Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Jiyukam Irar Miik of Peru visits the Athabasca oil sands area of Northern Alberta. (Caroline Bennett for The Globe and Mail/Caroline Bennett for The Globe and Mail)
Jiyukam Irar Miik of Peru visits the Athabasca oil sands area of Northern Alberta. (Caroline Bennett for The Globe and Mail/Caroline Bennett for The Globe and Mail)

The age of extreme oil: 'This used to be a forest?' Add to ...

“You're never going to stop the oil companies,” he said. “So you've got to try to get the best deal you can out of them.”

“What kind of future do you see for your people?” Mr. Ayui asked.

“It's not very bright,” Mr. Kreutzer said in a low voice, “but we've gotten used to it. We recognize that the oil will never stop. If we have to relocate in the future, then that's just what we'll do.”

The battle for Block 64

“I have said repeatedly that we will not work where we do not have majority community support,” John Manzoni, Talisman's CEO, insisted at the company's annual meeting on May 1. He was responding to the four Achuar, who showed up wearing headbands of toucan feathers (killed, not found) and bead vests draped over their shoulders like ammunition belts.

One by one, they stood during the question period to demand that the company leave their land. Their complaints were translated by Gregor MacLennan of Amazon Watch, the San Francisco-based organization that sponsored their journey.

“We respect your right to deny oil production on your territory,” Mr. Manzoni replied. “But we ask you to respect others' rights who have pro-actively asked for us to work with them in their territory.”

This is where things get tricky enough to warrant a brief history: In 1995, the Peruvian government took out a map and delineated Block 64, a 760,000-hectare patch of rain forest along the northern border with Ecuador, between two rivers in the Achuar heartland.

Oil rights were first leased to Arco, a U.S. oil company, without a word to the Achuar; Arco did nothing with its lease, and in 2000, Block 64 passed into the hands of another American company named Occidental, commonly known as Oxy.

As every Peruvian in the Amazon knew, Oxy had been pumping oil since 1972 on a lease beside another river; in three decades, Oxy had dumped one million barrels of contaminated tailings into the waters, poisoning the food supply of Achuar fishermen with heavy metals. Thankfully, before Oxy could do it all over again next door, it sold Block 64 to Talisman in 2007.

“I don't think the industry showered itself in glory in the past,” Mr. Manzoni allowed in a press conference after the meeting. “But Talisman has cleaned up a lot of that.”

Talisman is probably the best oil company an Amazon Indian could ask for, in both environmental and social terms. It has built medical clinics, donated boats, paid university tuitions and installed satellite phones in 66 indigenous communities with which it has signed “good neighbour” agreements, at a price of $3.7-million from 2008 to 2011.

This year, it allocated $3-million more to a fund for the villages to spend as they see fit. In exchange, the 66 communities signed off in support of Talisman's bid to pump $4-billion worth of oil from their land.

Unfortunately for Talisman, most of those communities are outside Block 64; most aren't even Achuar. Its Peru corporate-affairs manager, Gonzalo Delgado, acknowledged as much when pressed. But every one of the 44 communities that sent Mr. Ayui to Canada lives in the concession.

Nevertheless, in the five years since Talisman bought the rights to Block 64 and set about earning “free, prior and informed consent” of “every community directly impacted,” the company has wrapped up its exploration; it knows exactly where the oil is, and how much, and it is poised to move into production. According to plan, oil will be flowing by 2015. The wells that will bring it up from six kilometres beneath the Morona will include reinjection facilities that dump contaminated tailings underground rather than into the river, quadrupling each well's price tag.

This “is the latest technology,” Mr. Delgado said. The company is betting that it's good enough.

‘Where are all the birds?'

From Fort McMurray, Mr. Deranger took the Achuar to visit the Fort McKay First Nation, half an hour north. The drive took them past the oldest oil-sand facility, operated by Suncor Energy Inc. since 1967. They pulled over by the highway for a look.

Single page

In the know

Most popular videos »

Highlights

More from The Globe and Mail

Most popular