California is the world’s number one importer of Amazonian oil, report finds

Tracking oil exports in the Amazon identified that the majority of Amazonian oil comes from Ecuador and ends up in the hands of large California-based corporations.

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Oil storage tank in Romania. Credit: Clean Air Task Force
  • California is the biggest importer of oil from the Amazon rainforest, with Ecuador being the largest exporter, a report from Stand.Earth and Amazon Watch finds.
  • The report comes months after Indigenous organizations filed a motion to protect 80 percent of the Amazon by 2025 and the Ecuadorian president announced plans to double the country’s oil production.
  • Ecuador’s ministry of the environment and water told Mongabay that it is “encouraging extractive activities to compensate for biodiversity loss” and that it is adapting secondary legislation to further comply with Indigenous rights and environmental regulation.

California is the world’s largest driver of oil exports in the Amazon, researchers of two environmental NGOs, Stand.Earth and Amazon Watch have found. By tracking crude oil exports from four Amazonian countries, Ecuador, Peru, Colombia and Brazil, into the global market, they identified that the majority of Amazonian oil comes from Ecuador and ends up in the hands of large California-based corporations. The exact number is 89 percent.

“Typically, supply chains fan out on the demand side, but this supply chain is very squarely Ecuador to California-focused,” Angeline Robertson, Stand.Earth’s lead researcher of the report, told Mongabay in an email.

The name of the report, “Linked Fates”, is based on researchers’ conclusion that “frontline communities and Indigenous nations [both] in the Amazon and California are bearing the brunt of oil extraction’s pollution and destruction,” Robertson said.  He added that if oil extraction continues, there is imminent danger that deforestation will soar.

Abandoned oil barrels in Ecuador. Image courtesy of Amazon Watch.

“This report comes at a very urgent time,” Kevin Koenig, Climate and Energy Director at Amazon Watch told Mongabay in an interview. Ecuador’s new right-wing President Guillermo Lasso, a former banker and businessman who took office in May 2021, plans to double the country’s oil production during his term.

The Ecuadorian ministry of the environment and water responded to Mongabay’s request with a written statement, sharing that it is “committed to the conservation of the Amazon.”

“Therefore, we are promoting extractive activities to compensate for loss of biodiversity,” relayed a representative. The ministry plans on using revenue generated from extractive industries to fund conservation projects and achieve net-zero loss in flora and fauna in the areas where these activities take place.

While the ministry did not comment on the report as requested, it highlighted that its “overall mission is to guarantee the quality, conservation and sustainability of natural resources within a wider national approach.” Representatives of the ministry did not share any plans to move away from fossil fuels.

‘A climate role model’

The report finds that California receives almost a quarter of its total demand from the Amazon, where the extraction of hydrocarbons has been linked to thousands of oil spills over the last decades, affecting the environment and surrounding Indigenous people and local communities (IPLCs). At the United Nations climate summit this year, COP 26, the American the state labeled itself “a working model for how to aggressively fight the climate crisis while bolstering the clean economy.”

Oil pipeline infrastructure in the Ecuadorian Amazon. Image courtesy of Amazon Watch.

Responding to a request by Mongabay, the California Environmental Protection Agency referred to its commitment to reduce demand for fossil fuels by 2035 and stop oil extraction by 2045.

“The report makes clear that California’s transition away from fossil fuels is in fact a global moral imperative,” a spokesperson said by email.

According to the report, which tracked US EIA data on foreign crude oil imports to U.S. refineries from their country of origin, the majority of Amazonian oil goes to California based corporations, including LAX airport, PepsiCo, Amazon.com and Chevron. In 2020, PepsiCo consumed an estimated 16.6 million liters (4.4 million gallons) of diesel from the Amazon rainforest for their California operations.

Chevron and its subsidiary, Texaco, made headlines in the last several years due to its responsibility for devastating spills during operations in Ecuador, today dubbed the “Amazon’s Chernobyl.” More than 73 billion liters (16 billion gallons) of toxic waste was discharged and some 1,000 toxic waste pits abandoned, with evidence of high pollution levels in soils and water in the Ecuadorian Amazon.

In the 1990s, the corporation was sued by Indigenous territories in the region and a fine of $9.5 billion (originally $18 billion) was rendered by an Ecuadorian judge in 2011. Chevron has not paid the fine as the company continues to reject the verdict.

In a tour carried out with residents of the Sani Isla community, it was found that there is still a lot of crude oil along the banks of the Napo river. Image courtesy of Ivan Castaneira/Agencia Tegantai.

Although pollution and deforestation have been related to oil extraction throughout the world, Ecuador plays a key role in the Amazon’s oil industry. Compared to Colombia and Peru where large parts of the oil fields are outside of forested areas, and Brazil which produces from its off-shore fields, Ecuador is the only oil exporter in the region whose entire oil reserves are located within the Amazonian rainforests.

The South American nation is also home to one of the most biodiverse areas on the planet, the Yasuní National Park. It is home to thousands of plant and wildlife species such as the golden-mantled tamarin (Leontocebus tripartitus), the giant armadillo (Priodontes maximus) and the jaguar (Panthera onca) which are under threat of extinction. Located on top of vast oil reserves, it has been the target of the ongoing oil infrastructure expansion, which environmentalist regard with concern.

“Our preliminary modelling found a strong correlation between oil production on a block and its rate of deforestation,” said Robertson. “If this trend holds for Yasuní, the deforestation pressure will be immense.”

