Abstract

The Regional Association of Oil and Natural Gas Companies in Latin America and the Caribbean (ARPEL) gathers both state-owned and private oil and gas companies, representing more than 90% of the upstream and downstream production.

In the late 80's, and considering the projections of oil and gas exploration and production development projects in frontier areas dwelled by indigenous peoples, ARPEL member companies became aware of the potential future concerns that this issue would represent to their operations. These concerns were accentuated by the fact that Latin America has the richest biodiversity of the world, counting with 46% of the world tropical forests, 40% of tropical animal and vegetal species and 31% of freshwater reserves.

Furthermore, the rapid increase of environmental regulations and legislation, and the increasing international attraction on environmental and social-cultural issues in sensitive areas have made the management of these issues critical to the companies' success. Failing to identify and mitigate these risks has had significant implications, including projects' delays, excessive costs and - eventually - abandonment.

In 1999, ARPEL was invited to join the tripartite (indigenous peoples, government and oil industry) regional dialogues being fostered by the World Bank and OLADE - Latin American Energy Organization.

At present, the three parties are developing a project, lead by COICA-Confederation of Indigenous Organizations of the Amazonian Basin - OLADE - on behalf of governments - and ARPEL. The three parties are developing commonly agreed guidelines and mechanisms that allow for planning and designing a regionally homogeneous regulatory framework to develop oil and gas projects in line with sustainable development concepts.

This paper describes the experience gathered by ARPEL since 1987 with particular emphasis on the tripartite dialogues and the guidelines being presently developed to set the basis for the future regulatory framework of oil and gas industry relations with indigenous peoples in Latin America.

Background During the 90's, oil and gas exploration and exploitation activities geared their operations towards more sensitive areas from the environmental, cultural and social points of view. Likewise, organizations of indigenous peoples who had originally inhabited this basin have been able to voice their claims more clearly for territorial rights, respect for their identity, preservation of their culture and the improvement of their social and economic conditions.

The increasing speed of oil and gas exploration and its spread towards more remote and sensitive areas of the world, has constituted a challenge to the operating companies to properly identify, understand and manage risks that are not technic

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