Dr Robert Goodland, a tropical ecologist, was asked by an association of international NGOs in August 2002 to carry out an independent assessment of the OCP consortium project. As a long-time employer of the World Bank and a developer of environmental standards, Dr Goodland is regarded an independent and qualified specialist.

His survey of the OCP pipeline documents what has been fiercely criticized by the environmentalists from the very beginning of the project.
The OCP project infers substantial violations of all four relevant social and environmental standards of the World Bank:

1. Principle of environmental sustainability

1. Principle of environmental sustainability

This section of the World Bank environmental and social standards is to ensure that the planned projects are implemented in an environmentally and socially sustainable manner and comply with the principle of sustainable development.
To this end, an environmental analysis is carried out in advance to examine and evaluate regional impacts of the project on people and nature. An independent expert team of environmental and social scientists advises the project management in the development of the analysis research design.
Local population is to be informed in detail before and during the project and to be involved in the decision-making.
Dr Goodland discovered the following situation in the event of OCP.

Regional impacts

With the pipeline construction, OCP plans to double the oil extraction in the Amazonas region because of a cost-effective exploitation of the new transport ways.
Oil companies that own extraction concessions in the Orient have to expand their extraction capacities as they are contractually bound to meet defined minimum amounts.
The concession holders should invest approximately $ 2.5 to 4.5 billion in the expansion of the extraction facilities. Neither the OCP nor the SOTE pipelines will be fully exploited until the extraction technology has been expanded.
This future oil production expansion will have significant impacts on local ethnic minorities and tropical rain forests. The negative impacts of the SOTE pipeline, which has been operating for more than 30 years, will be thus supported.
The OCP consortium has missed the chance to analyse the more intensive impacts on the indigenous population and the rain forest in an independent environmental impact assessment analysis.

Consultancy of environmental and social scientists

Independent, internationally respected experts should formulate recommendations concerning all the important aspects of the project for the project management. A team of advisors has to be summoned prior to the beginning of the environmental analysis. First, the experts deal with the form of the EIA. This should ensure that the environmental analysis takes all important issues into consideration and that the choice of the route is based on qualified and reliable results.
After the beginning of the construction stage the advisor commission monitors the observance of the conditions at regular intervals. During the operation, the team executes an inspection once a year.
A team of technicians fails to comply with this World Bank requirement.

In the event of OCP, a procedure in accordance with this World Bank principle cannot be identified. The planned consultancy of an expert group at the end of the construction stage does not meet the World Bank standards.

Independency of the environmental analysis

The American company Entrix carried out an environmental impact analysis commissioned by OCP. Subsequent research has shown that the Texas-based company from Houston is economically closely connected with OCP.
Miguel Aleman, the managing director of Entrix Ecuador, has represented OCP's interests on several occasions and can be indicated as an OCP employer according to his business card. The independency of the research conducted is thus questioned on an international scale.

Systematic examination of options

The environmental and social standards require regarding all conceivable options before taking a final decision. The reasons for the elimination of various options from the decision-making process are as follows: It should be ensured that the alternative with the smallest negative impacts is selected. This concerns the option with the smallest social and environmental expenses, yet not with the smallest economic expenses.

In the event of the OCP pipeline, the possibilities of a capacity expansion of the existing pipelines should be also taken into consideration. Possible ways of reducing environmental damage include stronger pumps, a larger pipeline diameter, a smaller failure rate due to an automatic leakage recognition and alternative transport means.
By a careful choice of the pipeline route, expenses can be saved and environmental damage prevented.
A dense distribution along the SOTE route, which was constructed 30 years ago, would comply with this procedure. Two options were to be taken into account for the bypass of the capital of Quito:
The Northern route, leading through several protected natural areas and seismically very active regions, and the shorter Southern route, leading mostly through agricultural areas. According to publicly accessible materials, the Northern route was chosen already in 1999, long before the range and content description of the environmental analysis was available. In the same year, first preparations for the controversial Northern route started. The reasons for preferring the longer and more expensive route with heavier environmental burdens were not obvious from the available materials.
This procedure breeches to a great extent the directives stipulated by the World Bank. OCP undermines thus the important role of the environmental analysis.

Informing local population

Public consultations of local population and NGOs are indispensable.
The public should be informed of the range and content description of the EIA before the project starts.
OCP did not comply with the proper procedure. In May 2001, relevant information has been made accessible to local population for about two or three weeks. OCP introduced the project and the EIA in three sessions. Because of strong demonstrations, at least the last session had to be abandoned.

