Moratorium on Oil Exploration Harken Energy, Costa Rica

After more than a decade of legal struggles coupled with the mobilization of the local population and the civil society, the sentence from late 2014 left Harken Energy with no compensation for the annulment of its oil concessions along Costa Rica coasts.


<div class="horipane"><div class="title active">Description</div><div class="content"><table class="table"><tbody><tr><td class="fld"></td><td class="columns"> In 2000, Harken Costa Rica Holdings LLC, subsidiary of the U.S. Harken Energy, received a <b>20-year concession </b>to look for and <b>exploit offshore oil resources</b> in the province of Limn, 188 kilometers northeast of San José. Local fishermen, environmentalists and indigenous groups opposed the future potential Harken’s activities since they would <a>endanger the coral reefs and mangrove swamps</a>.  In <b>2002, a moratorium on oil exploration</b> came into effect, halting drilling activities in Costa Rica, after sustained pressure from civil society.<b> On September 16th 2003</b>, the Texan multinational <b>Harken Energy filed </b><a><b>a claim </b>with the International Centre for Settlement of Investment Disputes</a> (ICSID), an institution of the World Bank Group based in Washington, D.C., for US$57 million compensation from the Government of Costa Rica, for loss of potential earnings. <b>The claim is opposed by social movements and environmentalists</b>, who dispute the legitimacy of the claim. <a>The complaint was <b>also opposed by the Minister of Environment</b></a><b> </b>because the North-American oil company did not even try first to resolve the dispute through local and national judicial instances.  Harken Energy later withdrew its claim to the ICSID and desired to reach an out-of-court agreement, which failed because of Costa Rican<b> government firm opposition</b> to compensate the oil company. So in October 2005, Harken brought the case to the Costa Rican jurisdictions asking for the <b>annulment of the Resolution 019-2005-P-MINAE</b> which invalidates the oil concessions previously granted to the oil company. Harken Energy also demanded the payment of compensations for the prejudices suffered. In <b>December 2014</b>, <a>the Contentious Administrative Court settled in favor of the Costa Rican Government</a>. The Central America Free Trade Agreement (CAFTA) signed on May 24th, 2004, between the US and five Central American countries, of which Costa Rica, <a>weakens future possibilities for environmental regulations</a>. <b>CAFTA investors’ protection</b> allows multinationals to directly appeal to international arbitration without having primarily to pass through national jurisdictions. Still international arbitrations are renowned for easily leaning in favor of multinationals’ interests. In case of new disagreements with multinational operating on its territory, the Costa Rican government is<b> no more</b> able to require for<b> first sorting out the dispute through the national jurisdictions</b> as it was the case in the dispute with Harken Energy. </td></tr></tbody></table></div></div><div class="horipane"><div class="title active">Basic Data</div><div class="content"><table class="table"><tbody><tr><td class="fld">Name</td><td>Moratorium on Oil Exploration Harken Energy, Costa Rica</td></tr><tr><td class="fld">Country</td><td><a href="/country/costa-rica">Costa Rica</a></td></tr><tr><td class="fld">Province</td><td>San Jose</td></tr><tr><td class="fld">Site</td><td>Talamanca area</td></tr><tr><td class="fld">Accuracy of Location</td><td>MEDIUM regional level</td></tr></tbody></table></div></div><div class="horipane"><div class="title active">Source of Conflict</div><div class="content"><table class="table"><tbody><tr><td class="fld">Type of Conflict (1st level)</td><td>Fossil Fuels and Climate Justice/Energy</td></tr><tr><td class="fld">Type of Conflict (2nd level)</td><td>Oil and gas exploration and extraction</td></tr><tr><td class="fld">Specific Commodities</td><td><a href='/commodity/crude-oil'>Crude oil</a></td></tr></tbody></table></div></div><div class="horipane"><div class="title active">Project Details and Actors</div><div class="content"><table class="table"><tbody><tr><td class="fld">Type of Population</td><td>Unknown</td></tr><tr><td class="fld">Start Date</td><td>12/1999</td></tr><tr><td class="fld">Company Names or State Enterprises</td><td><a href='/company/harken-energy'>Harken Costa Rica Holdings LLC <small>(HCRH)</small></a> from <a href='/country-of-company/united-states-of-america'><small>United States of America </small></a><br /><a href='/company/harken-energy'>Harken Energy</a> from <a href='/country-of-company/united-states-of-america'><small>United States of America </small></a><br /><a href='/company/mkj-xploration'>MKJ Xploration </a> from <a href='/country-of-company/united-states-of-america'><small>United States of America </small></a> - <small>sold its Costa Rican interests to Harken