The best of EcoWatch, right in your inbox. Sign up for our email newsletter!
Amazon Reef: BP Drilling Plans Dealt Another Blow by Brazilian Regulator
By Joe Sandler Clarke, Unearthed
BP's plans to drill for oil near a huge coral reef in the mouth of Amazon river have been dealt a further blow after a regulator questioned the company's environmental risk assessment.
Ibama, Brazil's federal environmental agency, rejected an environmental study from the British oil giant, further delaying the company's plans to drill in the region.
In a technical note [in Portuguese], the agency criticized the study for a lack of detail on oil spill modeling and the impact drilling could have on local wildlife, and said it required more information before allowing the company to proceed with plans to drill in the region.
The news comes just a few weeks after Unearthed revealed that the British oil giant discussed concerns over environmental licensing in Brazil with a UK government minister.
Department of International Trade (DIT) minister Greg Hands then personally lobbied Brazil's deputy mines and energy minister Paulo Pedrosa on the issue.
When asked to comment on that story, a spokesperson for DIT said, "it is absolutely not true that our ministers lobbied to loosen environmental restrictions in Brazil—the meeting was about improving the environmental licensing process, ensuring a level playing field for both domestic and foreign companies, and in particular helping to speed up the licensing process and make it more transparent, which in turn will protect environmental standards."
Geologists believe there could be as much as 14 billion barrels of oil in the region, known as the Foz do Amazonas basin.
But a massive coral reef has thrown plans to drill in the area into doubt.
Scientists had long suspected there might be a reef in the region, but its size and depth was not confirmed until five years ago, just as the Brazilian government was putting out drilling licenses to tender.
BP, along with French company Total and Brazil's Petrobras, snapped up five exploration blocks in the mouth of the Amazon in 2013.
In order to drill for oil in the region, companies have to submit environmental impact assessments (EIA) to Ibama.
Ibama said the methodology in BP's EIA for the FZA-M-59 block was "very limited" and the regulator needed more information about what the impact of a oil spill might be in the region. BP holds a 70 percent stake in the block, with the remaining 30 percent owned by Petrobras.
Contacted by Unearthed, BP said that "requests for clarifications" from the regulator may occur several times before a permit is issued.
"As part of the licensing process for drilling a well on the FZA-M-59 block, BP has received the first technical opinion requesting clarifications to the environmental impact study that was presented.
"Under Brazilian legislation and the licensing process managed by IBAMA, requests for clarifications related to the environmental study typically can and do occur several times before the issuance of an environmental permit."
30 percent chance of a spill hitting the reef
Previous assessments filed by the oil majors have caused controversy.
Earlier this year, Unearthed reported that documents filed by Total and BP to Ibama showed that there was a 30 percent chance that a prospective spill from the company's shared blocks could reach the reef.
At the time, a BP spokesperson told us, "Operations on the blocks will only proceed when fully permitted by the Brazilian regulators."
Just a few weeks later, Unearthed found a document showing that BP intended to use a chemical known as Corexit in the event of an oil spill in the region.
The chemical dispersant was used extensively during the Deepwater Horizon disaster in 2010 and three years later, scientists found that the chemical had a negative impact on coral larvae in the Gulf of Mexico.
BP still intends to drill in the region in 2018.
British government lobbying
The news comes as BP finds itself embroiled in a political controversy in Brazil.
We previously reported that a diplomatic telegram from the British government, obtained by Unearthed, showed that, at a "private breakfast" in Rio de Janeiro, BP—together with Shell and Premier Oil—relayed their concerns "around taxation and environmental licensing" to Greg Hands, who then raised them "directly" with Brazilian official Pedrosa.
Now a group of politicians in Brazil are asking prosecutors to investigate whether there may have been any breach of Brazilian law in the award of offshore oil blocks to international companies, including BP.
Reposted with permission from our media associate Unearthed.
EcoWatch Daily Newsletter
By Randi Spivak
Slashing two national monuments in Utah may have received the most attention, but Trump's Interior Department and U.S. Forest Service have been quietly, systematically ceding control of America's public lands to fossil fuel, mining, timber and livestock interests since the day he took office.
A new report by Greenpeace International pinpointed the world's worst sources of sulfur dioxide pollution, an irritant gas that harms human health. India has seized the top spot from Russia and China, contributing nearly 15 percent of global sulfur dioxide emissions.
By Sue Branford and Thais Borges
Ola Elvestrun, Norway's environment minister, announced Thursday that it is freezing its contributions to the Amazon Fund, and will no longer be transferring €300 million ($33.2 million) to Brazil. In a press release, the Norwegian embassy in Brazil stated:
Given the present circumstances, Norway does not have either the legal or the technical basis for making its annual contribution to the Amazon Fund.
