Peru: Maple Energy-01/Nuevo Sucre and Canaan
Community members of Nuevo Sucre and Canaán, Loreto, Peru
Impacts to community health and the environment
Up to $10 million equity
In July 2007, the IFC approved a Category B project with Maple Energy, a privately-held integrated energy company with operations in Peru. The project will finance the company’s capital expenditure program in the short-to-medium term, which includes drilling and well work-over programs and related activities to extend production of existing hydrocarbon fields; exploration and related activities in hydrocarbon concessions; and development of a greenfield ethanol project.
In April 2010, a complaint was filed with the CAO from local community members of Nuevo Sucre and Canaán in Loreto, Peru with the assistance of national and international NGOs. The two Indigenous communities are located on the Ucayali River in the lower Ucayali region of Loreto, in proximity to the company’s two mature crude oil producing properties. The complaint cites several social and environmental concerns, among them negative impacts to the communities’ health and to the environment.
In April 2010, the CAO accepted the complaint. An Ombudsman team conducted an assessment of the issues through a series of conversations and visits with the stakeholders to discuss options for the parties to resolve their concerns. In June 2010, the parties expressed interest in pursuing a collaborative process facilitated by the CAO. By February 2011, the parties had determined conditions under which they would meet, and designed ground rules that would govern their engagement.
Between April and August 2011, the company and community representatives met four times in a CAO-facilitated dialogue process that resulted in three signed agreements and the implementation of several agreed action points. The dialogue was designed to address community access to safe drinking water, improving communication between the parties, development of environmental and health studies, and options for community monitoring. (Not all action points were completed as the communities chose to withdraw from the process in August 2011.)
On July 10, 2011, one month before the fourth dialogue table was convened, an oil spill of approximately two barrels occurred close to the community of Nuevo Sucre, according to the company’s reporting to the Government of Peru. The company engaged several members of Nuevo Sucre to participate in the clean-up efforts. At the next dialogue meeting in August 2011, it became clear that the parties had divergent views on the amount of oil spilled, the effectiveness of the company’s response to the spill, whether community members had been exposed to health risks, and what the company’s next steps should be. Further, the parties reached an impasse regarding the financing of the environmental and health studies. These two areas of disagreement proved insurmountable, and the communities decided to withdraw from the dialogue process. In accordance with the CAO's Operational Guidelines, the case was transferred to CAO Compliance for appraisal. Signed agreements from the dialogue table are available in the documents section below, along with the CAO's Ombudsman Conclusion Report.
CAO completed the compliance appraisal in May 2012. The Appraisal finds that during IFC’s due diligence process, IFC identified and assessed all the major concerns that relate to the direct impacts of the project that were later raised by the complainants. Throughout the various project investment phases, IFC worked with Maple to improve its information disclosure, community participation, and environmental and social protections. CAO’s review of IFC's project documentation indicates that IFC committed resources to ensure that periodic site visits were conducted and Maple’s environmental performance was reviewed. With each site visit and performance review, IFC documented Maple’s implemented actions and repeatedly flagged pending actions for Maple to undertake. The IFC project documentation reviewed by the CAO indicates that IFC identified and acted upon what it considered a concern regarding the pace at which Maple implemented recommended actions. Since IFC identified and acted upon this concern, it does not constitute a failure on IFC’s part to assure itself of the performance of its client.
CAO finds that an audit of IFC’s due diligence and monitoring of the investments related to Maple against the applicable policy provisions would yield limited information and be of limited value beyond what this appraisal has identified. The CAO concluded that this case does not merit an audit of IFC and closed the case with no further action in May 2012. CAO's appraisal report is available in English and Spanish at the link below.