Energy</small></td></tr><tr><td class="fld">Relevant government actors</td><td>Environment Ministry's Technical Secretariat (SETENA) - Costa Rica, Municipality of Talamanca - Costa Rica, Contentious Administrative Court - Costa Rica</td></tr><tr><td class="fld">International and Financial Institutions</td><td><a href='/institution/world-bank'>The World Bank <small>(WB)</small></a><br /><a href='/institution/fondo-monetario-internacional'>International Monetary Fund <small>(FMI)</small></a><br /><a href='/institution/international-centre-for-settlement-of-investment-disputes'>International Centre for Settlement of Investment Disputes <small>(ICSID)</small></a> from <a href='/country-of-institution/united-states-of-america'><small>United States of America </small></a> - <small>Harken's claim against the Costa Rican government, later withdrawn</small><br /><a href='/institution/unesco'>UNESCO - United Nations Educational, Scientific and Cultural Organization <small>(UNESCO)</small></a></td></tr><tr><td class="fld">Environmental justice organisations and other supporters</td><td>Action for Anti-Oil Struggles (Acción de Lucha Antipetrolera : ADELA) - Costa Rica, OIlwatch Costa Rica, Asociación de Ecología Social Costarricense (AESO)</td></tr></tbody></table></div></div><div class="horipane"><div class="title active">The Conflict and the Mobilization</div><div class="content"><table class="table"><tbody><tr><td class="fld">Intensity of Conflict (at highest level)</td><td>LOW (some local organising)</td></tr><tr><td class="fld">When did the mobilization begin</td><td>PREVENTIVE resistance (precautionary phase)</td></tr><tr><td class="fld">Groups Mobilizing</td><td>Fishermen<br /> Indigenous groups or traditional communities<br /> Local ejos<br /> Local government/political parties<br /> Social movements</td></tr><tr><td class="fld">Forms of Mobilization</td><td>Creation of alternative reports/knowledge<br /> Development of alternative proposals<br /> Public campaigns</td></tr></tbody></table></div></div><div class="horipane"><div class="title active">Impacts</div><div class="content"><table class="table"><tbody><tr><td class="fld">Environmental Impacts</td><td><strong>Potential: </strong>Air pollution, Biodiversity loss (wildlife, agro-diversity), Fires, Global warming, Soil contamination, Oil spills, Deforestation and loss of vegetation cover, Surface water pollution / Decreasing water (physico-chemical, biological) quality, Groundwater pollution or depletion</td></tr><tr><td class="fld">Other</td><td>potential impacts on mangroves and coral reefs</td></tr><tr><td class="fld">Socio-economic Impacts</td><td><strong>Potential: </strong>Loss of traditional knowledge/practices/cultures, Militarization and increased police presence, Land dispossession, Lack of work security, labour absenteeism, firings, unemployment, Loss of livelihood</td></tr></tbody></table></div></div><div class="horipane"><div class="title active">Outcome</div><div class="content"><table class="table"><tbody><tr><td class="fld">Project Status</td><td>Stopped</td></tr><tr><td class="fld">Pathways for conflict outcome / response</td><td>Institutional changes<br /> New legislation<br /> Strengthening of participation</td></tr><tr><td class="fld">Development of Alternatives</td><td>The Town Hall of Talamanca declares itself a territory free from oil exploration. </td></tr><tr><td class="fld">Do you consider this as a success?</td><td>Yes</td></tr><tr><td class="fld">Why? Explain briefly.</td><td>A moratorium on oil exploration came into effect, halting drilling activities in Costa Rica, after sustained pressure from civil society. And the multinational company received no compensation for it.</td></tr></tbody></table></div></div><div class="horipane"><div class="title active">Sources and Materials</div><div class="content"><table class="table"><tbody><tr><td class="fld">Legislations</td><td><table><tr><td><p> International Labour Organisation (ILO) Indigenous and Tribal People Convention #169<br/></p></td></tr><tr><td><p> 1994 hydrocarbons law, designed to comply with World Bank and IMF-sponsored structural adjustment programs<br/></p></td></tr><tr><td><p> U.S.-Central American Free Trade Agreement (CAFTA) signed in May 2004 between the US and Guatemala, El Salvador, Honduras, Costa Rica, Nicaragua<br/><a class="refanch small" href="http://www.citizen.org/Page.aspx?pid=1046" target="_blank">[click to view]</a></p></td></tr><tr><td><p> Resolution 019-2005-P-MINAE by Costa Rican government which invalidates oil drilling concessions to Harken<br/></p></td></tr><tr><td><p> Sentence No. 1754-2014, December 2014 in favor of the State (vs. Harken Energy)<br/><a class="refanch small" href="http://www.feconcr.org/doc/sent%2005-323-163-ca.pdf" target="_blank">[click to view]</a></p></td></tr></table></td></tr><tr><td class="fld">References</td><td><table><tr><td><p> El alto costo del petroleo barato. World Rainforest Movement, 2000<br/><a class="refanch