The petroleum industry is a significant part of Ecuador’s economy. Oil extraction is one of the country’s main sources of revenue for foreign debt repayments. It accounts for approximately a third of all government earnings and almost half of its exports. According to a report by the World Bank, as of 2020 Ecuador’s foreign debt stands at $58.5 billion, or more than half the size of its economy. The Ecuadorian president announced plans to double the country’s oil production in order to meet foreign debt repayments.

Repair work on the damaged pipeline that caused the oil spill in April 2020. This section of repairs was at the height of the pass known as “El Reventador” on the Quito – Lago Agrio road. Image courtesy of Ivan Castaneira/Agencia Tegantai.

“Lasso’s plans are a big deal because an uptake in production is going to come from a key block in Yasuní,” said Koenig.

At present, a large part of the most productive oil block is called ITT, named after its oil fields Ishipingo-Tiputini-Tambococha. There is a total of 112 wells which are located within the boundaries of the park. According to Koenig, the Ecuadorian government plans to build more than 600 wells which would impact the Waorani people whose territory is found in the region. The Indigenous group includes some of the last uncontacted tribes on earth, the Tagaeri and Taromenane.

A crossroad in the Amazon

However, pressure from Indigenous communities and organizations to curb destructive extractive industries is mounting. In September, the IUCN World Conservation Congress approved of Motion 129, a motion submitted by Indigenous advocacy groups to protect of 80 percent of the Amazon rainforest by 2025 to avoid the “point of no return.” A global advocacy campaign promoting the plan, called “Amazonia for Life”, led by the Coordinator of Indigenous Organizations of the Amazon River Basin (COICA), was launched at the same time.

In October, Indigenous and environmental groups in Ecuador legally challenged two executive decrees signed by President Lasso which set down the expansion of the oil industry while compromising on the rights of IPLCs.

The applicants referred to the ILO Convention 169, the United Nations and American Declaration on rights of the Indigenous Peoples and the country’s Constitution of 2008. They declared that the President’s decisions “promote the ethnocide and extermination of the Indigenous peoples of Ecuador.”

“Our basic right to Free, Prior and Informed Consent (FPIC) continues to be violated by oil drilling projects, as is our right to a healthy environment Indigenous autonomy, and the rights of nature,” Marlon Vargas, President of the Confederation of Indigenous Nationalities of the Ecuadorian Amazon (CONFENIAE), says in the report.

Indigenous family in the Ecuadorian Amazon.
Indigenous family in the Ecuadorian Amazon. Image courtesy of Amazon Watch/Caroline Bennett.

In its response to Mongabay, Ecuador’s Ministry of the Environment said that it has been working with Indigenous Community Organizations, including CONFENIAE.

The Ministry states that it is “in the process of adapting secondary legislation on environmental regulation and environmental processes of citizen participation processes on free, prior and informed consultation.” This is to “effectively comply with the provisions of the Constitution and the requirements of the peoples and nationalities of the Yasuní National Park, the ITT and the entire national territory.”

However, in the midst of contention over oil extraction projects, Ecuador is also facing a major infrastructure crisis. Last week, the government declared force majeure on all oil production contracts. This was due to severe regressive erosion causing landslides which environmentalists have linked to a hydropower dam in the areas of the country’s two main oil pipelines.

It is the third time since April 2020 that a landslide-caused pipeline ruptured. This resulted in the biggest oil spill in the last 15 years, affecting hundreds of kilometers of water along the Coca and Napo rivers. The leak was one of 899 counted between 2015 and 2021, most of which have not been adequately cleaned up.

The Napo River runs through the Ecuadorian Amazon. In April 2020, the largest oil spill in 15 years occurred on the river, affecting thousands of Indigenous peoples. Image courtesy of Amazon Watch.

The crumbling infrastructure could impact the Ecuadorian president’s decision to auction 7 million acres (2.8 million hectares) of oil exploration licenses next year.

“Ecuador is at a crossroads,” said Koenig, who added that opening up new areas for new exploration is “totally incompatible with the Paris Agreement. It’s madness from a climate perspective.”

Environmentalists hope that advocacy from IPLC organizations, combined with problems surrounding crumbling infrastructure and growing international agreement to follow to climate goals, could increase pressure on the Ecuadorian government.

“These hurdles will hopefully slow things down long enough for Motion 129 and the Amazonia for Life Campaign to gain traction before the blocks are auctioned,” said Stand.Earth’s Robertson.

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Victoria Shineman is an Assistant Professor in the Political Science Department at the University of Pittsburgh. She earned her BA from Reed College, her Ph.D. from New York University, and was a Postdoctoral Research Associate at Princeton University. Her primary research interests intersect political behavior, electoral institutions, and experimental methods. Her current research focuses on electoral policies which affect the costs and incentives to participate, ranging from systems that encourage voting (like compulsory voting) to those that discourage or disenfranchise (like felon disenfranchisement and other forms of voter suppression). Shineman studies the primary effect of these systems on voter turnout, as well as the second-order (downstream) effects of electoral systems on mass behavior - including political information, trust, efficacy, and polarization. Shineman is a BITSS Catalyst with the Berkeley Initiative for Transparency in the Social Sciences, and a member of Evidence in Governance and Politics (EGAP). She teaches courses in public opinion, voting behavior, and experimental research, and supervises research among undergraduate and Ph.D. students. She also teaches units on research ethics, transparency, and reproducibility.

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