Ecuador grapples with results of oil and mining referendums

Legal battles over two referendums in Ecuador are on the horizon.

The referendums were part of the first round elections on August 20 and voters decided to stop oil extraction at block 43, known as Ishpingo-Tambococha-Tiputini (ITT), and metal mining in the Andean Chocó area, north of Quito.

But energy minister Fernando Santos told BNamericas that communities near block 43 must authorize the closure first and that production will continue until the last day of the Guillermo Lasso administration.

A runoff is scheduled for October 15 and the new government term starts November 30.

“According to the constitution, the communities of Orellana province, where the block is located, have to decide whether to start or end exploitation of natural resources; they are the ones who have to say yes or no to the closure. Therefore, we are facing a constitutional problem and the country must be aware of that,” Santos said.

He added that the constitutional court, which authorized the referendum, must issue a ruling.

When approving the ITT referendum, the court mandated that the block’s infrastructure should be dismantled within one year, but Santos said works are complex and cost around US$500mn.

Around 60% of voters favored shutting down the block, although Orellana province voted to maintain it.

Santos said production of around 57,000b/d will continue, but an expansion is not viable. "The authorities, together with the technicians, will carry out a plan for the possible dismantling of the infrastructure and closure of the wells so that the next government can implement it. Meanwhile, normal production will continue." 

CHOCÓ

Mining in the biodiverse Chocó area is still in early stages, but Quito residents voted to shut it down.

Promoters of the referendum, like lawyer Fred Larreátegui, told reporters that no project would reach the production stage. Larreátegui said 12 concessions were granted and eight are being processed.

Larreátegui added that the results were clear and that anti-mining groups will go to the courts to ensure the results are respected.

Santos, meanwhile, said the constitution guarantees legal certainty and that a consultation cannot be applied retroactively. “The signed contracts have the right to advance to the production stage. No new contracts will be issued, but those signed will continue.”