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Why are Ecuadorian oil firms talking about building a road into Yasuni-ITT? PDF Print E-mail

The Guardian

"The transport of materials will be done by helicopter and by river."

That was what Ecuador's Minister for Strategic Sectors, Rafael Poveda, was quoted as saying, in the May 2014 edition of Eco-Americas, about exploiting the Ishpingo, Tiputini and Tambococha (ITT) oil fields in the Yasuni National Park in the Ecuadorian Amazon.

"Officials promise Petroamazonas [an Ecuadorian state oil company which holds the licence to operate in the ITT fields, called Block 43] will use the latest safeguards," Eco-Americas reported. "Strategic Sectors Minister Rafael Poveda told lawmakers recently that all crude-transport infrastructure will be underground and will meet the highest standards for quality, security and environmental protection."

Is that really what will happen? I ask for several specific reasons: 1) Endeavours by Ecuadorian citizens to stop operations in ITT, including a lawsuit filed by Kichwa organization ECUARUNARI and an attempt to force a referendum by a collective of civil society organizations called YASunidos; 2) Publication of hi-res satellite images last week allegedly revealing that Petroamazonas, in neighbouring Block 31, has not only failed to meet oil industry best practices but violated Environment Ministry conditions by building a road – the high-impact alternative to using only helicopters and rivers – and permanent bridge structures more than 20kms into Yasuni, to which Petroamazonas responded by claiming it has not violated any such conditions and has built a 'sendero ecologico', i.e. an 'ecological trail', not a road, which will be 'revegetated' when the construction phase is over; and 3) Two presentations given by Petroamazonas and an Ecuadorian oil services company, SERTECPET, at an event late last month in Ecuador's capital, Quito, held by the Society of Petroleum Engineers (SPE). Indeed, Poveda gave the closing keynote presentation at that event and reiterated that "best practices" will be used to develop ITT – a different message to what had been said in previous presentations.

Bill Powers, chief engineer at E-Tech International, a USA-based consultancy, was at the SPE event. Here he tells me what he heard there and why he found it so disturbing:

DH: What was the name of the event?

BP: The title was 'Applying the Best Technologies in Extremely Sensitive Environments.'

DH: Was there a presentation about ITT?

BP: Yes, there was a presentation about the development of ITT, given by the operations manager from SERTECPET.

DH: What was the title?

BP: 'The ITT Field, An Easy way to Monetize its Development.'

DH: What was the general gist?

BP: The gist was the options that SERTECPET and the Ecuadorian government, or Petroamazonas, have for developing ITT oil. That involved SERTECPET giving an overview of what routes – what road routes – could be used to access those deposits.

DH: How many different routes were there?

BP: Three. These concessions are in a row. There's Block 16, and then to the east there's Block 31, and then to east of Block 31 there's ITT, Block 43. There's already a road that goes through most of Block 16, in an existing oil development, and then there's the new, controversial road in Block 31 [allegedly revealed in the satellite images in the report published last week by researchers from the Amazon Conservation Association and the University of Padova]. The SERTECPET presentation in part looked at the possibility of extending these roads into ITT – to bring in heavy construction materials, operating materials, and personnel.

DH: Why do you think this is particularly significant?

BP: It's significant because ITT has been such a focus of international interest in terms of 1) preserving it without the oilfields being developed [a scheme known as the "Yasuni-ITT Initiative", which Ecuador's government publicly abandoned in August 2013] and 2) the promises that if any development does occur in ITT it would be with industry best practices. In the jungle, one basic best practice is to not build roads. Once you build a road you provide access to outsiders who may want to log valuable wood, hunt or capture rare animals, or squat on land that has belonged historically to indigenous peoples. You don't build roads. You go in with helicopters and with river transport. The closing keynote presentation was done by Rafael Poveda, the Minister for Strategic Sectors, who made it clear that ITT development would be using best practices, whatever those best practices cost, and that that cost would be met. That left somewhat of a question mark. A company that appears to be the company that will actually do the drilling and build the platforms is talking about what road route will be extended into ITT, but then there was the higher-level commitment, by the minister, to best practices. The minister appeared very sincere, and apparently has made it clear to Ecuadorian lawmakers that ITT will be explicitly helicopter-and-river-transport-only. It would be of great value to get some clarity on this. Is it going to be helicopter-and-river-transport-only, or is it going to be a traditional high-impact operation where they build a major road through uncharted terrain and expose it to potential degradation?

DH: This isn't something new, is it? 'No roads' has been best practice for years.

BP: Correct. 'Offshore inland' – that's the industry terminology which means applying offshore development to the jungle by isolating operations to the drilling or production platforms, or an additional processing facility, and the pipeline. But those are discreet points with no roads connecting them. The right-of-way for the pipeline is opened to build it and then it's closed. It doesn't become a road. The jungle grows back. Minimal damage, minimal impact. That concept has been around for a generation.

DH: Why do you think a company wouldn't use the 'no road', offshore option?

BP: There was a presentation at the SPE event by Petroamazonas on Block 31. The presenter was quite honest and straightforward about the fact it was cheaper to put in a road than to rely on helicopters. That's the reason. A couple of comments were made about the noise of helicopters bothering wildlife and the fact they have some limits – meaning, not flying them in foul weather or at night – but there's no doubt here. It may cost a little more, but the cost of production might be US$20 a barrel for these projects and the market price is around US$100 a barrel. The fact they may pay some additional amount for helicopter-and-river-only operations pales in comparison to the income from production.

DH: Can you remember anything else about the SERTECPET presentation?

BP: The fact that the presentation was focused on what land route would be used to develop ITT – that was the main takeaway for me. But I would hope that that's not what's going to happen. The question is: Just how important was that presentation? It strikes me as illogical they'd be given such a platform if they're not the company that is going to develop ITT.

DH: This chimes with the recent report [with the satellite images] claiming that the Environmental Impact Assessment [EIA] for Block 31 permits a 10 metre flow-line, but that Petroamazonas has built something much wider. That report expresses concern that Petroamazonas might do exactly the same in ITT.

BP: Petroamazonas did speak about Block 31 [at the SPE event] and they did confirm the road transport into it. They didn't touch on the EIA, by the way, or what was approved or what wasn't approved – just that road transport into Block 31 was the most efficient way to get the job done and they had the intention of applying the same development philosophy in ITT.

DH: That was the impression you got?

BP: Yes. And they weren't dodging the issue that Block 31 is a heavy road transport development model which they feel is appropriate for ITT.

DH: Did they use the word 'road', 'carretera'?

BP: They tend to use the term 'sendero ecologico.' But 'sendero ecologico' to them is a heavy truck transport route. We should be explicit about that. The question was, 'Will it be road-based development in ITT?' and the response was that they would follow the same model in ITT as Block 31. That was Petroamazonas's position.

DH: 'A heavy truck transport route'?

BP: Yes. They're not denying the satellite images showing heavy trucks moving along their sendero ecologico. The issue isn't whether it's 10 metres wide or 25 metres wide. You can move two giant vehicles on a 10 metre-wide track. The issue isn't the width. The issue is: Are you conditioning it to run heavy vehicles or is it going to be unsuitable for vehicles? When you build a proper flowline not intended to be a vehicle route you have to put in erosion control features that would prevent vehicles from moving. They just couldn't move on a true sendero ecologico. The term sendero ecologico is good PR. The civilian looks at it and thinks, 'Well, ok.' But it means nothing. Does it mean a herd of elephants can roll down it? Well, yes, and a herd of 18 wheeler heavy vehicles could roll down it too.

SERTECPET could not be reached for comment.