Skip to main content

Newest Scam on Fringe of Climate Change Involves Land-Grabs in Peruvian Rainforest

When the United Nations process on climate change unveiled the program known as Reducing Emissions from Deforestation and Forest Degradation (REDD) three years ago, it was hailed by its architects as “an effort to create a financial value for the carbon stored in forests, offering incentives for developing countries to reduce emissions from forested lands and invest in low-carbon paths to sustainable development.” In December 2010, the program was redubbed REDD+—to emphasize the role of conservation, sustainable management of forests and enhancement of forest carbon stocks.

REDD is part of a larger plan to trade carbon credits to provide an incentive to keep forests standing. The seller of the credits (generally a government or land-holder in the developing world) is paid to keep carbon sequestered in forests. The purchase of these credits allows the buyer (generally a company in the industrialized world) to engage in activities that emit carbon. Environmental groups and nongovernmental organizations (NGOs) generally serve to broker and help oversee the deals. Each ton of emitted carbon per purchased credit can be deducted from the yearly toll when computing emission caps established for participating nations under the Kyoto Protocol. In theory, this will result in a net reduction in global emissions by offsetting carbon released through industrial pollution.

But indigenous leaders gathered at December’s U.N. climate summit in Durban, South Africa, charged that projects initiated under the REDD program are eroding Native control of forest territories. One case in Peru’s Amazon rainforest brings these accusations into sharp focus. A proposed deal involving the remote Matsés indigenous people and an Australian dubbed by critics as a “carbon cowboy” named David Nilsson has led to protests, legal charges, and a controversy concerning Internet censorship.

The Matsés live in the Loreto region of Peru’s northern Amazon—principally along the Río Yavarí, which forms the border between Peru and Brazil, and its tributary the Gálvez. Only “contacted” in the 1960s, the Matsés have legal title to a far larger land area than any other indigenous people in Peru—452,735 hectares, known as the Matsés Native Community, and titled to them in 1998. It covers 14 communities, each with its own leader, who participates in a general assembly to govern the territory.

This titled land covers about half the Matsés’ traditional territory; the remainder is protected as the Matsés National Reserve, declared in 2009, and (despite its name) under the control of Peru’s national government. The Matsés are still petitioning the government for expansion of their titled territory, as well as a role in managing the Matsés National Reserve.

Shortly after the creation of this second reserve, Nilsson began eyeing Matsés territory, working through a Hong Kong–registered company called Sustainable Carbon Resources Ltd. (SCRL). Established in November 2010, SCRL appears to have no physical office in Hong Kong.

SCRL first attempted to enter talks on a carbon deal with the Loreto regional government, based in the Amazon River port of Iquitos. Apparently failing to win much interest, Nilsson next approached the Matsés. In an exchange of letters, Matsés chief Angel Dunu Maya agreed to a meeting between Nilsson and the Matsés headmen in March 2011. At the meeting, in Iquitos, Nilsson reportedly held out the prospect of high returns from the sale of carbon credits. SCRL drafted a joint venture agreement—in English—and a meeting was scheduled for mid-April with the Matsés General Assembly, to sign the agreement. The meeting was to be held in the Matsés’ own territory.

Contacted by e-mail, Nilsson denies that the joint venture agreement was a contract—the word widely used in local Peruvian press accounts of the affair.

An ugly picture is painted in local media accounts. At the Iquitos meeting, the Matsés were told that the contract must be in English because “the World Bank and the U.N. only recognize the English language” for carbon contracts, according to witnesses quoted by the Iquitos newspaper La Región. Matsés leaders were told they would reap “billions of dollars” from the deal, according to indigenous testimony in the newspaper. Nilsson denies these claims.

Nilsson sent Indian Country Today Media Network an electronic document which he purports is the same one presented to the Matsés, with each page marked “draft for discussion purposes only.” The document states that the agreement is to be governed by the “laws of England and Wales.” It states that the Matsés will “irrevocably” grant SCRL power of attorney. It states that SCRL is to retain “sole property” rights over “all intellectual property” derived from the project. Carbon rights would remain the property of the Matsés, but SCRL would maintain a “lien over such carbon rights until payment of its share” to the Matsés community—after “project expenses” are met.

The plan, which called for Nilsson to broker the sale of carbon credits to third parties, immediately met with dissension among the Matsés. Although supposedly a joint venture, with profits to be divided 50-50 between the Matsés and SCRL, opponents charged that the agreement granted considerable control over Matsés territory to SCRL for an open-ended period. On April 13, the Matsés General Assembly moved to reject the proposal, finding it detrimental to the rights and interests of their people.

