02Oct07

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The current status of the negotiation between Repsol YPF and the Assembly of the Guaraní People Itika Guasu.

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The Assembly of the Guaraní People (APG)
Organisation of the Guaraní Communities of Bolivia
A.P.G. Región Itika Guasu

THE CURRENT STATUS OF THE NEGOTIATION BETWEEN REPSOL YPF AND THE APG ITIKA GUASU.

Background

In February 2006 the Guaraní people of Itika Guasu formally submitted an Independent Indigenous Monitoring Report entitled "Environmental, Social and Cultural Impacts of REPSOL YPF S.A. in the indigenous territories of Bolivia". A copy was also delivered to the President of the Republic Evo Morales Ayma, the Vice-President Álvaro García Linera, the Deputy Minister for the Environment Juan Carlos Iporre and the Minister for Hydrocarbons Andrés Solís Rada.

A further copy of the report was sent to Antonio Brufau, President of Repsol YPF S.A. headquartered in Madrid, Spain. The reason for sending this copy to Spain was the silence of the response by REPSOL YPF S.A. in Bolivia, to various Social and Environmental Monitoring reports carried out by APG IG between 2004 and 2005.

The said report had also been submitted in May 2006 in Vienna to the Permanent Forum on Indigenous Issues in Vienna as evidence of the bad practices being used by the multinational corporation REPSOL YPF S.A. in its activities in Bolivia. In the same month, representatives of the APG Itika Guasu took the opportunity to visit Madrid and met with José María Pérez Garrido, Director for Corporate Reputation and Social Action at Repsol YPF S.A. and, José María García Perrote, Director of Corporate Reputation at Repsol YPF S.A., and had various meeting with members of the Spanish Government including: Señor D. Jorge Blázquez Lidoy - Advisor, Economic Office of the President; Señor D. Agustín Mainar - Directorate General for Trade and Investment- Ministry for Industry,Tourism and Commerce (National Contact Point in Spain), Señor D. Juan Carlos Sánchez Alonso - Sub-Directorate General, Countries of The Andean Community - Foreign Affairs Ministry; and Señor D. Fernando Fernández-Arias - Director Office of Human Rights (Foreign Affairs Ministry). They also held meetings with representatives of Spanish Parliament such as The Right Honourable Gustavo Arístegui (PP) - Congress of Deputies, The Right Honourable Manuel Mas i Estela, as well as with civil society organisations including Amnesty International.

By way of clarification it should be said that in all the meetings held both with the Spanish Government members and with the representatives of REPSOL YPF S.A., the relationship between REPSOL YPF S.A. Spain and its activities in Bolivia through its principal Bolivian subsidiary Repsol YPF Bolivia |*| was never denied. In fact it could be said that the presence of the Guaranís in Madrid encouraged a rapprochement between REPSOL YPF Bolivia and the APG Itika Guasu.

In June 2006, the representative of REPSOL YPF Bolivia came to the territory of Itika Guasu where he heard direct from the Guaraní people themselves the ways in which they had been adversely affected by the presence of the Spanish/Argentinian petrol company in their lands. A resolution was signed there in which the APGIG declared itself willing to build a harmonious relationship and the Guaraní people evidenced their good faith and will to set out the bases for a relationship of mutual respect and began to establish the requirements under which REPSOL YPF S.A. would make a significant contribution to the implementation of the Guaraní Development Plan which had been submitted to the company in the month of September.

As a result of this first meeting, REPSOL YPF S.A. made a first offer to contribute to the PDG (the Guaraní Development Plan) the amount of 12 million dollars, but the offer contained their first trick - the amount had to be apportioned over a period of 20 years.

Despite the fact that it was envisaged that the PDG would be implemented in a period of 5 years and at a cost of 20 million dollars, the APGIG in a demonstration of good will agreed in principle to the terms and requested that the company consider improving the amount of this first offer.

At the second meeting two weeks later, the APGIG made some progress and as a result of its insistence the company offered 13.5 million dollars over 20 years, with over 50% of it to be paid in the first 5 years.

The third meeting was held in the second fortnight of December after the parties had submitted their proposals for a draft agreement and the company had taken the opportunity to show its true intentions by conditioning the execution of any agreement on the APGIG renouncing its rights and on it being a passive observer during the execution of the PDG.

In addition, in what served to cool relations even further, the company did not allow the third meeting to continue but instead requested a recess, again conditioning the resumption of dialogue on agreement to certain concrete proposals including the renouncing by the APGIG of its indigenous rights.

It should be noted that during this time, REPSOL YPF Bolivia did not deny being a subsidiary of Repsol YPF S.A. nor did it condition its agreement to contribute to the PDG on the consent of its other partners in the consortium to exploit Campo Margarita.

The recess lasted 6 months

Six months passed before the company and APG IG resumed a dialogue and once again it insisted that it must be a condition to any agreement that the APGIG renounce those rights which, as an indigenous people, it has under national and international law.

APGIG took this time as an opportunity to reconstruct its proposals for an agreement to ensure that its terms and conditions were more suited to deal with its relationship with a multinational corporation such as REPSOL YPF S.A.

However, notwithstanding the efforts made by the APGIG, the response from REPSOL YPF Bolivia was yet again a negative one, dismissing the Guaranís' endeavours to put together a proposal which accommodated international law and confirming that any agreement would depend on an express waiver of indigenous rights.

