British Petroleum Finds Oil - Plus a War
Colombian rebels frequently target pipelines and rigs
CUSIANA, COLOMBIA — Standing upon an estimated 2 billion barrels of oil, the two young Colombian Army conscripts nervously adjust the semiautomatic rifles slung over their shoulders. Towering in the distance, like giant Olympian torches, the gas flares of the Cusiana oil field burn on, as some of the daily production of 185,000 barrels of crude is processed through the maze of steel pipes strewn across the landscape.
For British Petroleum (BP), exploitation of what is believed to be the largest oil discovery in the Western Hemisphere since the 1960s may be straightforward. But maintaining security on one of the front lines of Colombia's 35-year-old civil war without becoming embroiled in the conflict is proving to be a challenge.
Beyond the oil field lie partially forested Andean foothills, home to hundreds of National Liberation Army (ELN) rebels. They have stepped up attacks on the installations, which are co-owned by BP and state-run oil company Ecopetrol (Empresa Colombiana de Petroleos).
On top of the safety issue, BP finds itself fighting to preserve its international reputation. In December, British newspapers reported allegations, stemming from a Colombian government report, that BP was "fueling Colombia's killing machine," as one London paper described it. A European Parliamentary Commission on human rights accused BP of "complicity" in human rights abuses by security forces.
BP officials deny the allegations - that it passed videotapes and photos of its opponents to Colombian armed forces, which then used them in killing campaigns against suspected ELN members.
Some analysts say the story may be an extortion attempt by the ELN against BP. Both of Colombia's rebel groups - the ELN and the Revolutionary Armed Forces of Colombia - have often financed their war by kidnapping foreign businesspeople and by other terrorist tactics.
With its 19 percent stake in the Cusiana field - which produces one-third of Colombia's crude-oil output - BP is the nation's largest foreign investor. That makes the British company the No. 1 target for extortion and kidnapping by rebels.
"We rely on the Colombian government, the Army, and the police to protect us," says Phil Mead, associate president of BP in the oil-rich Casanare region. BP says 500 to 600 of the 3,000 troops stationed in Casanare are assigned to protect its drilling rigs, wells, and central processing facility.
AFTER Algeria, Colombia is regarded as the most dangerous country for oil companies and their employees.
Partly in return for the protection they receive, oil companies operating in Colombia by law must pay a "war tax" of $1.25 a barrel, which the Defense Ministry may spend as it chooses. Two American oil firms, Total Petroleum and Triton Group, also have a share of Cusiana's output.
Ecopetrol has long been a prime target for rebel groups. Kidnapping engineers, bombing pipelines, and direct attacks on installations are common events. Since the 1960s, rebels have bombed Colombia's main oil pipeline 342 times, spilling an estimated 1.2 million barrels of crude.
"In the last six months ... one rig alone has been attacked four times. [And] we've had helicopters shot down," Mr. Mead says. No lives were lost.
According to reports by Amnesty International and America's Watch, Colombia's security forces have the worst human rights record in the Americas.
BP has made some effort to improve the situation. But "we can't manage the military per se," says Mead. Colombian President Ernesto Samper Pizano has attempted to clean up his country's human rights record, sending military commanders and paramilitary leaders to prison and launching nationwide publicity campaigns.
Residents in the local capital of El Yopal welcome the oil project, since it brings with it water, roads, state service, and several thousand troops. Before the 1991 find, El Yopal was a typical regional capital with no roads or infrastructure to speak of. Neglect by the state led to the town becoming an ELN stronghold - as security forces rarely ventured into these hot, flat plains.
Mead worries that security issues could affect BP's future expansion plans. He says the company has made a legal agreement to pay the Defense Ministry $8 million over three years for "nonlethal aid." He says, "We are affected by the violence as much as other people here in Colombia."