Ecuador has abandoned a conservation plan that would have paid the country not to drill for oil in the Amazon rainforest.

President Rafael Correa Thursday approved drilling in a part of Yasuni National Park that had previously been untouched by the oil industry.

The park is one of the most biodiverse areas in the world and the decision resulted in protests in Quito by environmentalists.

'It was not charity that we sought from the international community, but co-responsibility in the face of climate change.' —President Rafael Correa

But Correa said rich nations had failed to back the UN-backed initiative to pay the country not to drill, leaving Ecuador with no choice but go ahead with drilling.

In 2010, Ecuador launched a UN-backed scheme to attract donations to forego drilling in the east portion of the park with the aim of raising $3.6 billion US, about half the value of reserves in the park's Ishpingo-Tambococha-Tiputini oil field.

But in three years the initiative attracted only $13 million in actual donations. By the start of this year, the total of pledges from governments and individuals reached $300 million, according to its negotiators, but only a fraction of that amount was actually deposited in the trust.

UN-administered fund falls short

The fund, administered by the UN Development Program, was based on the theory that stopping the drilling would prevent more than 400 million tonnes of carbon dioxide from going into the atmosphere.

"The world has failed us," Correa said Thursday in a televised address. "I have signed the executive decree for the liquidation of the Yasuni-ITT trust fund and through it, end the initiative."

"It was not charity that we sought from the international community, but co-responsibility in the face of climate change," he added.

Yasuni National Park covers nearly 10,000 sq km and drilling has been allowed in parts of the park since the 1970s. In addition to its broad biodiversity, the rainforest is home to two threatened indigenous populations.

The Yasuni oilfields hold an estimated 846 million barrels of crude, 20 per cent of Ecuador's reserves. The decision announced Friday affects about one per cent of its area, President Correa said.

Environmentalists disappointed

Matt Finer, a scientist at the U.S.-based Center for International Environmental Law, expressed dismay at the decision.

"It is deeply disappointing that this alternative model for dealing with oil and gas reserves in mega diverse rainforests did not work," he said via email from Peru.

"The Yasuni-ITT Initiative was the lone exception to the relentless expansion of hydrocarbon projects deeper into the most remote tracts of the western Amazon. Now there is really no viable alternative to stop the wave of drilling slated for the most biodiverse region of the world."

The decision was a blow to environmental activists, who had hoped to protect part of the Amazon rainforest from development and pollution. It also stalls hopes that the Ecuador experiment could be a model to control climate change by offering other countries incentives to keep hydrocarbons in the ground.

Oil companies, including PetroEcuador which has drilling rights nearby, have been quietly preparing for the abandonment of the initiative by surveying and building roads to the area.

With files from the Associated Press