Can Lula’s Novo PAC Fix the Oiapoque Problem with Block 59?

This month, Brazilian President Luiz Inacio Lula da Silva launched the new Novo PAC economic stimulus program to restart construction on idle infrastructure projects and fuel growth in 2024.

Novo PAC includes targeted spending at the state and local levels, which could help elect Lula allies in next year’s municipal elections. The spending program could also contribute to resolving the environmental licensing controversy surrounding Block 59 in the offshore Foz do Amazonas Basin.

Brazil’s environmental protection agency IBAMA rejected Petrobras’ license application for exploratory drilling in Block 59, located 175km from the coast of Amapá and 500km from the mouth of the Amazon river. For over a decade, environmental protection advocates and some scientists have warned that E&P activities in the northeast region of Brazil could threaten the Great Amazon Reef System (GARS) which stretches from Amapá — the northernmost state in the country — to the Ceará Basin. Indeed, spills could hurt fisheries and other livelihoods of the Oiapoque municipality and Indigenous communities at the border with French Guinea.

The Oiapoque Indigenous Community Leaders Council (CCPIO) has often criticized Petrobras for failing to consult over relocating the garbage at the Oiapoque airport to their land, after Petrobras ramped up helicopter flights to inspect the offshore E&P play.

Indeed, Petrobras’ 2021 Social Communication Plan, submitted with its environmental license request, did not identify CCPIO as a civil society stakeholder. For CCPIO, Petrobras should rectify the negative environmental impacts of the dump relocation. In other words, if the company cannot mitigate the dump’s effects on the community’s livelihood, it probably cannot respond to an emergency crude oil spill that could permanently destroy their fishery and tourism industries.

Petrobras has a long way to go to satisfy IBAMA and residents of Oiapoque, but the company and the federal government have taken steps recently to break through the local logjam. On 13 February, representatives of CCPIO met with Petrobras, the National Indigenous Peoples Foundation and IBAMA, along with Amapá Secretary of Indigenous Affairs Simone Karipuna, agreeing to set up a working group. A month later, Governor Clécio Luís, an ally of Lula, attended the 29th Assembly of Indigenous People Leaders of Oiapoque, representing 67 villages in the municipality under the CCPIO banner. Luís pledged to work with the leaders to improve education, health and infrastructure, defend the community’s culture and promote its agriculture and fisheries.

With Lula’s Novo PAC, the Amapá governor will have the resources to meet some CCPIO demands. The federal spending program has earmarked substantial spending for Oiapoque, including:

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? A solid residue management study that could help alleviate the controversy over the garbage dump.

? Construction of 50 housing units under the My Home, My Life program as well as primary education infrastructure, including daycare centers and schools.

? Equipment to address public health emergencies.

? A feasibility study to develop marine transport and terminals.

These spending projects will not satisfy all CCPIO demands. But they do show good faith, promising to lessen opposition to the Lula administration’s hope to license Block 59 for exploratory drilling. Of course, if Petrobras is allowed to drill in the Foz do Amazonas and strikes black gold, then Oiapoque would benefit from royalties.

However, there is a hitch to the political equation. Oiapoque’s mayor, gas station owner Breno Lima De Almeida, is a member of a conservative party allied with former President Jair Bolsonaro. Also, the city council is dominated by pro-Bolsonaro forces. Historically, the city government has marginalized Indigenous communities from local governance.

To break the Oiapoque logjam, Petrobras and the Lula administration, working with Gov. Luís, will have to directly engage the municipal government to ensure that Novo PAC spending reaches CCPIO constituents. They will also need to show that efforts to rectify the fallout of relocating the garbage dump deliver tangible results. If the company and the government can satisfy Indigenous leaders, that will remove an obstacle for Petrobras to get an environmental license for Block 59.