by Michael T. Klare
The oil spill viewed from NASA’s Terra satellite on May 17.Photo: NASA’s Jeff Schmaltz, MODIS Rapid Response Team Cross-posted from TomDispatch.
Yes, the oil spewing up from the floor of the Gulf of
Mexico in staggering
quantities could prove one of the great ecological disasters of
human history. Think of it, though, as just the prelude to the Age of Tough
Oil, a time of ever increasing reliance on problematic,
hard-to-reach energy sources. Make no mistake: we’re entering the
danger zone. And brace yourself, the fate of the planet could be at
stake.
It may never be possible to pin down the precise cause of the massive
explosion that destroyed the Deepwater Horizon drilling rig on April
20, killing 11 of its 126 workers. Possible culprits include a faulty
cement plug in the undersea oil bore and a disabled cutoff device known
as a blow-out
preventer. Inadequate governmental oversight of safety procedures
undoubtedly also contributed to the disaster, which may have been set
off by a combination of defective equipment and human
error. But whether or not the immediate trigger of the explosion
is ever fully determined, there can be no mistaking the underlying
cause: a government-backed corporate drive to exploit oil and natural
gas reserves in extreme environments under increasingly hazardous
operating conditions.
The new oil rush and its dangers
The United States entered the hydrocarbon era with one of the world’s
largest pools of oil and natural gas. The exploitation of these
valuable and versatile commodities has long contributed to the nation’s
wealth and power, as well as to the profitability of giant energy firms
like BP and Exxon. In the process, however, most of our easily
accessible onshore oil and gas reservoirs have been depleted, leaving
only less accessible reserves in offshore areas, Alaska, and the melting
Arctic. To ensure a continued supply of hydrocarbons—and the
continued prosperity of the giant energy companies—successive
administrations have promoted the exploitation of these extreme energy
options with a striking disregard for the resulting dangers. By their
very nature, such efforts involve an ever increasing risk of human and
environmental catastrophe—something that has been far too little
acknowledged.
The hunt for oil and gas has always entailed a certain amount of
risk. After all, most energy reserves are trapped deep below the
Earth’s surface by overlying rock formations. When punctured by oil
drills, these are likely to erupt in an explosive release of
hydrocarbons, the well-known “gusher” effect. In the swashbuckling
early days of the oil industry, this phenomenon—familiar to us from
movies like There Will Be Blood—often caused human and
environmental injury. Over the years, however, the oil companies became
far more adept at anticipating such events and preventing harm to
workers or the surrounding countryside.
Now, in the rush to develop hard-to-reach reserves in Alaska, the
Arctic, and deep-offshore waters, we’re returning to a particularly
dangerous version of those swashbuckling days. As energy companies
encounter fresh and unexpected hazards, their existing technologies—
largely developed in more benign environments—often prove incapable
of responding adequately to the new challenges. And when disasters
occur, as is increasingly likely, the resulting environmental damage is
sure to prove exponentially more devastating than anything experienced
in the industrial annals of the nineteenth and early twentieth
centuries.
The Deepwater Horizon operation was characteristic of this trend. BP, the company which leased the rig and was overseeing the drilling
effort, has for some years been in a rush to extract oil from ever
greater depths in the Gulf of Mexico. The well in question, known as
Mississippi Canyon 252, was located in 5,000 feet of water, some 50
miles south of the Louisiana coastline; the well bore itself extended
another 13,000 feet into the earth. At depths this great, all work on
the ocean floor has to be performed by remotely-controlled robotic
devices overseen by technicians on the rig. There was little margin for
error to begin with, and no tolerance for the corner-cutting,
penny-pinching, and lax oversight that appears to have characterized the
Deepwater Horizon operation. Once predictable problems did arise, it
was, of course, impossible to send human troubleshooters one mile
beneath the ocean’s surface to assess the situation and devise a
solution.
Drilling in Alaska and the Arctic poses, if anything, even more
perilous challenges, given the extreme environmental and climatic
conditions to be dealt with. Any drilling rigs deployed offshore in,
say, Alaska’s Beaufort or Chukchi Seas must be hardened to withstand
collisions with floating sea ice, a perennial danger, and capable of
withstanding extreme temperatures and powerful storms. In addition, in
such hard-to-reach locations, BP-style oil spills, whether at sea or on
land, will be even more difficult to deal with than in the Gulf. In any
such situation, an uncontrolled oil flow is likely to prove lethal to
many species, endangered or otherwise, which have little tolerance for
environmental hazards.
