareness of and support for indigenous rights has provided an important backdrop to these agreements...

...An OAS human rights mission visited the Amazon in 1997 and issued a report strongly critical of the government and oil industry...

...Communities had little understanding about the oil industry or likely impacts, no outside support and certainly no experience with Western-style agreements or negotiations...

...If communities and NGOs can somehow take advantage of these opportunities withized out losing their vigilant and activist edge, there may still be hope for finding a sustainable compromise...

...Beyond the immediate environmental, social and cultural impacts dealt with in some of the more promising agreements, oil development, in and of itself, is in many areas a questionable pursuit...

...4 While the state retains control over all subsurface minerals and the judiciary remains extremely weak, awareness of community rights has played a role in mobilizing protests and strengthening negotiations...

...Texaco paid little immigrants...

...Environmental groups with a traditionally conservationist focus began to work more closely with communities in the Amazon to strengthen campaigns for sustainable development...

...NGO, Natural Resources Defense Council (NRDC), which was trying to broker an innovative scheme that would impose stricter environmental and social policies on oil drilling activities...

...In 1994, under pressure from Congress and NGOs, the Minister of Energy and Mines organized an unprecedented trip of oil executives, indigenous leaders and environmental activists to witness the damage done to the Amazon...

...The military quickly assumed a tomic dependency, share of national oil revenues, and its presence in the tability that date to Amazon, where tensions with Peru ran high, became atistics are telling: intermingled with the task of providing security and y had a negligible support to the oil industry...

...5 Notwithstanding that report, in 1996, Occidental representatives with military escort pressured community leaders to sign an agreement giving the company multi-year access to Secoya lands in return for solar panels, water pumps and medical kits...

...According to leaders of the Secoya Indigenous Organization of Ecuador (OISE) who signed the In Ecuador, dialogue is not the only option...

...Ecuador is on the frontlines of these changing dynamtal, ics, and its fate will foretell the destiny of conflicts throughout South America...

...study of oil operations, and protested the World Bank's role in promoting oil development...

...These groups targeted not only the company, but also the U.S...

...foreign policy...

...Suddenly, commotion erupted just outside the hut as three real oil workers arrived by chance...

...With hundreds of millions of dollars at stake, the negotiators could afford to be generous...

...3 Athird stage in Ecuador's oil development now prevails, characterized by dialogue and negotiations...

...CONFENAIE joined with the other major indigenous organization, Ecuarunari, representing the central region of the country, to form the Confederation of Indigenous Nationalities of Ecuador (CONAIE), a national indigenous organization that has since become a critical political and social force...

...A number of groups continue to seek a halt to oil development at least in parts of the Amazon...

...The front line of the battle is now in South America's rainforest, and even those companies without an investment in that region cannot afford to ignore the outcome...

...The project provided a new focal point for protests, joining CONFENAIE and local environmentalists...

...The idea imposed by the company is that everything comes down to money...

...Speech given at Conference on Corporate Citizenship, Royal Institute of Intemrnational Affairs, London, England (November 8, 1999...

...Two years ago, a larger-scale NGOindigenous campaign supported by the Catholic Church pushed the government to designate 2.5 million acres of Amazon lands as "off limits" to industrial development...

...6 The World Bank and Latin American Organization of Energy have stepped into this fray with an ambitious set of initiatives aimed at promoting community-oil industry negotiations throughout South America...

...The impacts of Texaco's operations were just beginning to reach a national audience, and NACIA REPORT ON THE AMERICAS Communities had little initial period of widespread neglect by the state and abuses understanding about the oil by the industry...

...The es...

...And the Bank is currently funding efforts in countries like Ecuador and Bolivia to establish national regulations for community consultation and negotiations...

...counterinsurgency/"drug war" military package "Plan Colombia," has only aggravated social and political turmoil...

...approaches to pacifying indigenous communities with "trinkets and beads...

...8. The Centro de Derechos Econdmicos y Sociales (CEDS, the Quito offshoot of CESR) and The Institute for Interdisciplinary Science (ISIS) provided workshops and helped elaborate the protocol...

...Arco had discovered that they could more easily enter Shuar territory by ignoring FIPSE and negotiating agreements with individual families and leaders...

...Few indigenous groups had legal title to their lands, and they were almost completely ignored by the state, which e government con- hardly considered them citizens...

...NGO, the Center for Economic and Social Rights (CESR), undertook water testing with a team from Harvard University, and compiled a report providing scientific proof of the contamination and evidence of widespread human rights violations...

...4. The Act prohibits the payment of money to "any person while knowing that all or a portion of such money..will be offered...to any candidate for foreign political office, for purposes of .. influencing any act or decision of such foreign official...

...At the international level, the Sierra Club Legal Defense Fund (now Earthjustice) filed a petition with the !nse Front monitoring oil Organization of American States (OAS) on behalf of the indigenous communities, and Rainforest Action Network campaigned in the international media to raise awareness about the conflict...

...9. Bennet Freeman, Deputy Assistant Secretary for State Bureau of Democracy, Human Rights and Labor, U.S...

...l Laments one indigenous leader: "The people are always thinking about how to take immediate advantage of the relation with the company, without thinking about environmental impacts or long-term development...

...Some companies recognized that superficial agreements like these would provide little protection against future conflict and public criticism...

...Ecuador's experience also illustrates the tensions and struggles within the rapidly expanding field of corporate responsibility...

...Judy Kimmerling, Amazon Crude (New York: NRDC, 1991...

...After discussing the agreement with NGOs, OISE formally rejected it as unfair...

...The actions included demonstrations, marches, take-overs of government offices, shareholder protests with U.S...

...The oil region as it saw fit...

...42REPORT ON OIL newly organized indigenous groups joined with environmentalists to oppose further exploration and development, particularly in indigenous territories and national environmental preserves...

...The protests had a tangible impact on the Ecuadoran government...