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February 20, 2002
Verdict Still Out on Costa Rica Offshore Drilling
    by Anne Moore Odell

Although American companies Harken Energy and MKL-Xplorations purchased the rights to drill for oil off the coast of Costa Rica in 1998, drilling has not started as local organizations voice concerns.

In 1997, the Costa Rican government, interested in developing domestic oil reserves, began accepting bids for drilling rights from foreign oil companies. The privately owned MKJ-Xplorations received a contract in April 1998 to an area equaling 5634 kilometers (1.4 million acres) in a region called Talamanca, which is on Costa Rica's Caribbean coast. MKJ then sold 80 percent of its rights to publicly traded Harken Energy (Amex: HEC). President George W. Bush was once a board member and major shareholder in the Houston-based oil company.

Talamanca is a diverse ecosystem of tropical forests, mangrove swamps, and coral reefs. These varied environments house many endangered animals, including the green sea turtle. The Natural Resources Defense Council (NRDC) has stated that "Talamanca's seven protected areas, including a UNESCO World Heritage Site, contain more concentrated biodiversity than almost any other place on earth." A significant amount Costa Rica's tourism dollars has come from travel to such pristine and varied environments.

Costa Rican government concessions allow companies six years to explore and twenty years to extract gas and oil. In November 1999, the companies began exploring the area off the Moin bay, near the city of Limon, using seismic reflection to map possible oil reserves. Locals who rely on fishing complained that the explosions from the seismic reflections drove lobsters and shrimp away, disrupting the region's fishing industry.

More than fifty Costa Rican groups have since come together to oppose the offshore oil exploration and drilling. These groups include local governments, environmentalists, biologists, the eco-tourism sector, and organizations representing indigenous peoples such as the BriBri and Cabecar. A coalition named Accion de Lucha Antipetrolera (ADELA), comprised of almost 30 local citizens' organizations, has been formed to stop oil drilling in the region. ADELA filed a lawsuit arguing that Costa Rica's federal government had violated the local populations' rights by not allowing them to participate in the decision process regarding oil drilling.

Costa Ricans concerned for Talamanca's future reminded the executive branch of the federal government that Costa Rica signed the Rio Declaration of 1992, the Climate Change Convention of 1993, and the Kyoto Protocol of 1997. These documents challenge governments to develop clean energy and find replacements for fossil fuels.

In part as a result of the ADELA lawsuit, in September 2000 Costa Rica's Supreme Constitutional Court overturned the concessions granted to companies in 1997 and blocked oil exploration on indigenous reserves. However, under pressure from government agencies and the oil companies, the court later reinstated the permits and allowed exploration to go forth near the port cities of Limon and Moin.

In July 2001, Harken Energy decided to reduce its ownership in the Costa Rica venture to 40 percent. Harken reported in a press release that this action would allow the company to rechannel four million dollars previously earmarked for the Costa Rica project into domestically focused projects. Harken Energy could not be reached for comment.

According to Emily Yozell, a lawyer working for ADELA, Costa Rica's Ministry of the Environment has stated that it does not have the resources to monitor offshore oil developments. Furthermore, recent oil developments run in opposition to the "development model [the Ministry of the Environment's] office has been promoting within the communities associated with the protected areas," said Yozell.

The right to drill is still tied up in the courts, and much hinges on the outcome of the recent presidential election in Costa Rica that resulted in a run-off scheduled for April 7. As Harken Energy and other oil companies look for new oil reserves around Costa Rica to meet worldwide demand, concerned local citizens join with other world citizens to question what impact new drilling would have on the environment and local culture.


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