EnCana criticized for Ecuador activities

At its annual general meeting in Calgary on April 28, EnCana shareholders criticised the company for its pipeline activities in Ecuador. As this excerpt from the April 29 Globe and Mail shows, the company’s practices are coming under increasing scrutiny.

Although EnCana is a leading player in North America, it’s also active abroad, including in places such as the North Sea and Ecuador.

EnCana’s oil output in Ecuador, which accounts for 10 per cent of its total energy production, caught the attention of several angry shareholders, environmentalists and human rights activists.

Peppered for an hour by questions into EnCana’s involvement in the South American country, Mr. Morgan stood his ground, saying his firm has been a good corporate citizen.

Nadja Drost, a campaigner for GlobalAware Canada, was among the speakers who criticized the Canadian producer for allegedly having lax environmental standards, providing insufficient compensation to landowners and ignoring the concerns of indigenous groups.

Mr. Morgan countered that EnCana embraces a collaborative approach in Ecuador and has been forging bonds with residents. He cited EnCana’s funding for health and education programs as examples of how the company is committed to acting responsibly.

[excerpt from ” Encana profit sinks”, Brent Jang, The Globe and Mail, April 29 2004.]

The National Post said the company,

…came under fire over its oil operations in Ecuador yesterday, as representatives of non-governmental organizations dominated its annual meeting with charges that its activities are fostering human rights abuses and damaging the Amazon’s ecosystem.

The Calgary Herald reported that Morgan views the criticisms as insubstantial, and referred to them as “drive-by innuendoes”.

We would suggest that EnCana has grown beyond its history as a modest Canadian oil and gas producer. As it assumes dominance in the industry, as a multi-national, its performance and activities and ethics will be examined more closely.

Indeed, like leading corporations in any industry (Microsoft, Monsanto, Arthur Anderson), EnCana will increasingly become a proxy for the industry.

Awareness is growing of the consequences of our dependence on fossil fuels, of the environmental, political and economic impacts that come with their production and consumption.

Public dialogue is moving to examination of that dependence – what are the problems with it, what keeps it going, what can we do to change it?

The corporations who produce, process, and distribute these fossil fuels emerge not just as disinterested participants, but as proponents, perpetrators, agents to keep the dependence intact. This, at the same time as we understand the overwhelming evidence that our use of fossil fuels is transforming earth, and could make it uninhabitable.

EnCana, a company which didn’t exist three years ago, now is in the top echelons of oil and gas producers. Welcome to the world of BP, Shell, Exxon.

EnCana is a tangible entity, a “name and a face”, to a greater problem – our fossil fuel dependency – and the corporation’s AGM is a forum in which to address that global issue, as much as it is to address EnCana’s specific role in it.

Shareholder criticism at the 2004 AGM is anything but “drive-by innuendo”, as Mr. Morgan dismissed it. It is more like small craft trying to avert the Exxon Valdes disaster.

This 2004 annual general meeting is just a foretaste of what is to come. EnCana is a flagship of an industry, an industry that is itself the Exxon Valdes of geo-political stability and democracy, of ecological sustainability.

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