small" href="http://www.wrm.org.uy/oldsite/boletin/32/indice.rtf" target="_blank">[click to view]</a></p></td></tr><tr><td><p> Las empresas petroleras: las nuevas socias de las Naciones Unidas. Oilwatch, 2002<br/><a class="refanch small" href="http://www.oilwatch.org/documentos/declaraciones/31-las-empresas-petroleras-las-nuevas-socias-de-las-naciones-unidas" target="_blank">[click to view]</a></p></td></tr><tr><td><p> Guerra y petroleo: artifices de la historia del siglo XX. Oilwatch, 2002<br/><a class="refanch small" href="http://www.oilwatch.org/doc/documentos/johanwar-esp.pdf" target="_blank">[click to view]</a></p></td></tr><tr><td><p> Moratoria a la exploracion y explotacion de hidrocarburos en areas naturales protegidas. Oilwatch, 2006<br/><a class="refanch small" href="http://www.oilwatch.org/doc/campana/areas_protegidas/moratoria_aps-esp.pdf" target="_blank">[click to view]</a></p></td></tr><tr><td><p> Actividades hidrocarburiferas en areas protegidas. Oilwatch, 2003<br/><a class="refanch small" href="http://www.oilwatch.org/doc/campana/areas_protegidas/areasprot-esp.pdf" target="_blank">[click to view]</a></p></td></tr><tr><td><p> The threat to the environment from the Central America Free Trade Agreement (CAFTA): The case of Harken Costa Rica Holdings and offshore oil by Friends of the Earth and NRDC<br/><a class="refanch small" href="https://www.citizen.org/documents/HarkenCRfactsheet.pdf" target="_blank">[click to view]</a></p></td></tr><tr><td><p> Ecological debt and oil moratorium in Costa Rica, Oilwatch Costa Rica, August 2005<br/><a class="refanch small" href="http://www.oilwatch.org/doc/campana/deuda_ecologica/deuda_costarica_ing.pdf" target="_blank">[click to view]</a></p></td></tr><tr><td><p> Resolution 248-2008<br/><a class="refanch small" href="http://www.feconcr.org/images/harken%20resoluci%F3n%20248-2008.pdf" target="_blank">[click to view]</a></p></td></tr><tr><td><p> Sentence No. 1754-2014<br/><a class="refanch small" href="http://www.feconcr.org/doc/sent%2005-323-163-ca.pdf" target="_blank">[click to view]</a></p></td></tr></table></td></tr><tr><td class="fld">Links</td><td><table><tr><td><p> Grupo Adela<br/><a class="refanch small" href="http://www.grupoadela.org/" target="_blank">[click to view]</a></p></td></tr><tr><td><p> Harken oil versus Costa Rica, Ecologist, 34 :4, May 2004<br/><a class="refanch small" href="http://cro.ots.ac.cr/rdmcnfs/datasets/biblioteca/pdfs/nbina-3240.pdf" target="_blank">[click to view]</a></p></td></tr><tr><td><p> Pacheco Stands Firm Against Oil Drilling, Adela, 10/10/2003<br/><a class="refanch small" href="http://www.grupoadela.org/prensa/ticotimes1003b.html " target="_blank">[click to view]</a></p></td></tr><tr><td><p> Free trade agreement threatens Costa Rican environmental protections, N. Martinez, 27/03/2004<br/><a class="refanch small" href="http://grist.org/article/engler/" target="_blank">[click to view]</a></p></td></tr><tr><td><p> Costa Rica: Oil extortion, WRM's bulletin Nº 75, October 2003<br/><a class="refanch small" href="http://wrm.org.uy/oldsite/bulletin/75/CostaRica.html" target="_blank">[click to view]</a></p></td></tr><tr><td><p> Costa Rica gana batalla legal contra petrolera, E & N, 17/12/2014<br/><a class="refanch small" href="http://www.estrategiaynegocios.net/centroamericaymundo/centroamerica/costarica/777628-330/costa-rica-gana-batalla-legal-contra-petrolera" target="_blank">[click to view]</a></p></td></tr><tr><td><p> Mal precedente sería pagar a Harken, Semanario Universidad, 12/02/2004<br/><a class="refanch small" href="http://semanariouniversidad.ucr.cr/pais/mal-precedente-sera-pagar-a-harken/" target="_blank">[click to view]</a></p></td></tr><tr><td><p> Costa Rica gana juicio a petrolera Harken, Federacion Ecologista, 16/12/2014<br/><a class="refanch small" href="http://www.feconcr.org/index.php?option=com_content&task=view&id=2407" target="_blank">[click to view]</a></p></td></tr></table></td></tr><tr><td class="fld">Media Links</td><td><table><tr><td><p> David derrota a Goliat: Harken fuera de Costa Rica, 4/03/2015<br/><a class="refanch small" href="https://www.youtube.com/watch?v=y8lgM015nGE" target="_blank">[click to view]</a></p></td></tr></table></td></tr><tr><td class="fld">Other Documents</td><td><table><tr><td><p><strong>Protest organized by oilwatch and ADELA in February 2004 during Harken's representative Robert Torricelli's visit</strong> Source: http://semanariouniversidad.ucr.cr<br/><a class="refanch small" href="https://file.ejatlas.org/docs/costa_rica_bis.jpg" target="_blank">[click to view]</a></p></td></tr></table></td></tr></tbody></table></div></div><div class="horipane"><div class="title active">Meta Information</div><div class="content"><table class="table"><tbody><tr><td class="fld">Contributor</td><td>Lucie Greyl & Camila Rolando Mazzuca</td></tr><tr><td class="fld">Last update</td><td>16/02/2016</td></tr></tbody></table></div></div>
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