EspañolPeru’s Minister of Energy, Eleodoro Mayorga, announced on Monday that the state-oil company Petroperu will soon begin a process of reorganization and purge its current board of directors. The announcement comes after the news program Panorama on Panamericana TV released a report on the company’s latest oil spill in the department of Loreto.

Beyond the critical damage the spill has caused to the environment and the economy of the region, Peruvians have been shocked to learn that the state-run oil company hired underage children to clean its spill with their bare hands, providing no special equipment or protective gear.

Pictures circulating in the media of minors covered head to toe in oil, cleaning the river in their underpants, has caused outrage in Peru. Petroperu representatives, however, deny any knowledge of the situation, and have promised to take action on the matter.

“We believe that the current board of directors is not achieving the company’s goals, and we will make some changes by adding a new group of people,” said Minister of Energy and Mines Eleodoro Mayorga. The minister continued by characterizing the decision as a “reaction to the way the company has faced certain issues, especially in the recent past,” pledging to “work on it” in the future.

On June 30, it was the fishermen of Loreto who first noticed the contamination and reported the oil spill coming from the Northern Peruvian Pipeline. The rupture in the pipeline occurred in the Santa Rosa community in the northeastern part of the country. The spill, however, affected several communities, including San Pedro, Urarinas, and Loreto. These areas depend primarily on fishing and hunting for their local economies. Since the spill, however, local inhabitants have found it impossible to continue their work in these fields and have demanded an immediate response from the state-run company.

According to community representative Arquimides Murayari, the company has yet to respond to their claims, and has instead denied the extent of its contamination. “They say its only a couple of gallons, or one barrel. That’s all they say. But this spill is about 400 barrels and it has contaminated the Curinico and Marañón rivers. Right now, the river is unsuitable for fishing. The population there lives off hunting and fishing, and now they are unable to sustain their livelihoods.”

The mayor of the city of Urarinas, Runtsma Barrera Vela, has said it took nearly 10 days for Petroperu to reply to their initial complaints regarding the oil spill. The company then implied that the oil spill was in some way provoked by the local community. The mayor immediately rejected these claims. “The community doesn’t even have the tools to manipulate such complicated structures,” he said. “How would provoking an oil spill benefit the [local] population?”

Mayor Barrera also noted that the contamination has brought with it various health risks, causing locals to suffer from diarrhea, vomiting, and infections. People in the area are not aware of the health hazards of eating or drinking from the contaminated river, explained the major.

“I dared him to take a sip from that water or to eat a fish [from the river]. He needs to stand in our shoes,” the mayor angrily said to the Petroperu representative after he denied their accusations.

A Remedy Worse than the Disease

While interviewing the locals, Panorama journalists encountered something even more astonishing than river contamination. A man who was hired to clean the river approached them and told them that he had been given protective equipment to wear just minutes before the cameras began filming. In the days before the journalists arrived, Petroperu had workers cleaning the oil spill wearing ordinary street clothes, often just a pair of shorts and a T-shirt.

After the man’s revealing confession to Panorama, others hired by Petroperu also came forward, including two underage children. Paid only PER$80 (approximately US$28), they were asked to submerge themselves in the contaminated river for roughly 8 hours a day, without protective gear or supplies beyond a pair of buckets.

One of the minors even showed the journalist pictures they had previously taken with their cellphones. The underage kids were completely covered in oil, shirtless, wearing only a pair of shorts.

Despite the photographic evidence, Víctor Mena, a representative of Petroperu, denied the existence of an oil spill, contamination, or the hiring of children. He then added that if the company had hired anyone underage, it was only because they’d shown fake IDs.

However, the sheer volume of videos and photographs coming from the area, clearing showing the extent of the environmental damage, proved Mena wrong. Petroperu eventually acknowledged the evidence and its culpability.

“We have seen what has happened with the pipeline over the last few days and we are concerned. It has given us the impression that the problem has not been addressed with transparency, and for us to enter into a new phase, with a new refinery and the will to expand our operations, we believe the company has to go through a reorganization process,” the minister stated.

The evidence was so strong that Petroperu was forced to issue a statement in response to Panorama‘s coverage of the incident.

“Petroperu does not hire, nor supports the hiring, of minors. Given the evidence of our hiring underage workers, we have opened an investigation.”

After the news initially broke, Labor Minister Ana Jara said the fine for the infraction could be as much as PER$700,000 (US$245,000), if the company were to be found responsible for hiring minors to clean the oil spill. Jara stated the Ministry of Labor had sent inspectors to find out who was responsible for the alleged underage hires.

Given Petroperu’s response to this environmental crisis, and two previous oil spills in the same area within a week, its reliability has been put into question.

José Luis Tapia, executive director of Peru’s Free Enterprise Institute (ILE), spoke with the PanAm Post regarding Petroperu’s recent actions and its future as a state-owned company.

For Tapia, the company’s decision to “reorganize” its staff will not have much of an effect unless there are also efforts to begin to remove the government from its management. “Every reorganization process that is oriented towards greater privatization of the company’s management helps to eliminate all these negative incentives that are seen in this case.”

However, Petroperu seems to be heading towards a very different direction. “If you analyze the legal framework that rules this company, you just can’t find any long-term vision. There are about 14 important norms, including laws and legislative decrees, which are directed more towards strengthening its nationalization than an eventual privatization.”

According to Tapia, this demonstrates that Petroperu is further than ever from being privatized. In the end, Tapia contends, the state-oil company has become an expression of the country’s “political temperament” and far removed from competitive market results.