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Curacao refinery sputters on

WILLEMSTAD (Reuters) - An oil refinery dating from World War I billows toxins over the Caribbean island of Curacao and sickens some residents, but under the pressure of local economic need Curacao allows it to continue operating.

The Isla refinery, operated by Venezuelan state oil company PDVSA, faces growing complaints by residents and several lawsuits charging its industrial emissions cause health problems ranging from chronic coughing to cancer.

A Curacao court last year, citing a study estimating each year 18 people die prematurely from exposure to contaminants, threatened to close it if it cannot meet emissions standards.

Curacao commissioned the study from Dutch consulting company ECORYS in 2005, but didn’t make it public. ECORYS told Reuters it could not provide a copy of the study because of an agreement with the client.

Humane Care Foundation, a local environmental group, says emissions of sulphur dioxide, which can cause permanent lung damage, are about twice the limits allowed by Isla’s license. The group says the data was collected by the refinery itself.

It also says refinery emissions of particulate matter, fine dust that can cause cancer, are dangerously high. Isla has denied excessive particulate matter emissions.

The court decision is a rebuke to PDVSA, which prides itself on social responsibility inspired by Venezuelan President Hugo Chavez.

But PDVSA is under pressure to keep the 320,000 barrel per day facility running as it struggles with repeated outages at its own refineries in Venezuela. Gasoline from Isla is exported mainly to other Caribbean nations and South America.

With little money or support for upgrading Isla and in need of the jobs generated by the refinery, Curacao seems content to let PDVSA keep running it as long as courts allow.

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“There is no scientific study whatsoever that the refinery is causing death or anything like that,” said Charles Cooper, a Curacao legislator whose party is allied with Curacao’s governing party and who also works for PDVSA.

Public Health Commissioner Humphrey Davelaar did not respond to requests for comment. An Isla spokeswoman said she could not comment and a PDVSA spokesman did not respond to an email requesting comment.

Located 40 miles off the Venezuelan coast, Curacao became an affluent trading port in the Atlantic slave trade in the 17th and 18th centuries. Today a territory of the Netherlands Kingdom, it attracts tourists with its beaches, scuba diving and historic Dutch colonial architecture.

In April the Netherlands government urged the island to cut emissions at Isla, located in the heart of the capital of Willemstad on the site of a former slave market.

Shell opened Isla in 1918 to process Venezuela’s first crude oil, and it served as a major supplier to the Allies in World War II.

By 1985, it was obsolete and plagued by environmental woes, and Shell sold it to Curacao for a symbolic $1 (50 pence). The island quickly leased it to Venezuelan state oil company PDVSA, which has made few major investments to reduce emissions that produce heavy odours in the area around Isla.

Marisela Cijntje, who teaches Spanish at the Maria Immaculata Lyceum downwind from the refinery, says the stench is sometimes so overwhelming the school has to suspend classes,

“Sometimes I get out of my car and I can see the smoke or I can smell it,” said Cijntje. “It gives me a headache really quickly, but most of the time I just have to keep teaching.”

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Critics say PDVSA, which has been in talks to buy the refinery for two years, provides few benefits to the island.

They note this accusation almost mirror Chavez’s charges that private oil companies “looted” Venezuela by dodging taxes and failing to make investments that would have curtailed environmental damage.

Curacao took in less than 1 percent of Isla’s 2007 sales of $5 billion (2.51 billion pounds), receiving a rent payment of less than $20 million and almost no taxes. By contrast, PDVSA says that in Venezuela some 45 percent of its sales in 2007 went to government coffers and social programs.

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“Nowhere else in the world could a multi-million dollar company like PDVSA come and do something like this,” said Maurits Martis, 59, who runs a construction equipment shop across the road from Isla.

Critics also note that islanders pay around $1.20 per litre for gasoline produced at Isla, compared with the $0.03 per litre paid by Venezuelans, who have the world’s cheapest.

They also say the refinery’s 1,500 jobs are only around 2 percent of the island’s workforce of some 70,000. Government officials did answer requests for official workforce figures.

Isla says 2007 Curacao social investments were $5.2 million, some of which paid to put air conditioners in schools downwind from the refinery.

Refinery Director Pedro Jimenez in May said Isla was being singled out for polluting and that it would only address the problem in conjunction with other polluting industries.

Many on the island defend the refinery because of the jobs it provides. Workers at the refinery marched in June to protest a possible closure of Isla and accused the Netherlands of meddling in the island’s internal affairs.

And talk of its closure alarms even those who suffer from the emissions.

Sharvienne Hersilia, 19, a student at Maria Immaculata, says the fumes give her headaches and aggravate her asthma. But she thinks Isla should modernize operations, not close down.

“Closing it isn’t an option because a lot of fathers support their families by working there,” she said.

Additional reporting by Jorge Silva, Sebastian Rocandio, Efrain Adrade, Irasi Jimenez and Carolina Nicolaas in Willemstad, Janet Mcgurty in New York and Ank Kuipers in Paramaribo