The decision by Ecuadorian President Rafael Correa to abandon a plan to spare the species-rich Yasuní rain forest in eastern Ecuador from oil development has dashed hopes for what environmentalists had hailed as a historic approach to weaning industrial society from its dependence on fossil fuels.

(Read more about Yasuní National Park in National Geographic magazine.)

"Ecuador and the world have lost an opportunity to shape a revolutionary initiative," said Alberto Acosta, Ecuador's former minister of energy and mines, and one of the chief architects of the so-called Yasuní-ITT Initiative, which Correa unveiled to the international community in 2007. "It was a giant step on the road toward post-extractivism."

The initiative had called for leaving an estimated 850 million barrels of untapped Amazon crude in the ground in the Ishpingo, Tambococha, and Tiputini oil fields—the ITT Block—located inside Yasuní National Park.

In return for preserving the wilderness and preventing an estimated 410 million tons of carbon emissions from entering the atmosphere, Ecuador had sought from developed countries $3.6 billion in compensation, roughly half the revenues the country would have accrued from exploiting the resource.

The United Nations Development Program had set up a trust to administer the funds.

Scientists regard the Yasuní rain forest as one of the most bio-diverse places on Earth, teeming with an extraordinary abundance of birds, primates, reptiles, and amphibians. The park contains more tree and insect species in a single hectare (2.47 acres) than in all the U.S. and Canada combined.

Yasuní also harbors two groups of highly vulnerable, uncontacted indigenous people who wander the forests as hunter-gatherers in near-total isolation from the outside world. UNESCO designated Yasuní a World Biosphere Reserve in 1989.

The two isolated indigenous groups are factions of Waorani (Huaorani) that refused to accept contact with missionaries in the 1950s and '60s. Waorani leaders fear that continuing oil development in Yasuní poses a grave threat to their uncontacted brethren.