Nilsson did not show up for the scheduled meeting—and claims that he received death threats while waiting in Iquitos to receive word from the Matsés, causing him to make a police report and go into hiding according to his e-mail.

Instead of accepting the deal, the Matsés chiefs contacted the Inter-Ethnic Association for the Development of the Peruvian Rainforest (AIDESEP, by its Spanish acronym), Peru’s alliance of Amazonian Indigenous Peoples. In late April, AIDESEP called a meeting of regional apus—traditional indigenous leaders—in Iquitos to discuss the matter. The meeting issued an Iquitos declaration, rejecting such carbon deals and demanding the expulsion of Nilsson from Peru.

According to the Forest Peoples Programme’s recent report on REDD, at the Iquitos meeting, AIDESEP leader Alberto Pizango said that carbon could be the next rainforest resource to threaten indigenous control of lands: “[Here] in the Peruvian Amazon…there is a new boom, a new fever just like for rubber and oil but this time for carbon.… The companies, NGOs and brokers are breeding, desperate for that magic thing, the signature of the village chief on the piece of paper.… We denounce this ‘carbon piracy’.… ”

One Matsés leader also contacted the authorities, accusing Nilsson of bad faith. Daniel Jiménez, the Matsés headman for the community of Estirón, approached Peru’s national Ombudsman’s Office, the Defensoría del Pueblo, calling for an investigation of Nilsson and his “strange offers of huge profits” to his people, AIDESEP said in the Forest Peoples report.

Nilsson asserts in an e-mail that Jiménez presented the Defensoría with a doctored document based on a draft agreement for a project in the Philippines that had been stolen from his computer—with the names changed to make it look like the proposed agreement with the Matsés. He claims Jiménez was manipulated in this subterfuge by the Iquitos-based conservationist who had helped put him in touch with the Matsés, Dan James Pantone, formerly of Texas A&M University. Nilsson says Pantone chose Jiménez to present the doctored document because he “could not read English.”

Pantone, reached by e-mail, accused Nilsson of “smears” and said he has brought a defamation lawsuit against him in the Peruvian courts. He says he is confident that computer forensics experts will clear him of doctoring any documents, and expects Nilsson to face prosecution for making false claims. An electronic document Pantone sent ICTMN, purported to be the same that was turned over to the Defensoría, was identical to the one sent to ICTMN by Nilsson as the authentic joint venture agreement. The document does, idiosyncratically, refer to the Matsés community as “the Province,” indicating it was drawn up on the template of an earlier document, possibly intended for a Philippine province.

In July, Nilsson brought a formal complaint against Jiménez before the local prosecutor for Loreto’s Maynas province, accusing him of crimes, including “coercion, fraud, aggravated theft, extortion in the form of blackmail [and] falsified declarations and documents.” The local prosecutor did not find enough evidence to pursue the charges, but Nilsson is appealing to the regional prosecutor.

AIDESEP says its attorneys had reviewed SCRL’s company records before the Iquitos meeting, which indicate it had capital of only 10,000 Hong Kong dollars—some $1,300. REDD-Monitor, a website critical of the U.N. program, gave much coverage to the scandal, coining the term “carbon cowboy” for Nilsson.

Both La Región and REDD-Monitor reported on questionable deals in Nilsson’s past. They cited Queensland parliamentary records of a controversy concerning the sale of apparently nonexistent plots of land in the Australian state to purchasers in the South Pacific island nation of Nauru. Nilsson was cleared of any wrongdoing in the case and said he is considering litigation over what he considers “fraudulent” claims.

Nilsson, meanwhile, has approached another rainforest people in Loreto with a REDD project. Working through another Hong Kong–registered firm, Amazon Holdings Ltd. according to REDD-Monitor, and a new group called Conservation and Sustainable Social Inclusion for the Amazon, Nilsson this time approached the Yaguas people of the Apayacu River (a tributary of the Amazon proper, downstream from Iquitos) in late 2011. Under the proposal, Amazon Holdings would sell timber from the region in China, according to REDD-Monitor. The Sydney Morning Herald suggests Nilsson seeks to sell carbon credits generated by his Amazon projects to polluters in Australia.

The Federation of Native Communities of the Ampiyacu (FECONA), the indigenous organization for the

Apayacu and Ampiyacu watersheds, denounced the deal in a November 5 statement, charging that involvement in such a scheme had “divided and pressured the Matsés people.” Decrying the free hand granted to carbon-prospectors in Loreto, FECONA called upon regional president Iván Vásquez to “publicly define” his relationship with Nilsson.