Generally, one-sided information campaigns are wrong in such events. Local population has the right to express its opinions before an important decision is made and must not be presented with ready solutions. OCP refused a dialogue with local population on several occasions. The consortium ignored letters from environmental organisations such as "Comite Pro Ruta Menor Impacto".

OCP failed to organize detailed information sessions with local population and to encourage a productive dialogue between the consortium and the people. The World Bank directives were not observed at this point either.

2.Principle of protection of natural habitats

This directive bans supporting projects that can lead to a significant loss or devastation of critical natural habitats.
In other natural habitats (non-critical habitats) such projects may be implemented only on condition that there are no realistic options and the incurred damage can be compensated by special measures.
(Source: Information journey of Ute Koczy and Bernhard von Grünberg, deputies of the Landestag of Nordrhein-Westfalen, 2002; p. 6) Stipulation, analysis and range of impacts on natural habitats Map material of relevant protected natural areas and habitats of endangered species is a basis for a sustainable decision-making. To this end, OCP consulted the Mindo working group. Experts in birds, mammals, botany, eco-tourism, environmental analyses and geology examined in a short period of nine days the planned Northern route. The results of the examination of species richness and biodiversity of the Northern route underline the drawbacks of the environmental impact analysis of OCP. Since the species richness of the Southern route is much smaller according to the estimates of experts, the choice of the Northern route was questioned again. Still, the results have not been taken into account in the EIA accordingly.

According to the World Bank standards, the Mindo-Nambillo national park belongs because of its worldwide unique species richness to critical natural habitats. The principle of the protection of natural habitats prohibits the transformation or damage of these regions.

Besides many protected forests, aquatic habitats are endangered by the project.
For the construction of the new marine terminal near Esmeraldas at the Pacific Ocean, OCP acquired about 400 hectares land without having analysed the consequences for the coastline or the impacts on the subaquatic fauna.

3.Unvoluntary resettlement

This term refers to the resettlement or the loss of housing, loss of property or the access to it as well as the loss of the source of income. Should a project affect more than 200 people according to this definition, a resettlement action plan (RAP) has to be developed prior to filing the application for the project. As compensation, an adequate material aid or indemnification must be provided. The population in question is to be informed in time and participate in the decision-making.
(Source: see above)
In the event of OCP no resettlement plan is available. For rural population, the World Bank standards stipulate a land-for-land compensation. However, OCP offered only cash to the farmers and left them no choice.
For the expropriation in the region of the marine and Amazonas terminal the necessary resettlement plans were not worked out either.

4.Principle of protection of indigenous nations

Ethnic minorities and their habitats should be protected. Besides, indigenous population should profit from the project.
Since OCP strives to double the extraction of oil, negative impacts on the ethnic minorities in the regions of extraction are to be expected. This concerns particularly the Achuar, Shuar, Huaorani, Quichua, Shiwari, Zaparo and possibly other groups that live without any contact to the outer world and have not been informed yet.
An appropriate development plan for the indigenous nations should be therefore worked out.

The impacts of the increasing oil volume and the effects on the indigenous population are not mentioned in the EIA of OCP. Thus the World Bank regulations are violated.
The mistake of OCP is to be found in the preparation of the project when it failed to call an expert team to consult the environmental analysis.
The failure to examine the negative effects on local population in the environmental analysis can have devastating consequences for the indigenous nations. Expropriation of land and a ban on the traditional farming in the respective regions are just the first consequences.
Pollution of air, water and soil due to oil ponds and ruthlessly disposed residual chemicals lead in the medium term to malnutrition of the population. Useful areas and natural resources such as fish, fruits and medicinal herbs will decline.

30 years of the production of the SOTE pipeline is a clear example of this development. In addition to a violation of the World Bank standards, there was a "complete disregard... of the observance of rules according to the international human rights conventions".
(Source: Independent Compliance Assessment of OCP with the World Bank's Social and Environmental Policies; 2002; in Martinez-Alier et al. 2001; p. 22)

What consequences will the results of the independent assessment have on the continuation of the project?
How will the credit provider, the WestLB and the German Bundesland Nordrhein-Westfalen as the major shareholder of the bank, react to the environmental report?

To the interview

The full Goodland Report