Some ‘Oil Vs. Environment’ Case Studies
Fifty percent of Ecuador's national budget is funded by oil earnings and continued oil exploration and production is thought to be necessary to ensure the countries' well being. The country plans to increase production and holds auctions to increase foreign investment. Dependence on oil revenue has hindered Ecuador's environmental enforcement, which in turn has caused damaging consequences to indigenous tribes living in the Amazon region and to the environment in the eastern part of the country. The Indians of Ecuador, located in the Amazon region of Oriente, have joined forces for the past 20 years to resist oil exploration and demand rights to their ancestral lands.
Many of the indigenous tribes in the Amazon region that once numbered in the thousands have been reduced to the hundreds as a result of the pollution generated by oil exploration and other assaults. Water contamination has led to increased risks of cancer, abortion, dermatitis, fungal infection, headaches, and nausea. Their drinking, bathing, and fishing water contain toxins much higher than the safety limits set by the US Environmental Protection Agency.
The oil companies that drilled in the rain forest were responsible for "felling thousands of acres of trees, dynamiting the earth, spilling vast amounts of oil, destroying habitats, and fouling rivers." Fish have died from water pollution and the game the tribes once hunted have retreated deeper into the jungle as a result of the deforestation. The Rainforest Action Network found that Texaco alone spilled 17 million gallons of crude oil, abandoned hundreds of unlined toxic waste ponds, and constructed oil roads that opened more than 2.5 million acres of the forest to colonization. As a result, Ecuador's rain forests are being cut down by oil companies and settlers at a rate of approximately 340,000 hectares a year. The wood is used for construction, roads, fuel and furniture.
The exploration for oil has created numerous environmental problems of all types in the Amazon region. The Amazon basin in Ecuador has the greatest number of plant species of any South American country. The Sierra highlands have been almost completely deforested. Also, the Oriente is a species rich jungle with numerous mammals in danger of extinction. Oil that was placed on roads to cut dust has flowed into rivers. Oil waste in the past was placed in holes in the ground that contaminated the forests and the rivers. Ecuadorian officials estimate that ruptures to the major pipeline alone have discharged more than 16.8 million gallons of oil into the Amazon over the past eighteen years (compared to the 10.8 million-gallon Exxon Valdez spill).
Oil has been an important part of the Nigerian economy since vast reserves of petroleum were discovered in Nigeria in the 1950s. Revenues from oil were 219 million Naira in 1970 and it increased to 10.6 billion Naira in 1979. Shell Oil operates many of its oil facilities in the oil-rich Delta region of Nigeria. The Ogonis, an ethnic group that predominates in the Delta region, has protested that Shell's oil production has not only devastated the local environment, but has destroyed the economic viability of the region for local farmers and producers. The Nigerian Federal Government, on the other hand, has been charged with failing to enact and enforce environmental protections against oil damage by Shell and other oil companies. Furthermore, many Ogonis have been harassed and even killed by the Federal government for organizing protests and threatening sabotage of oil facilities.
Oil production in Nigeria has had severe environmental and human consequences for the indigenous peoples who inhabit the areas surrounding oil extraction. Nigeria's export of 12 million barrels of oil a day comes from 12% of the country's land, and indigenous minority communities in these areas receive no economic benefits. Indigenous groups are actually further impoverished due to environmental degradation from oil production and the lack of adequate regulations on multinational companies, as they become more vulnerable to food shortages, health hazards, loss of land, pollution, forced migration and unemployment.
The social and environmental costs of oil production have been extensive. They include destruction of wildlife and biodiversity, loss of fertile soil, pollution of air and drinking water, degradation of farmland and damage to aquatic ecosystems, all of which have caused serious health problems for the inhabitants of areas surrounding oil production. Pollution is caused by gas flaring, above ground pipeline leakage, oil waste dumping and oil spills. Approximately 75% of gas produced is flared annually causing considerable ecological and physical damage to other resources such as land/soil, water and vegetation. Gas flares, which are often situated close to villages, produce soot which is deposited on building roofs of neighboring villages. Whenever it rains, the soot is washed off and the black ink-like water running from the roofs is believed to contain chemicals which adversely effect the fertility of the soil. Gas pipelines have also caused irreparable damage to lands once used for agricultural purposes. These pipes should be buried to reduce risk of fracture and spillage. However, they are often laid above ground and run directly through villages, where oil leaks have rendered the land economically useless.
Oil spills and the dumping oil into waterways has been extensive, often poisoning drinking water and destroying vegetation. According to an independent record of Shell's spills from 1982 to 1992, 1,626,000 gallons were spilt from the company's Nigerian operations in 27 separate incidences. Of the number of spills recorded from Shell - a company which operates in more than 100 countries - 40% were in Nigeria.
Shell is also being accused of engaging in "widespread ecological disturbances, including explosions from seismic surveys, pollution from pipe-line leaks, blowouts, drilling fluids and refinery effluents, and land alienation and disruption of the natural terrain from construction of industry infrastructure and installations". For example, oil spill contamination of the top soil has rendered the soil in the surrounding areas "unsuitable for plant growth by reducing the availability of nutrients or by increasing toxic contents in the soil.” Gas flaring, on the other hand, "has been associated with reduced crop yield and plant growth on nearby farms, and disruption of wildlife in the immediate vicinity". Shell and other oil companies have developed an easy and inexpensive way to deal with by-products from oil drilling: "indiscriminate dumping".