There are other REDD+-related controversies brewing in Peru:

• At the 2008 U.N. climate summit in Pozna?, Poland, Peru’s Ministry of the Environment announced the establishment of its national forest conservation program, with the aim of protecting 54 million hectares of forest and reducing net deforestation to zero by 2020. Peru has since been chosen as a pilot country for the World Bank’s Forest Carbon Partnership Facility and Forest Investment Program, and has won approval for more than $350 million to implement REDD+ plans.

• In March 2011, AIDESEP responded to the Peruvian government’s submission of its REDD Readiness Preparation Proposal to the World Bank, charging that “today in Peru there are companies that in the name of REDD are pressuring communities” to give up their carbon rights, calling it “unacceptable exploitation.”

• In the same year’s Iquitos declaration, the gathered apus warned that the REDD program as currently conceived “is driven towards false solutions for global climate aggression,” which only serve “speculative financial gains.”

At the 2010 climate summit in Cancún, an international consensus was reached that REDD+ can only succeed if the rights of rainforest inhabitants are respected. Yet some 35 REDD-type projects have been launched in Peru, potentially covering up to 7 million hectares—in some cases, without the land rights of the affected peoples being clarified.

Peru has almost 70 million hectares of tropical rainforest—only some 15 million hectares of which are under indigenous title or management. At least 8 million hectares under pending application for proposed indigenous communities and reserves, and hundreds of indigenous communities are thought to remain in isolation with no official existence.

AIDESEP charges that isolated peoples such as the Yora and the Amahuaca are threatened by REDD-type plantation projects related to the Interoceanic Highway from Brazil now being built through the Madre de Dios region, in the southern Amazon. With no immunity to new diseases, it could spell their doom if outsiders are brought into their territories under these plans.

One Madre de Dios logging concession has been REDD-certified by the Forest Stewardship Council, an independent, nongovernmental, not-for-profit organization established to promote the responsible management of the world’s forests—despite claims of isolated peoples in the area. The company involved, Maderacre, has already sold carbon credits to a China-based wood-flooring company, Nature Floor Holdings Ltd.

According to AIDESEP, the Alliance for the Capture of Carbon as a Solution to Climate Change, an NGO, has proposed 10-year agreements with various communities of the Shipibo people in Loreto which would effectively give the NGO control of their titled lands.

At the December climate summit in Durban, the Global Alliance of Indigenous Peoples and Local Communities against REDD and for Life, with representatives from across the Americas, issued a statement calling for a moratorium on the REDD+ program. The statement claimed “evidence that Indigenous Peoples are being subjected to violations of their rights as a result of the implementation of REDD+-type programs and policies.”

Numerous such claims emerged on the sidelines at Durban.

From Brazil, it was reported that Chevron, General Motors and American Electric Power and Sociedade de Pesquisa em Vida Selvagem e Educação Ambiental, under the auspices of the Nature Conservancy, have established the Guaraqueçaba Climate Action Project in the ancestral territory of Guaraní people in Paraná state. The project is policed by uniformed armed guards called the Força Verde or Green Force, who are accused of intimidating local communities, even detaining and shooting at residents who enter forest land in the project area.

In Bolivia, BP and American Electric Power are participating in the world’s biggest REDD-type project at Noel Kempff Mercado National Park in the territory of the Chiquitano people of lowland Santa Cruz department. Critics at Durban charged the project helps BP “to greenwash its destruction of biodiversity and communities’ livelihoods.” A Greenpeace report on the project slammed it as a “carbon scam,” pointing to the phenomenon of “leakage”—that is, tree-felling being pushed beyond the borders of the park. Greenpeace has called for eliminating “subnational” REDD projects—meaning that unless a nation as a whole cuts deforestation, then nobody gets any carbon credits.

Ecuador’s government continues to develop a REDD program—over the protests of the Confederation of Indigenous Nationalities of Ecuador (CONAIE), which has explicitly rejected the implementation of any REDD projects in the country.

The state of California is promoting REDD-type projects for its own “subnational” carbon market in Chiapas, Mexico; Acre, Brazil; Aceh, Indonesia; and Cross River, Nigeria.

In Chiapas, the Tzeltal Maya of the community of Amador Hernández has denounced the project as a scheme “to cover up the dispossession of the biodiversity of the peoples.” The project lies within the Lacandon Community Zone of the Chiapas rainforest, where Amador Hernández and several other settlements are officially slated for relocation, ostensibly to protect the forest in this protected area. Residents charge the Mexican government’s real reason for relocation is to undercut the support base of the Zapatista rebels, who control much of the zone. Amador Hernández has asked the Chiapas state government to “suspend the state REDD+ project in the Lacandon Community Zone, as it constitutes a counterinsurgency plan that promotes conflicts between neighboring communities.”