Brazilian President Jair Bolsonaro reacted with sarcasm to Norway's decision, which had been widely expected. After an official event, he commented: "Isn't Norway the country that kills whales at the North Pole? Doesn't it also produce oil? It has no basis for telling us what to do. It should give the money to Angela Merkel [the German Chancellor] to reforest Germany."
According to its website, the Amazon Fund is a "REDD+ mechanism created to raise donations for non-reimbursable investments in efforts to prevent, monitor and combat deforestation, as well as to promote the preservation and sustainable use in the Brazilian Amazon." The bulk of funding comes from Norway and Germany.
The annual transfer of funds from developed world donors to the Amazon Fund depends on a report from the Fund's technical committee. This committee meets after the National Institute of Space Research, which gathers official Amazon deforestation data, publishes its annual report with the definitive figures for deforestation in the previous year.
But this year the Amazon Fund's technical committee, along with its steering committee, COFA, were abolished by the Bolsonaro government on 11 April as part of a sweeping move to dissolve some 600 bodies, most of which had NGO involvement. The Bolsonaro government views NGO work in Brazil as a conspiracy to undermine Brazil's sovereignty.
The Brazilian government then demanded far-reaching changes in the way the fund is managed, as documented in a previous article. As a result, the Amazon Fund's technical committee has been unable to meet; Norway says it therefore cannot continue making donations without a favorable report from the committee.
Archer Daniels Midland soy silos in Mato Grosso along the BR-163 highway, where Amazon rainforest has largely been replaced by soy destined for the EU, UK, China and other international markets.
An Uncertain Future
The Amazon Fund was announced during the 2007 United Nations Climate Change Conference in Bali, during a period when environmentalists were alarmed at the rocketing rate of deforestation in the Brazilian Amazon. It was created as a way of encouraging Brazil to continue bringing down the rate of forest conversion to pastures and croplands.
Government agencies, such as IBAMA, Brazil's environmental agency, and NGOs shared Amazon Fund donations. IBAMA used the money primarily to enforce deforestation laws, while the NGOs oversaw projects to support sustainable communities and livelihoods in the Amazon.
There has been some controversy as to whether the Fund has actually achieved its goals: in the three years before the deal, the rate of deforestation fell dramatically but, after money from the Fund started pouring into the Amazon, the rate remained fairly stationary until 2014, when it began to rise once again. But, in general, the international donors have been pleased with the Fund's performance, and until the Bolsonaro government came to office, the program was expected to continue indefinitely.
Norway has been the main donor (94 percent) to the Amazon Fund, followed by Germany (5 percent), and Brazil's state-owned oil company, Petrobrás (1 percent). Over the past 11 years, the Norwegians have made, by far, the biggest contribution: R$3.2 billion ($855 million) out of the total of R$3.4 billion ($903 million).
Up till now the Fund has approved 103 projects, with the dispersal of R$1.8 billion ($478 million). These projects will not be affected by Norway's funding freeze because the donors have already provided the funding and the Brazilian Development Bank is contractually obliged to disburse the money until the end of the projects. But there are another 54 projects, currently being analyzed, whose future is far less secure.
One of the projects left stranded by the dissolution of the Fund's committees is Projeto Frutificar, which should be a three-year project, with a budget of R$29 million ($7.3 million), for the production of açai and cacao by 1,000 small-scale farmers in the states of Amapá and Pará. The project was drawn up by the Brazilian NGO IPAM (Institute of Environmental research in Amazonia).
Paulo Moutinho, an IPAM researcher, told Globo newspaper: "Our program was ready to go when the [Brazilian] government asked for changes in the Fund. It's now stuck in the BNDES. Without funding from Norway, we don't know what will happen to it."
Norway is not the only European nation to be reconsidering the way it funds environmental projects in Brazil. Germany has many environmental projects in the Latin American country, apart from its small contribution to the Amazon Fund, and is deeply concerned about the way the rate of deforestation has been soaring this year.
The German environment ministry told Mongabay that its minister, Svenja Schulze, had decided to put financial support for forest and biodiversity projects in Brazil on hold, with €35 million ($39 million) for various projects now frozen.
The ministry explained why: "The Brazilian government's policy in the Amazon raises doubts whether a consistent reduction in deforestation rates is still being pursued. Only when clarity is restored, can project collaboration be continued."
Bauxite mines in Paragominas, Brazil. The Bolsonaro administration is urging new laws that would allow large-scale mining within Brazil's indigenous reserves.
Hydro / Halvor Molland / Flickr
Alternative Amazon Funding
Although there will certainly be disruption in the short-term as a result of the paralysis in the Amazon Fund, the governors of Brazil's Amazon states, which rely on international funding for their environmental projects, are already scrambling to create alternative channels.
In a press release issued yesterday Helder Barbalho, the governor of Pará, the state with the highest number of projects financed by the Fund, said that he will do all he can to maintain and increase his state partnership with Norway.
