European Banks Urged to Stop Investing in Amazon Oil Trade

European banks have been urged to stop supporting oil development in the headwaters of the Amazon.

The call comes from indigenous people who say that the industry poses a threat to them and destroys the delicate ecosystem in the area.

The expansion of oil drilling threatens the 74m acre area that spans across Ecuador and Peru and houses 500,000 indigenous people – some of whom live in voluntary isolation.

Many banks have already promised to move their funding away from fossil fuel projects, especially in fragile ecosystems. However, a new report by Stand.earth Research Group and Amazon Watch has exposed £7.6bn worth of funds still going into the industry since 2009.

The funds are making their way into fossil fuels due to a ‘grey area’. Instead of looking at ‘project finance’, which revolves around the financing used to start projects and extract oil, the report looks at ‘trade finance’, which revolves around the process of moving the gas and oil to refineries.

Banks have been making loans, often through intermediaries, to companies requesting trade finance. These loans fall outside the scope of the banks’ sustainability targets.

President of the Confederation of Indigenous Nationalities of the Ecuadorian Amazon, Marlon Vargas, said: “I wonder if the executives of banks in Europe know the real cost of their financing. How can they possibly sleep peacefully knowing their money leaves thousands of indigenous peoples and communities without water, without food and in devastating health conditions due to the pollution of the Coca and Napo rivers? It is time for the banks, companies and consumers of the oil extracted in the Ecuadorian Amazon to acknowledge how their businesses affect our territories and way of life.”

Around 17m gallons of crude oil has been spilled during previous oil exploration in the region. Hundreds of miles of rivers were contaminated by an oil spill in Ecuador back in April, affecting 35,000 people. There have also been several oil spills in Peru.

Forest programmes director at Stand.earth, Tyson Miller, said: “The Amazon sacred headwaters region is a cultural and ecological gem. It is considered to be the most biodiverse terrestrial ecosystem on the planet, maintaining the hydrological cycle for all of the Americas, and helping to regulate Earth’s climate.

“New and ongoing oil extraction in the region is a gateway to deforestation and increased agricultural and industrial activity, which is why indigenous leaders in the region have repeatedly voiced their opposition to the expansion of the oil industry, and other industrial activities in their territories.”