Firm dealing

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Following widespread violent protests, on August 25, 2005, energy companies signed a deal with Ecuador's poor communities, promising to invest more money for the latter's benefit. In return, the agitationists, who attacked oil wells and other industry establishments in a weeklong protest, agreed to end their interventions. Ecuador is South America's biggest oil supplier to the US after Venezuela and was earlier a member of the Organisation of the Petroleum Exporting Countries.

Communities living near oil wells in eastern Ecuador complain that they get very little benefits from the industry's environment-unfriendly operations. "This marks an important point in which, for the first time, we got the attention of the oil companies and persuaded them to do something,' Edmundo Espindola, mayor of the oil town of Shushufindi in Sucumbios, was quoted as saying. Under the new deal, oil companies, including Occidental Petroleum Corp, Petrobras and EnCana Corp, will pave 260 kilometres of new roads in the Amazon provinces of Sucumbios and Orellana. Also, about two-thirds of the 25 per cent income tax paid by them will be used for health, environment and development projects for local people.