Sunday, September 13, 2026
News and Views from the Global South
FINANCE: Groups Urge Bank to Deny Enron Loan for Bolivian Pipeline
Emad Mekay
- Civil society groups are urging the Inter-American Development Bank (IDB) to think hard before giving shamed energy giant Enron and oil and gas producer Shell millions of dollars to finance expansion of a controversial gas pipeline in Bolivia.
Amazon Watch, Friends of the Earth, and the Washington-based Institute for Policy Studies say that the IDB could be moving to give a 125-million-dollar loan to the two companies to finance work on the questionable Yabog pipeline, despite their ”egregious social and environmental track record in Bolivia”.
In a joint study released late Thursday, the groups say that environmental and economic problems associated with previous similar pipeline projects should be warning enough to the IDB not to give taxpayers’ money to Enron, whose shady accounting practices are still being investigated in the United States.
”The evidence presented in this report, which is based on our audit of the former (Cuiaba and Bolivia-Brazil) pipelines, is an overwhelmingly sufficient basis to prove that the Inter-American Development Bank would be negligent to finance the Yabog pipeline, even if Enron sells its stake in the company,” said the report.
The groups called on the U.S. government – which controls 30 percent of the IDB – to rebuff Enron’s request for public money.
Enron and Shell hold 25 percent of Transredes, the company seeking the loan from the IDB for the expansion of the Bolivian gas pipeline. They jointly have administrative control.
This week, President Gonzalo Sanchez de Lozada of Bolivia, who brokered the partial sale of the national state oil and gas company to Enron and Shell, is in Washington meeting with U.S. President George W. Bush and IDB officials to win backing for the Yabog project, for plans to exploit Bolivia’s gas reserves, and for a proposal to export vast quantities of gas from Bolivia to California.
The shamed Enron, a now bankrupt firm with dubious off-balance sheet transactions, continues to operate internationally and is still seeking public funding for its non-scrutinised global projects, activists warn.
According to the Institute for Policy Studies, Enron’s assets in Latin America include concerns in a pipeline in Colombia, gas and electricity companies in Venezuela and Brazil, and other operations in Panama, Guatemala, and Puerto Rico.
Public institutions, including the World Bank and the European Investment Bank have provided Enron with financing of about seven billion dollars, the Institute said.
This time around, activists are hoping that public money will not be used for a project they say will further destroy ecosystems.
"IDB’s rejection of this loan will send an important signal to Enron and others that they can no longer count on public coffers to underwrite the devastation of globally treasured ecosystems,” said Atossa Soltani, executive director of Amazon Watch.
In their report, the groups say that Enron and Shell’s Cuiaba pipeline gained international notoriety for degrading the last most intact dry tropical forest in the world.
The companies made a bad decision by building the pipeline through the Chiquitano Forest and Pantanal wetlands and then later implementing what the report calls a ”botched conservation programme”.
It says the companies also failed to ”mitigate” impacts, such as illegal hunting and logging along the pipeline route. Such activities also accelerated deforestation, the report adds.
The IDB’s upcoming vote on the Yabog pipeline comes after the U.S. government’s Overseas Private Investment Corporation (OPIC) cancelled a 200-million-dollar loan for the Cuiaba pipeline, and asked the Department of Justice to investigate Enron for violations of the Foreign Corrupt Practices Act. Enron was OPIC’s largest client.
In their report the groups also warn that a second proposed gas pipeline, the Camisea Project in Peru, is just as flawed as Yabog and the previous two projects.
They say that the IDB and the U.S. Export-Import Bank are currently considering financing for Camisea, a massive gas field and pipeline project proposed by small energy companies, even though the firms have poor environmental records and limited technical capacity.
Camisea is globally renowned as a biodiversity hotspot and is home to up to 1,000 indigenous peoples who have little contact with the outside world and to 7,000 traditional Machiguenga people.
The proposed project violates World Bank policies on the environment and indigenous peoples and also contravenes indigenous rights, says the report.
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FINANCE: Groups Urge Bank to Deny Enron Loan for Bolivian Pipeline
Emad Mekay
- Civil society groups are urging the Inter-American Development Bank (IDB) to think hard before giving shamed energy giant Enron and oil and gas producer Shell millions of dollars to finance expansion of a controversial gas pipeline in Bolivia.
(more…)
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