The Andes mountains in Colombia have become the newest oil hot spot with several international companies drilling in the region. Oil drilling is a profitable business for the exploring corporation as well as the Colombian government which receives a large sum of money for each barrel of oil recovered. However, the process is not without violence nor criticism from environmental groups. The Marxist guerrillas repeatedly interrupt production through the use of terrorist tactics including bombings and kidnappings. Environmental groups challenge Colombian laws regarding environmental degradation due to the methods of oil exploration and extraction primarily caused by foreign corporations.
In 1993, British Petroleum and its partners located oil beneath the eastern plains in the Andes Mountains. The company predicted "it could be worth $3 billion a year in exports - the government hopes for $5 billion - by 1997." The Colombian government also commissioned British Petroleum to continue exploring for oil in its frontier areas in 1995.
Not everyone in Colombia is pleased that the oil companies are drilling more and more in their country. The drug cartels, peasant groups and paramilitary groups have wrecked havoc on the oil-pumping stations. Many of the oil wells are located in the "stomping ground" of the Medellin drug cartel as well as its competitors. The area is also the home to "the less publicized `emerald wars' (Colombia produces 60 percent of the world emerald supply), to three separate groups of Marxist guerrillas and to an increasingly terroristic national police force seeking to quell the turmoil."
One reporter described a British Petroleum drilling site in the eastern foothills of the Andes as "an armed camp, swarming with khaki-clad, rifle-toting guards and surrounded by machine gun emplacements and two rows of flood-lit razor wire." The fortress is necessary in order to quell some of the violence caused by the Marxist guerrillas in the region who are protesting the eradication of coca crops. As it is difficult to halt the coca eradication process, the guerrillas attack the oil sites and pipelines as a demonstration of their dissatisfaction with the government's actions. During the last nine years, "leftist guerrilla squads have dynamited Colombia's main oil pipeline 346 times, spilling more than 1.2 million barrels of crude oil. The guerrillas seek publicity, rural development, and nationalization of the oil industry." The guerrillas also demand increased spending "for social programs in areas where the oil is produced."
Colombia's Environment Minister said that "no one has ever calculated how much the FARC owes" due to fears that the calculation would encourage the guerrillas to increase their destructive actions. During the past ten years, pipeline attacks by the guerrillas are estimated to have cost Colombia "about $1 billion in lost oil sales." Ministry studies examining the years 1989 through 1991 "found that guerrilla pipeline bombings polluted 375 miles of creeks and rivers and fouled 12,500 acres, ranging from tropical wetlands to Andean watersheds."
On 20 November 1994 a consortium of oil companies signed a contract with the government of Azerbaijan. The consortium, led by British Petroleum, is to invest $8 billion for oil production over a period of 30 years. The consortium believes it can extract up to 4 billion barrels of oil from three wells in the Caspian Sea. However, a problem has developed dealing with the route the oil will take to the world market. In addition, there are many environmental aspects to the issue. They all basically deal with the possibility of damage or destruction of the pipelines. This is due to the fact that this is a politically volatile region of the world.
Before the consortium could finally have the agreement signed, there was a problem that required immediate attention. Their plan is to sell the oil on the world market. As such, the oil must be transported from Baku, the Azerbaijani port of origin to potential world clients by way of the Turkish port of Ceyhan. There were 3 possible routes to be taken. The first involves constructing a pipeline from Baku to the west in neighboring Georgia. From there it would be shipped to Ceyhan. A second would involve constructing a pipeline that would travel south through Armenia into Turkey to Ceyhan. Finally, an existing pipeline could be used by sending the oil north to the Russian port of Novorossiysk, from there it would be shipped to Ceyhan.
The choices to be made are thus influenced by a myriad of details. However, there is one rather important issue which has not been discussed, the environment. The environment serves to be severely damaged if any number of very likely events occur. Firstly, the threat of terrorism on every possible pipeline route is very high. The first route is through Georgia, which has not yet rid itself of the horrors of civil war. Thus there is the possibility of the pipeline being targeted by the combatants. The second route, through Armenia, is the sight of an almost 7 year clash with Azerbaijan over the disputed Nagorno-Karabakh region. The final route through Russia directly traverses the Chechen war zone. In addition, the Russian oil pipelines are in a horrendous state of upkeep, with over 700 spills per year. There is also the likely possibility that the Caspian Sea itself will be polluted by any number of possible mishaps. Finally, if one of the first two oil routes were chosen, oil would have to be shipped to Turkey through the already overcrowded Bosporus Sea channel. Thus animal or fish life, and the very ecosystem itself, could be adversely affected by pipeline or shipping spills.
These options leave much to be desired environmentally. The outcome of an accident such as an oil spill in the area of the Caspian or Black Sea, or in the pipeline system on land would undoubtedly have a high impact on and effect both the composition and scale of the wildlife and its habitat.