For Immediate Release
June 11, 2003

Contact:
Jon Sohn, (202) 783-7400 x 231, jsohn@foe.org

Hostage Crisis in Peru Exposes Fundamentally Flawed Camisea Project
Environmental Group Renews Call for Cancellation of Public Loans

Friends of the Earth today renewed its call for the Inter-American Development Bank and US Export-Import Bank to not provide public financing for the Camisea fossil fuel project in Peru, citing the recent hostage crisis as one more example why US taxpayer money should not support this fundamentally flawed project.

The group cited the Camisea gas project in Peru as a glaring example of how increasing the US dependence on fossil fuels - as laid out in the Bush-Cheney Energy Plan - is undermining our energy independence and security. Just this week, armed gunmen described as terrorists took over 60 Camisea pipeline workers hostage.

"The Camisea hostage takings should serve as a wake up call for the Bush administration that US taxpayer dollars should not be used to finance this risky and environmentally destructive project," said Friends of the Earth campaigner, Jon Sohn. "The Bush-Cheney Energy Plan advocates increasing our dependence on fossil fuels from developing countries despite widespread recognition that the key to energy security is to invest in safer and cleaner renewable sources of energy."

A group of kidnappers took over 60 employees hostage this week in a mountainous jungle area southeast of Lima at a Camisea project construction site. Reports indicate the hostages were later freed by the Peruvian military in a surprise attack.

The increased violence around Camisea throws the project into a new level of uncertainty. MSNBC today reported the potential involvement of the Shining Path, described as a rebel group that has waged ongoing fights with Peruvian state security forces. Defense Minister Aurelio Loret de Mola called the kidnapers "armed criminals" while the local police described them as "presumed terrorists."

The kidnapping episode at the Camisea gas terminal compounds ongoing controversies surrounding the project.

The Camisea Project is a $1.5 billion oil and gas drilling project that will extract gas from the Nahua-Kugapakori Reserve for the protection of nomadic indigenous peoples who have had no little or no contact with the outside world. It will cut through one of the world's most pristine tropical rainforests and home to the Nahua, Kirineri, Nanti, Machiguenga and Yine indigenous groups. Gas is slated to be exported to Baja and then transmitted to California.

As reported by the Washington Post, the two major US companies involved in the project are Hunt Oil Co. and Halliburton Co., which have longstanding ties to the Bush-Cheney administration and the Republican Party. The project is seeking public financing from the US Export Import Bank, the Inter-American Development Bank, as well as export credit agencies in five other countries. Critics point to Citigroup's recent withdrawal as financial advisor for the Camisea project as further indication that the project is financially, environmentally and socially risky. In addition, the US Overseas Private Investment Corporation made a public statement yesterday that they turned down financing applications for Camisea.

There are already reports that the project has caused massive tropical forest erosion and river pollution, has used divisive community relations tactics, and may be the cause of least eight child fatalities among isolated indigenous groups, who lack immunity to common respiratory and gastrointestinal diseases.

An analysis of Chapter 8 of the Bush-Cheney Energy Plan and more information on Camisea is available from Friends of the Earth upon request.

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