Rumble in the jungle: international oil companies meet opposition from indigenous people in the Amazon

What happens when international oil companies, backed by a host government, meet opposition from indigenous people in the Amazon

As the Amazon sun slowly heats up around them, Marlon Santi addresses members of his community under the shade of a zinc roof supported by thick wooden posts. Speaking in Quichua, Ecuador's most widely spoken indigenous language, the president of Sarayacu updates his constituents on some of his most recent meetings, including those concerning their international legal fight against oil exploration and extraction on Sarayacu territory. While he speaks, several clusters of yellow and orange toucan feathers sway from a beaded headband over his long black hair. The skin around his eyes is painted with dark blue pulp from a tropical seed.

Some 150 residents of this community in Ecuador's upper Amazon basin region listen to Santi in the shelter at the edge of the central plaza. A Roman Catholic church, a handicrafts store and the local council's headquarters also ring the square of red earth that will double as a soccer field later in the day. Two large antennas, supported by bamboo poles, reach high into the clear blue sky. They're attached to a solar-powered radio that is Sarayacu's only real means of communication with the outside world. There is no road; small planes make the 25-minute trip from the nearest town, Puyo, only on demand, and a five-hour trip down the Bobonaza River in dugout canoes with outboard motors is no longer an option due to attacks from oil industry supporters.

River restrictions are inconvenient but not crippling, given Sarayacu's high degree of self-sufficiency. The almost 1,000 residents–who live in several settlements across the 1,350-square-kilometre territory–gain their livelihood from hunting, fishing, farming and gathering fruits and fibres. Elementary and secondary schools are now staffed with bilingual teachers (Quichua and Spanish)–most of them from Sarayacu–and there is even a university education program. Homes, usually built on posts, have thatched roofs and separate, large kitchens where food is cooked over wood fires. Bags of rice and corn occasionally arrive on five-seater planes, and clothing is factory-made, as are the rain boots and shoes that protect feet from mud and insects. Potable water comes directly from local springs.

It's a good life, but hardly idyllic. Sarayacu residents are worried: last year the Ecuadoran government declared a renewed commitment to oil extraction for the next 25 years–despite the fact that, according to development banks, the nation's economy is too dependent on the resource. Ecuador, which has one of the largest reserves in Latin America, has also seen its debt increase as oil revenues have risen. Meanwhile, high levels of corruption and low levels of transparency–also noted by the banks–make many Ecuadorans wonder just where much of the benefit has gone. Complained one woman at the Sarayacu community meeting: “The government says it needs oil to pay the debt. But what do we indigenous peoples have to do with the national debt? What has the government ever spent on us?”

The government did recognize Sarayacu (officially the Autonomous Territory of the Original Kichwa Nation of Sarayaku) with a property title in 1992, but that did not include subsoil rights. The community is now in the midst of what could be a fight for its very survival, battling both the government and Argentine oil giant Compañía General de Combustibles, which, in 1996, was awarded a 2,000-square-kilometre concession, Block 23, on which 65% of Sarayacu sits. CGC has wanted to explore the area ever since. Burlington Resources of Texas owns 50% of the operation. And a new pipeline, in which Alberta's EnCana Corp. is the majority shareholder (although the asset's pending sale was announced late October), would, in theory, transport oil from Sarayacu and other parts of the Amazon, over the Andes to a Pacific port. EnCana also has interests in five other “blocks” in the Amazon.

But Sarayacu's resolve has thrown a wrench into development plans for Block 23, causing the Ecuadoran government to issue a declaration of force majeure in 2003. Operations are also on hold in neighbouring Block 24, operated by Burlington, due to opposition from other indigenous peoples.

As is the case elsewhere in Ecuador, demonstrations, protests, letter writing and direct action have been part of Sarayacu's strategy to keep CGC out. As oil workers and military personnel have come into their territory, Sarayacu residents have also sabotaged and stolen equipment, and detained soldiers and workers. CGC brought charges against several members of the community for vandalism, but the charges were dismissed a year ago by a provincial judge. Sarayacu has also started a legal process, lodging complaints against the government with the Inter-American Commission on Human Rights, an independent body of the Organization of American States, which in the past few years has received an increasing number of petitions related to indigenous peoples and human rights.

In October, the commission accepted Sarayacu's petition, signalling what could be a lengthy battle that could end up in the Inter-American Court of Human Rights, also an independent OAS body. The case raises important questions about the extent to which consultations must be carried out, according to University of Arizona law professor S. James Anaya. While international conventions and court decisions have made a number of statements about a state's duty to consult, where subsurface rights are concerned the full extent of that duty is not yet clear. A decision in favour of Sarayacu, explains Anaya, “would not necessarily overturn a state's proprietary rights” to the subsoil. “But it would confirm that states must engage in very vigorous consultation and mitigation processes.” Anaya adds that the Ecuadoran government would have to undertake consultations with Sarayacu, which could lead to termination of the oil concession, and leave Ecuador obliged to compensate the concessionaire for losses.

Santi says CGC has used a number of strategies to win over his community, including offers of community projects, forging of signatures on petitions in favour of the company, and attempts to bribe the leadership. He maintains the impact of oil exploration is just not acceptable. “If other peoples want to welcome the oil companies, that's fine for them,” he says. “But for us, our land is not negotiable. Without our territory, we would lose everything. It would be like selling our mother, and for us this concept doesn't exist.” He fears the effects of seismic testing, deforestation, pipeline spills and waste from extraction, and notes how roads have brought squatters and prostitution to native lands further north where drilling has been going on for several years.

