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Financing Amazon oil

BlackRock, Goldman Sachs, Citigroup, HSBC and JP Morgan Chase defy climate commitments by backing oil and gas extraction in the Amazon
Katie Hill - Editor-in-Chief, My Green Pod
Discharge pond at a petroleum production station in the Ecuadorian Amazon

A report released by Amazon Watch shows how five American and British financial institutions are actively accelerating climate change and human rights abuses by providing billions of dollars in debt and equity financing for crude oil extraction projects in the western Amazon.

Already, millions of acres of the western Amazon have been auctioned for oil extraction, with tens of millions more slated by the Peruvian, Ecuadorian and Colombian governments.

‘It’s pretty hard to imagine a more evil twofer than wrecking the rainforest to get some oil so you can wreck the climate–it’s an object lesson in greed and stupidity, and in why we need to put a serious crimp in the money pipeline!’

Environmental journalist and professor, Middlebury College

Indigenous resistance

The report, Investing in Amazon Crude, also provides four extensive case studies of waves of dissent, protest and legal resistance by indigenous communities in the region that have led to numerous suspensions of already existing and planned projects, including three in the Peruvian Amazon alone in January 2020.

The report authors demonstrate how this resistance will escalate as new leases are sold and crude oil projects are developed, threatening the long-term viability of projects and investments in them.

‘As indigenous Sapara of the Amazon, we place great value on the natural world around us. We protect the biodiversity of this land, and value its water, plants, animals, rivers, waterfalls and mountains. We have been fighting for over 10 years to ensure that oil extraction companies do not enter our territory, as they pose a grave threat to our social, environmental and cultural wellbeing.

‘We urge the world to promote alternative forms of renewable energy that do not depend on the exploitation of precious natural resources, and to prioritise solutions to the climate crisis that protect the world’s most vulnerable areas.’

President of the Sapara Nation of Ecuador

The firms financing extraction

The five firms have provided tens of billions of dollars to oil companies operating in the Amazon in the last three years, including to the foreign-owned firms GeoPark, Amerisur, Frontera and Andes Petroleum.

The report’s findings include detailed data on BlackRock’s flouting of its own celebrated climate commitments through continued investment in GeoPark, Frontera and Andes, reaching into the billions of dollars.

It also shows hundreds of millions of dollars in debt financing of ongoing regional expansion of crude oil operations from Citigroup.

‘While recent announcements from Wall Street giants show that the financial sector is waking up to the gravity of the climate crisis, firms like BlackRock, JP Morgan Chase, and Goldman Sachs must step up their game. Oil and gas extraction of all kinds are destroying our climate, especially in sensitive ecosystems like the Amazon. Banks and asset managers must back up their commitments with action by rapidly ramping up climate-risk standards across sustainable funds as well as their entire portfolios.’

Climate and finance director at Amazon Watch and lead author of the report

HSBC’s total contribution to Amazon crude oil extraction is revealed to be over $1.2 billion, through securities holdings and debt/equity financing.

Nearly a billion dollars in debt financing for regional expansion of crude oil operations has come from Goldman Sachs.

Hundreds of million dollars in investments in oil companies and debt financing of crude oil operations in the region is through JP Morgan Chase.

Climate change and the Amazon

There has been mounting pressure on the financial industry, as policymaker and activist attention has turned to its role in funding both large-scale deforestation in the Amazon and a climate crisis that is in danger of running away.

Amazon destruction and climate change are intimately connected, as the rainforest absorbs an enormous amount of global greenhouse gases, drives weather patterns and regulates global temperatures.

Continued degradation of the landscape risks feedback loops that lead to ecological collapse in the Amazon and the acceleration of climate crisis.

The western Amazon is home to nearly a half of the Amazon’s indigenous peoples, groups who have seen decades of oil and mineral extraction devastate their communities.

Keep it in the ground

Amazon Watch has been a pioneer in holding financial institutions accountable for deforestation and climate pressures in the Amazon.

It was part of the coalition of groups that succeeded in pushing financial giant BlackRock to make recent climate commitments, and it is a founding member of Stop the Money Pipeline, a national coalition calling for an end to the financing of climate destruction, which is gearing up for a large day of action next month.

‘Enough is enough. For decades we have made it clear that we don’t want drilling and mining in our territories. Now western science shows that it is not just fossil fuel emissions that lead to climate change, but also the forest destruction that comes with extraction.

‘With less than a decade to avoid the worst of this crisis, we need to draw a line and agree that in order to save our planet, the oil must stay in the ground.’

President, Confederation of Indigenous Nationalities of the Ecuadorian Amazon (CONFENIAE)

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