Last year, a report by the International Federation of Human Rights (FIDH) prompted European investors to withdraw from a carbon-credit project under the Kyoto Protocol’s Clean Development Mechanism in the conflicted Lower Aguán Valley of Honduras. The project would generate carbon credits through oil palm plantations, in a region where land conflicts have left several campesino leaders dead over the past months. The FIDH report prompted the European Parliament to order a fact-finding mission, placing the project’s future in doubt.

In the Mau Forest Complex of Kenya’s Rift Valley, communities of the local Ogiek indigenous people are being forcibly evicted by government troops to make way for a REDD-related project, organizations such as Minority Rights Group International report. Ogiek activists have been attacked for protesting what they see as a land grab.

Forcible evictions—even the torching of homes by security forces—are also reported from the Mubende and Kiboga districts in Uganda, where the U.K.–based New Forests Company is growing pine and eucalyptus under a 50-year government lease to generate carbon credits. The aid group Oxfam International says it has received reports of up to 20,000 Uganda residents evicted in the region in recent years. Security forces have used firearms, with at least one death reported. The Ugandan government calls the evicted communities illegal encroachers on the protected lands.

In the Rufiji Delta mangrove forest of Tanzania, communities of the indigenous Warufiji people are being

barred from cultivating their traditional lands as the government prepares a REDD-type project for the region backed by the World Wildlife Fund, according to reports aired at Durban.

Forced evictions have also been reported from Jambi, on the Indonesian island of Sumatra, where the firm PT Asiatic Persada, majority-owned by Singapore’s Wilmar Group, has been granted a concession to grow oil palms under a REDD-type project.

Shell Oil and the Russian energy giant Gazprom are jointly underwriting the Rimba Raya Biodiversity Reserve REDD Project in Indonesian Borneo, or Kalimantan—where Indigenous Peoples have for a generation been struggling for control of their lands against an onslaught of settlers and resource industries. The project is supported by former president Bill Clinton’s foundation, which focuses on global environmental issues; in this case supported basically means brokering the sale of carbon credits.

In Papua New Guinea, the Australian company Carbon Planet is accused of coercing indigenous villagers to sign over the rights to their forests for REDD-type projects. The Papua New Guinea government has launched an investigation into the charges, and the head of the Office of Climate Change was removed in 2009 in response to the scandal.

ConocoPhillips’s underwriting of a carbon-trading project in Australia’s Northern Territory has drawn criticism from Native peoples in North America affected by the company’s pollution. Under the Western Arnhem Land Fire Abatement Project, the oil giant is paying the local Jawoyn aboriginal group to run a firefighting force, using its traditional knowledge of controlled burns to preserve the forest. The carbon credits generated are supposed to be officially used to offset emissions from ConocoPhillips’s liquefied natural gas plant in Darwin Harbor.

But Casey Camp-Horinek, a member of the Ponca nation in Oklahoma, told the U.N. Permanent Forum on Indigenous Issues in New York in 2009, “Indigenous Peoples who participate in carbon trading are giving ConocoPhillips a bullet to kill my people.”

Contacted by phone at her home near Ponca City, Oklahoma, Camp-Horinek accused ConocoPhillips of “environmental genocide” against her people. With a refinery established within Ponca trust lands, thanks to private inholdings created by allotment, cancer and autoimmune disorders are widespread among the Ponca. Conoco also built a plant producing “carbon black” (the stuff that makes tires black) near Ponca City, since sold to another firm.

“There isn’t a family here that doesn’t have members who have died from cancer,” says Camp-Horinek. “We are dropping like flies, and we are a small tribe of just 3,000 or so.” Speaking of the Australian aborigines who have signed on with ConocoPhillips, she says: “Those people don’t know that they are literally giving them permission to annihilate indigenous populations.”

In May 2011, AIDESEP hosted a follow-up conference on the REDD controversy in Iquitos, this time attended by indigenous representatives from across the Peruvian Amazon. The conference called for an “indigenous REDD” predicated on Native control of land. But it also proclaimed that climate change can only be halted by systemic change in the industrial world.

The conference’s closing statement said, in part: “The industrialization of the developed countries…has brought about a blind race that today has lamentable consequences for the world. If the West would scale back its economic ambitions, and would only learn a little from Indigenous Peoples, perhaps it would live better, in harmony with its surroundings and the planet Earth.”