RIO DE JANEIRO — Brazil’s environmental regulator refused on Wednesday to grant a license for a controversial offshore oil drilling project near the mouth of the Amazon River, prompting celebration from environmentalists who had warned of its potential impact.
The decision to reject the state-run oil company Petrobras’ request to drill the FZA-M-59 block was made “as a function of a group of technical inconsistencies,” said the agency’s president, Rodrigo Agostinho, who highlighted environmental concerns.
With Brazil’s existing production set to peak in coming years, Petrobras has sought to secure more reserves off Brazil’s northern coast. The company earmarked almost half its five-year, $6 billion exploration budget for the area.
CEO Jean Paul Prates said the well was temporary, and the company had never experienced a spillage in its offshore drilling. The company failed to convince the environmental agency.
“There is no doubt that Petrobras was offered every opportunity to remedy critical points of its project, but that it still presents worrisome inconsistencies for the safe operation in a new exploratory frontier with high socioenvironmental vulnerability,” Agostinho wrote in his decision.
The unique, biodiverse region is home to coral reefs and mangrove stretches that have been little studied. Experts and activists had warned of the dangers the project posed for the environment.
Eighty civil society and environmental organizations, including WWF Brasil and Greenpeace, had called for the license to be rejected pending an in-depth study.
“Agostinho is protecting a virtually unknown ecosystem and maintains the coherence of the Lula government, which has promised in its discourse to be guided by the fight against the climate crisis,” the Climate Observatory, a network of environmental non-profits, said in a statement.
From 2003 until 2010,, the huge offshore finds were used to finance health, education, and welfare programs during Luiz inacio Lula’s first term as president. Some of the members of Lula’s Workers’ Party still see oil as an important tool for social advancement.
Energy Minister Alexandre Silveira said in March that the area is the “passport to the future” for development in Brazil’s northern region. Lula had used this phrase in his previous terms to describe offshore oil discovery made in an area called pre-salt.
But Lula is trying to show the change in environmental consciousness he’s undergone since then. The protection of Amazon was a major part of his last-year campaign to unseat Jair Bosonaro, and to return to the presidency.
Activists and experts had warned that approval for the offshore oil project could threaten the natural world, but also dent Lula’s newfound image as an environmental defender.
The process to obtain an environmental license for the FZA-M-59 block began in 2014, at the request of BP Energy do Brasil. In 2020., Petrobras acquired exploration rights.
Suely Araujo is a climate policy expert at the Climate Observatory and a former director of the Environment Agency. She said Agostinho was right to make the decision, not only for this project but for the entire nation.
“The decision in this case gives cause for a broader debate about the role of oil in the country’s future. It is time to establish a calendar to eliminate fossil fuels and accelerate the just transition for oil exporting countries, such as Brazil, and not open a new exploration frontier,” Araujo said in a statement. “Those who sleep today dreaming of oil wealth tend to wake up tomorrow with a stranded asset, or an ecological disaster, or both.”
Other controversial megaprojects in the Amazon that remain on the table include repaving a highway that would slice through preserved rainforest, construction of a major railway for grain transport and renewal of a giant hydroelectric dam’s license.
Associated Press writer Eleonore Hughes in Rio de Janeiro contributed to this report.
The article Oil Project near Amazon River Mouth Blocked by Brazil’s Environment Agency first appeared on Associated Press .