Barbalho had announced earlier that his state would be receiving €12.5 million ($11.1 million) to run deforestation monitoring centers in five regions of Pará. Barbalho said: "The state governments' monitoring systems are recording a high level of deforestation in Pará, as in the other Amazon states. The money will be made available to those who want to help [the Pará government reduce deforestation] without this being seen as international intervention."
Amazonas state has funding partnerships with Germany and is negotiating deals with France. "I am talking with countries, mainly European, that are interested in investing in projects in the Amazon," said Amazonas governor Wilson Miranda Lima. "It is important to look at Amazônia, not only from the point of view of conservation, but also — and this is even more important — from the point of view of its citizens. It's impossible to preserve Amazônia if its inhabitants are poor."
Signing of the EU-Mercusor Latin American trading agreement earlier this year. The pact still needs to be ratified.
Council of Hemispheric Affairs
Looming International Difficulties
The Bolsonaro government's perceived reluctance to take effective measures to curb deforestation may in the longer-term lead to a far more serious problem than the paralysis of the Amazon Fund.
In June, the European Union and Mercosur, the South American trade bloc, reached an agreement to create the largest trading bloc in the world. If all goes ahead as planned, the pact would account for a quarter of the world's economy, involving 780 million people, and remove import tariffs on 90 percent of the goods traded between the two blocs. The Brazilian government has predicted that the deal will lead to an increase of almost $100 billion in Brazilian exports, particularly agricultural products, by 2035.
But the huge surge this year in Amazon deforestation is leading some European countries to think twice about ratifying the deal. In an interview with Mongabay, the German environment ministry made it very clear that Germany is very worried about events in the Amazon: "We are deeply concerned given the pace of destruction in Brazil … The Amazon Forest is vital for the atmospheric circulation and considered as one of the tipping points of the climate system."
The ministry stated that, for the trade deal to go ahead, Brazil must carry out its commitment under the Paris Climate agreement to reduce its greenhouse gas emissions by 43 percent below the 2005 level by 2030. The German environment ministry said: If the trade deal is to go ahead, "It is necessary that Brazil is effectively implementing its climate change objectives adopted under the [Paris] Agreement. It is precisely this commitment that is expressly confirmed in the text of the EU-Mercosur Free Trade Agreement."
Blairo Maggi, Brazil agriculture minister under the Temer administration, and a major shareholder in Amaggi, the largest Brazilian-owned commodities trading company, has said very little in public since Bolsonaro came to power; he's been "in a voluntary retreat," as he puts it. But Maggi is so concerned about the damage Bolsonaro's off the cuff remarks and policies are doing to international relationships he decided to speak out earlier this week.
Former Brazil Agriculture Minister Blairo Maggi, who has broken a self-imposed silence to criticize the Bolsonaro government, saying that its rhetoric and policies could threaten Brazil's international commodities trade.
Senado Federal / Visualhunt / CC BY
Maggi, a ruralista who strongly supports agribusiness, told the newspaper, Valor Econômico, that, even if the European Union doesn't get to the point of tearing up a deal that has taken 20 years to negotiate, there could be long delays. "These environmental confusions could create a situation in which the EU says that Brazil isn't sticking to the rules." Maggi speculated. "France doesn't want the deal and perhaps it is taking advantage of the situation to tear it up. Or the deal could take much longer to ratify — three, five years."
Such a delay could have severe repercussions for Brazil's struggling economy which relies heavily on its commodities trade with the EU. Analysists say that Bolsonaro's fears over such an outcome could be one reason for his recently announced October meeting with Chinese President Xi Jinping, another key trading partner.
Maggi is worried about another, even more alarming, potential consequence of Bolsonaro's failure to stem illegal deforestation — Brazil could be hit by a boycott by its foreign customers. "I don't buy this idea that the world needs Brazil … We are only a player and, worse still, replaceable." Maggi warns, "As an exporter, I'm telling you: things are getting very difficult. Brazil has been saying for years that it is possible to produce and preserve, but with this [Bolsonaro administration] rhetoric, we are going back to square one … We could find markets closed to us."
- Brazil's New President Could Spell Catastrophe for the Amazon ... ›
- Amazon Deforestation Increase Prompts Germany to Cut $39.5M in ... ›
Hawaii's Kilauea volcano could be gearing up for an eruption after a pond of water was discovered inside its summit crater for the first time in recorded history, according to the AP.
Gina Lopez, a former Philippine environment secretary, philanthropist and eco-warrior, died on Aug. 19 from brain cancer. She was 65.
Thousands of union members at a multibillion dollar petrochemical plant outside of Pittsburgh were given a choice last week: Stand and wait for a speech by Donald Trump or take the day off without pay.
By Simon Mui
States across the country are stepping up to make clean cars cheaper and easier to find. Colorado's Air Quality Control Commission (AQCC) voted Friday to adopt a Zero Emission Vehicle (ZEV) program that will increase the availability of electric vehicles in the state, improve air quality and increase transportation affordability.