95 Groups From 24 Countries Call On OPIC To Cancel Funding For Indonesia Oil And Gas Projects

(2 April, 2003 — Honolulu)  Environmental Defense and a coalition of more than 90 other NGOs from two-dozen countries today called on the Overseas Private Investment Corporation (OPIC) to cancel $350 million in financing to expand Unocal Corporation’s West Seno offshore oil and gas projects in East Kalimantan, Indonesia.  The project involves the development of 40 new offshore wells and two proposed 60-kilometer pipelines under sea and over land.

“There are strong indications of serious environmental and human rights abuses associated with this project,” said Environmental Defense scientist, Dr. Stephanie Gorson Fried. “Already the expansion of Unocal offshore activities in East Kalimantan led to an August, 2002 deep water oil spill in which no notification was given to the public until weeks after the event, prompting accusations of a cover-up in the Indonesian press.”

In addition, Indonesian non-governmental groups have written to OPIC several times over the past year-and-a-half raising serious human rights problems with the project and calling for full participation by local residents in order to ensure environmental concerns are being addressed. 
 
“This project appears to be in violation of Indonesia’s environmental law requiring full citizen input into the structure and production of an environmental impact assessment prior to the commencement of new activities. The law also requires citizen participation in the development of the environmental management plan and the environmental monitoring plan,” said Dr. Fried.   

In a letter to Peter Watson of OPIC sent March 21, 2003, the non-governmental groups questioned whether the organization had met its own “due diligence” requirements to assess the environmental and human rights impacts of its loans (OPIC letter available upon request).

“We believe that a credible due diligence process, covering environmental and human rights aspects - including the apparent need for significant environmental remediation for existing Unocal operations - would yield a decision to reject project clearance for the West Seno projects.  We urge OPIC to cancel plans to support UNOCAL’s East Kalimantan operation,” the groups stated