Oil firm backed by Scots investment company pulls out of Peruvian Amazon project

An oil firm backed by a Scots investment company and accused of endangering an Indigenous group under lockdown in the Peruvian Amazon, has pulled out of a controversial exploration project.

We reported last week that Standard Life Aberdeen, based in Edinburgh, invests in Chilean company Geopark, which has been at the centre of a dispute over its plans to extract oil in the Loreto region of Peru.

The Wampis Nation, a local group who fear that Covid-19 could be genocidal for Indigenous peoples as the pandemic spreads in the Amazon, took legal action against Geopark, accusing its workers of entering its territories despite a state of emergency in Peru due to coronavirus.

The Wampis filed a criminal complaint against Geopark in May, alleging the firm was putting lives at risk amongst the communities of the Morona River.

The Indigineous group also called on Standard Life Aberdeen to stop investing in Geopark.

Geopark, which strongly denied the allegations made by the Wampis, receives investment from Standard Life Aberdeen. According to filings on 31 March, the Edinburgh firm’s shares were valued at around £12m.

Geopark has now said it will no longer continue with its plans to extract oil in the area. The company said in a statement it had informed Petroperú, a firm owned by the Peruvian state, that it was pulling out of the project.

In 2014 Geopark and Petroperú formed a consortium to explore and exploit Lot 64, with the Chilean firm taking a 75 percent stake. The objective was to achieve 10,000 barrels a day in the first stage of exploitation by early 2021.

Announcing it was pulling out of the deal, Geopark said: “On July 15, 2020, GeoPark notified Petroperu and Perupetro of its irrevocable decision to retire from the nonproducing Morona block (Block 64) in Peru, due to extended force majeure (contractual clauses that offer relief from performing some or all of the obligations in a contract) which allows for the termination of the license contract.”

This news is an important achievement for Amazonian indigenous peoples such as the Wampis and Achuar who have publicly established their commitments for the conservation of the territories of life and respect for human dignity. Wampis Nation Autonomous Government

Petroperú’s first partner in the area, Talisman of Canada, gave up in 2013 having failed to achieve the consent of the Indigenous population.

State-run Petroperu is now sole stakeholder in the block, aka Lot 64.

Geopark’s announcement was welcomed by critics of the Lot 64 project, but oil extraction in the area is still a possibility.

GTANW (Wampis Nation Autonomous Government) said: “This news is an important achievement for Amazonian indigenous peoples such as the Wampis and Achuar who have publicly established their commitments for the conservation of the territories of life and respect for human dignity.”

Forest Peoples Programme, a group which campaigns on behalf of Indigenous Groups, said: “ So far, we know that Geopark is leaving, although 25 per cent remains to the Peruvian State-run oil company, which has 30 days to respond if it assumes the rest of the percentage.

“Nevertheless, one thing is clear, the Lot is not cancelled. That means that Wampis and Achuar are very aware that future potential GeoParks may come, especially under a situation where the Lot 64 is key for the (Peru’s) Ministry of Energy. We will evaluate and follow-up reactions coming from the oil sector in the next following days.”

Oil firm backed by Scots company allegedly put Indigenous people at risk in Peru

Ric Lander, of Friends of the Earth Scotland, said: “This is fantastic news for the Wampis Nation. They have successfully defended their basic human rights from this company.

“Sadly this is not an exceptional case. Fossil fuel companies like Geopark frequently steamroller over indigneous rights in their quest for more and more oil, and their industry appears either ignorant of or indifferent to their role in driving climate breakdown.

“To stop these abuses and slow the worst effects of climate change Scottish investors need to divest from fossil fuels.”

Petroperu said in a statement: “On July 15, 2020, Geopark Peru SAC has informed us that it has irrevocably chosen to withdraw from the license agreement for Lot 64, in which it has 75% participation. This option to withdraw is exercised in application of Clause 8 (c) of the agreement of terms and conditions for the joint investment in the Morona Block.”

The Peruvian state firm added it has 30 days to decide whether to “fully assume the operation of the license contract for Lot 64”.

Aberdeen Standard Investments did not reply to our request for a comment. But the company said previously it had engaged with Geopark over the issue. “We regularly engage with all companies we invest in to fully understand the impact its operations have on its employees and the environment,” it said.

“We have recently had conversations with GeoPark’s management team, including the effect of Covid-19 on its business and would expect management to take decisions to protect employees of the company as well as the local community.”

This story was published by The Sunday Post on 19 July 2020.

Images thanks to GTANW/Jacob Balzani. 

Leave a Reply

Your email address will not be published. Required fields are marked *

Hi! To read more you need to login.
Not a member yet? Join our co-operative now to get unlimited access.
You can join using Direct Debit, payment card or Paypal. Cancel at any time. If you are on a low-income you may be eligible for a free sponsored membership. Having trouble logging in? Try here.
Hi! To read more you need to login.
Not a member yet?
Hi! You can login using the form below.
Not registered yet?
Having trouble logging in? Try here.