Oil extraction in the Amazon began in 1972 after Texaco (now ChevronTexaco) discovered the fossil fuel near Ecuador's northern border with Colombia. After 20 years of drilling as a minority partner with the state oil company, the U.S. firm is now embroiled in a billion-dollar lawsuit over environment and health issues. At the time, there was little in terms of environmental legislation. (Ecuador's Ministry of the Environment was just established in 1996.) In the northeast, where oil drilling began, a number of indigenous peoples are making demands for reparations and mitigation of environmental damage from other companies. Needless to say, that has not helped oil companies who have their eyes on concessions further south today.

The oil companies stress the state-of-the-art technology they would employ, while the Ecuadoran government talks of oil revenue, jobs and development. Meanwhile, those in favour of oil accuse Sarayacu leaders of being manipulated by outside non-governmental organizations, or NGOs. Santi, however, remains defiant. He notes Sarayacu already drove the army out in the 1940s, and more recently the Summer Institute of Linguistics, a Christian fundamentalist organization that uses literacy programs to convert natives.

Many presume that an attack on Santi last year at the bus station in Quito, Ecuador's capital, was a result of Sarayacu opposition. The community's Quito lawyer was also assaulted on a separate occasion in 2004. In an unusual move, in May 2003, the Inter-American court ordered Ecuador to protect community members and leaders while their petition was being evaluated, and now a police officer sits outside the Sarayacu office in Puyo, the capital of Pastaza province. There, cellphones and the Internet have become important tools in Sarayacu's struggle.

The head of CGC operations in Ecuador, Ricardo Nicolás, maintains Sarayacu leaders have committed “terrorist” acts and says he never imagined that CGC would face such militancy when it won the concession. “In the contract or information that the government of Ecuador gave us prior to bidding, it did not indicate the high level of danger these people posed,” Nicolás says, admitting that CGC merely informed the community it was coming, but did not consult with leaders before the arrival of oil workers. “That was never done because it didn't have to be done; it wasn't in the contract,” Nicolás says. “Throughout national territory, there is freedom of circulation; we informed them that [an environmental impact] study would be done and that we had proper authorization, and as in any other part of the world, we began work.”

In other parts of the world, more than 20 private banks, including the Royal Bank and the Canadian Imperial Bank of Commerce, have adopted the Equator Principles. They are a voluntary set of guidelines modelled on International Finance Corp.'s 1998 Safeguard Policies (now under review) that address a number of issues, including a project's impact on indigenous peoples. Currently, the World Bank is revising its lending policies toward extractive industries, as well as its indigenous policies, and both the United Nations and the OAS are drafting declarations on the rights of indigenous peoples.

Governments are also increasingly recognizing aboriginal property rights in their constitutions and legislation, as well as ratifying the International Labour Organization's Convention 169 on Indigenous and Tribal Peoples. The pact recognizes rights of ownership and possession of traditionally occupied land, and calls for meaningful government consultation with indigenous peoples. Ecuador signed in 1998, and was criticized by the UN last year for granting concessions without full consent of concerned communities. At least 25% of Ecuador's population is indigenous.

Evan Fox-Decent, a specialist in human rights at McGill University, says consultation under ILO 169 means more than a government just informing a people about its intentions. “Meaningful, accessible public consultations in situ must take place. In practice, this means the state must ensure full disclosure of relevant information to indigenous parties prior to the awarding of concessions,” he explains. “If the people say no, the state must demonstrate that a public good is being pursued, that the means being pursued to achieve that end are proportional to the end itself, that there is minimal impairment of indigenous interests, and that there is appropriate compensation.”

According to Sarayacu's lawyer José Serrano, an important part of his clients' argument is a precedent-setting Inter-American Court decision in 2001. It was against Nicaragua, which had granted a logging company a forestry concession on aboriginal territory. After all legal remedies in Nicaragua were exhausted, the case ended up in the Inter-American system where the court ruled Nicaragua had violated the natives' property rights, as well as a number of other rights inextricably linked to their land. It was the first court decision to link human rights to indigenous land rights.

Serrano argues there can be no division of rights above and below the land's surface. “This is a legal division that for indigenous people makes no sense,” he says. “We cannot interpret territory as just from the surface upward. This is about the integrity of the territory that for indigenous peoples includes water and rivers, sacred sites, animals and plants.”

Jorge Barbaño, sub-secretary of the hydrocarbon division at Ecuador's Ministry of Energy and Mines, says he's not worried about a subsoil challenge. He acknowledges problems have arisen due to a lack of consultation in the past, but assures that Ecuador has just finalized a new policy for consultation with indigenous peoples that will be applied to future concessions. “This prior consultation will, of course, affect social groups so that they become aware of the advantages to be obtained, and so that they can benefit from the recuperation of petroleum in a sustainable manner that benefits these communities,” he says.

Barbaño is clear that extraction will take place, despite objections. “The consultation will be undertaken with sociologists, psychologists and anthropologists who will act as a bridge so that [indigenous people] understand government policies, but in a way that respects their customs–settlers and native peoples in the area where drilling will take place–in order to develop a close relationship based on progress for these people, as well as the other 13 million Ecuadorans.”

As the government's 25-year plan and Sarayacu's legal action both move forward, some observers–such as the independent human-rights ombudsman's office in Pastaza and the Canadian Embassy–anticipate an increase in human-rights violations related to the oil industry in general. (The embassy advises Canadian firms working here to obey all Ecuadoran laws, and to adopt the Organization for Economic Co-operation and Development's guidelines for multinational enterprises.) Sarayacu's resolve against the CGC and government seems clear, though, and at the aforementioned community meeting residents showed interest in learning more about the Nicaraguan court decision and other cases where aboriginal peoples have had success. There was talk of mapping their land and its resources, and of an awareness-raising trip to Argentina. Says Santi: “It is ludicrous to think that you can come in here and get the oil without destroying what is on top. And without our territory, we would lose everything: our culture, our life.”