As part of a constant effort to make progress, the APGIG asked REPSOL YPF Bolivia to set out the reasons for its disagreement with the draft contract submitted by APGIG and to ensure there was no misunderstanding, it asked that these comments be put in writing and that they include a point by point analysis. To date REPSOL YPF Bolivia has not done this and has limited itself to proffering orally a few inappropriate remarks.

From bad to worse

While the Guaraní people believed that the dialogue with the company had made some progress, yet again this illusion vanished when faced with the silence from the company, which refused to give a written response to the draft agreement offered by the APG IG. Given what has happened, we now know that this has been no more than a strategy to avoid giving the APGIG a clear and transparent response and is therefore a less than ethical approach by the company.

The company, instead of offering a reply has now proposed a new draft |**|, using many of the ideas contained in the Guaraní draft, but subtly manipulated to suit the Company's objectives. We say this because it is now even more clear that the intentions of REPSOL YPF S.A. are anything but the establishment of a frank, sincere and ethical dialogue with the Guaraní people of Itika Guasu.

The new draft from REPSOL YPF, which was submitted on 31^st August 2007, is if anything even worse than the first, although it has the "virtue" of making the company's intentions clearer.

In the opinion of the APGIG there is no doubt that REPSOL YPF S.A. is trying to tie the hands of the Guaraní people of Itika Guasu for a period of 20 years in return for drip-feeding funds to them which will not even be administered by the APGIG as, pursuant to the terms of REPSOL YPF's draft, only the company will have the right to administer the funds, thereby violating the right of the Guaraní people to their own autonomy.

The proposal made to the APGIG by the Spanish/Argentinian multinational supports the reason behind the complaint made by the APGIG in February 2006 to the Bolivian Government and in May 2006 to the Permanent Forum on Indigenous Peoples and to the Spanish Government: this multinational company in Bolivia does not put into practice its own policies of Corporate Responsibility, much less the international human rights standards.

In addition, they are trying to isolate the responsibility of REPSOL YPF S.A., the parent company in Madrid, from its subsidiary REPSOL YPF BOLIVIA, as it is now being said that the Bolivian company is autonomous of its Spanish parent. Nevertheless, given what has been proposed by them, this autonomy is one of convenience: for the purposes of their SEC Annual Report and official publications, Repsol Bolivia is a subsidiary company but for the purposes of dealing with the APGIG it is autonomous. In other words, REPSOL YPF S.A. is abandoning its responsibilities to the APGIG.

The current challenges

REPSOL YPF S.A. has forced the Guaraní people of Itika Guasu into a situation which can only be called an abuse of law. We say this because the multinational has offered to "support" the PDG in exchange for the Guaraní people forgetting what has gone on in the past and surrendering any attempt to see justice done. REPSOL YPF is also proposing that the Guaraní people forget what happens in the future for, whilst insisting that the 13.5 million dollars are not considered compensation by REPSOL YPF S.A., the funds should be considered as compensation by the APGIG for future damages.

It is for this reason that APGIG considers that REPSOL YPF in its new proposal denies four legal aspects which are fundamental for the APGIG

1. The autonomy of the APG, that is to day, that the Guaraní Development Plan can only be implemented and administered by the Guaraní people themselves, without the intervention of Repsol YPF.

2. Ownership of the so-called "TCO" (" Original Community Territories"): Repsol YPF disputes our ancestral rights to Guaraní territories, and it is a fundamental condition that Repsol YPF acknowledges unconditionally our ownership and title to the lands of Itika Guasu.

3. The requirement of a parent company guarantee, any agreement must be between APG ltika Guasu and Repsol YPF S.A. (Spain).

4. Finally, we must have financial guarantees because this agreement is a long term agreement.

Thus, in the spirit of the defence of human rights we will not be accomplices to the neo-colonial attitude apparent in the proposal of REPSOL YPF, for today the solidarity of the Guaraní people of Itika Guasu is more necessary than ever.

We call on national and international public opinion to join in solidarity with the five thousand Guaraní people who are currently the object of undue pressure on the part of the Spanish company REPSOL YPF, perhaps supported by the complicit silence of Governments such as ours, and by the passivity of thousands upon thousands of Spaniards who continue to believe that REPSOL YPF S.A. can properly be described as " socially responsible" in Bolivia.

BY THE ASSEMBLY OF THE GUARANI PEOPLE OF ITIKA GUASU

Never Barrientos
President APG IG

Florentino Zeballos
Vice President APG IG

Benildo Vaca
Resp. RR-NN

Plácido Rojas
Resp. Communications

Celestino Cacharí
Resp. TT

Zacarías Cuéllar
Resp. Infraestructure

Gregorio Barrientos
Resp. Education

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Notes:

(*) References in the text to "Repsol YPF Bolivia", include all the subsidiaries of Repsol YPF S.A. in Bolivia. [Back]

(**) In this proposal, Repsol YPF S.A. seeks to limit its financial and legal risk to 37.5 %, which is the percentage of its participation in the Contract of Operation for the Caipipendi Area, Campo Margarita, through its indirect ownership of Repsol YPF E&P Bolivia S.A. [Back]

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For futher information:

Never Barrientos
President of APG Itika Guasu
Telephone: +591.4613.3347
Mobile: +591.7294.7079

Economic, Social and Cultural Rights

This document has been published on 02Oct07 by the Equipo Nizkor and Derechos Human Rights. In accordance with Title 17 U.S.C. Section 107, this material is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes.