Guatemalans take Texas oil company to court

This tropical forest is Guatemala's largest of its kind, a lush home to monkeys, crocodiles, and jaguars.

It is also home to a prodigious petroleum operation funded by a Texas multinational.

In a country where the law expressly forbids resource extraction in national parks, the foreign presence has pitted environmentalists against the financial hopes of a struggling third world country. People across the globe are anxiously observing the legal imbroglio here, aware that the victor - corporate or environmental - will be an example for similar cases worldwide.

Carlos Conde of the Guatemala City environmental organization Madre Selva asks: "If the government isn't going to prevent resource extraction in the Laguna del Tigre National Park where there is a fragile ecosystem protected by national law and international conventions, where is it going to prevent it?"

Basic Resources International, a subsidiary of the Houston- based Anadarko Petroleum Corp., has concessions to work on two lots within the park's borders. The company won the contract for the first lot in 1985, and its wells produce most of the country's 25,000 barrels of heavy crude extracted daily. The company won the rights to explore for oil on the second lot in 1992.

The second contract, which occupies more than half the park and is known as 1-92, is the source of the present debate. Environmentalists maintain that the contract is illegal because it was signed in 1992, two years after the area was declared both a national park and the core area of the Maya Biosphere Reserve.

Madre Selva filed a case in the constitutional court and a complaint with the state prosecutor for the environment, challenging the legality of contract 1-92. In a decision at the end of October, that court ruled that it was not the proper venue to hear the case. After a year, the state prosecutor for the environment has yet to make a decision in the case. Madre Selva, has decided to take the case to an international court and file suit in the United States.

Meanwhile, the nongovernmental Guatemala City Institute for Environmental Law and Sustainable Development (IDEADS) is taking another route, trying to get a new ruling on the company's environmental impact study. The study was approved by the agriculture ministry, but according to IDEADS, the ministry doesn't have that legal jurisdiction.

Despite these actions, Basic Resource can still explore within the 1-92 contract lands.

And IDEADS director Alejandra Sobenes says this "decision to not take actions against the company" is politically motivated. "There are clear illegalities in this case. First the energy and mines ministry puts national park lands up for auction as a petroleum lot. Then it signed an exploration contract," she fumes. "And on top of it all, an inappropriate government body approves the environmental impact study."

But according to company representatives, the contract is not the problem. The park is.

Basic's president, Rodolfo Sosa, says the 1990 creation of the Laguna del Tigre National Park was a poorly planned initiative taken without prior study. He says planners ignored the existence of an ongoing petroleum operation. "If there's petroleum on one side of the area, there's petroleum on the other," he says.

According to him, their operation is legal because the Constitution states that the government has an obligation to extract non-renewable resources for the economic benefit of the country. Mr. Sosa says that since the Constitution is the highest law of the land, it outranks laws like the ones governing national parks.

The company's two contracts cover nearly 500,000 acres, but "we are working on no more than 200 acres of land in the park," Sosa underlines. "That brought the government $60 million last year alone."

Nearly 95 percent of the petroleum produced in the country comes from wells in the company's first contract within the park. According to the Ministry of Energy and Mines, petroleum is the fourth-most important source of foreign-currency income, behind coffee, sugar and bananas.

The six-year exploration contract in question ends in February 2001. If the company finds hydrocarbon reserves by then, the contract will be automatically converted into a 25-year production contract on a reduced extension of land. If they find nothing, the lot will be returned to the state. So far, Basic's two exploratory wells have come up dry.

But, Madre Selva's Magaly Rey Rosa worries about the signal sent by the government to Guatemalans: "that laws can be broken and nothing will happen."

(c) Copyright 2000. The Christian Science Publishing Society