The major energy firms insist that they have adopted ironclad
safeguards against such perils, but the disaster in the Gulf has already
made mockery of such claims, as does history. In 2006, for instance, a
poorly-maintained pipeline at a BP facility ruptured,
spewing 267,000 gallons of crude oil over Alaska’s North Slope in an
area frequented by migrating caribou. (Because the spill occurred in
winter, no caribou were present at the time and it was possible to scoop
up the oil from surrounding snow banks; had it occurred in summer, the
risk to the Caribou herds would have been substantial.)
If it’s oil, it’s okay
Despite obvious hazards and dangers, as well as inadequate safety
practices, a succession of administrations, including Barack Obama’s,
have backed corporate strategies strongly favoring the exploitation of
oil and gas reservoirs in the deep waters of the Gulf of Mexico and
other environmentally sensitive areas.
On the government’s side, this outlook was first fully articulated in
the National Energy Policy (NEP) adopted by President George W. Bush on
May 17, 2001. Led by former Halliburton CEO Vice President Dick
Cheney, the framers of the policy warned that the United States was
becoming ever more dependent on imported energy, thereby endangering
national security. They called for increased reliance on domestic
energy sources, especially oil and natural gas. “A primary goal of the
National Energy Policy is to add supply from diverse sources,” the
document declared. “This means domestic oil, gas, and coal.”
As the
NEP made clear, however, the United States was running out of
conventional, easily tapped reservoirs of oil and natural gas located on
land or in shallow coastal waters. “U.S. oil production is expected to
decline over the next two decades, [while] demand for natural gas will
most likely continue to outpace domestic production,” the document
noted. The only solution, it claimed, would be to increase exploitation
of unconventional energy reserves—oil and gas found in deep offshore
areas of the Gulf of Mexico, the Outer Continental Shelf, Alaska, and
the American Arctic, as well as in complex geological formations such as
shale oil and gas. “Producing oil and gas from geologically
challenging areas while protecting the environment is important
to Americans and to the future of our nation’s energy security,” the
policy affirmed. (The phrase in italics was evidently added by the
White House to counter charges—painfully accurate, as it turned out —that the administration was unmindful of the environmental
consequences of its energy policies.)
First and foremost among the NEP’s recommendations was the
development of the pristine Arctic National Wildlife Refuge, a proposal
that generated intense media interest and produced widespread opposition
from environmentalists. Equally significant, however, was its call for
increased exploration and drilling in the deep waters of the Gulf, as
well as the Beaufort and Chukchi Seas off northern Alaska.
While drilling in the Arctic National Wildlife Refuge was, in the
end, blocked by Congress, an oil rush to exploit the other areas
proceeded with little governmental opposition. In fact, as has now
become evident, the government’s deeply
corrupted regulatory arm, the Minerals Management Service (MMS),
has for years facilitated the awarding of leases for exploration and
drilling in the Gulf of Mexico while systematically ignoring environmental regulations and concerns. Common practice during the Bush
years, this was not altered when Barack Obama took over the
presidency. Indeed, he gave his own stamp of approval to a potentially
massive increase in offshore drilling when on March 30—three weeks
before the Deepwater Horizon disaster—he announced that vast areas of the Atlantic, the eastern Gulf of Mexico, and
Alaskan waters would be opened to oil and gas drilling for the first
time.
In addition to accelerating the development of the Gulf of Mexico,
while overruling government scientists and other officials who warned of
the dangers, the MMS also approved offshore drilling in the Chukchi and
Beaufort Seas. This happened despite strong opposition from
environmentalists and native peoples who fear a risk to whales and other
endangered species crucial to their way of life. In October, for
example, the MMS gave Shell Oil preliminary
approval to conduct exploratory drilling on two offshore blocks in
the Beaufort Sea. Opponents of the plan have warned that any oil spills
produced by such activities would pose a severe threat to endangered
animals, but these concerns were, as usual,
ignored. (On April 30, 10 days after the Gulf explosion, final
approval of the plan was suddenly ordered withheld by President Obama, pending a review of offshore drilling
activities.)
A BP hall of shame
The major energy firms have their own compelling reasons for a
growing involvement in the exploitation of extreme energy options. Each
year, to prevent the value of their shares from falling, these
companies must replace the oil extracted from their existing reservoirs
with new reserves. Most of the oil and gas basins in their traditional
areas of supply have, however, been depleted, while many promising
fields in the Middle East, Latin America, and the former Soviet Union
are now under the exclusive control of state-owned national oil
companies like Saudi Aramco, Mexico’s Pemex, and Venezuela’s PdVSA.
This leaves the private firms, widely known as international oil
companies (IOCs), with ever fewer areas in which to replenish their
supplies. They are now deeply involved in an ongoing oil rush in
sub-Saharan Africa, where most countries still allow some participation
by IOCs, but there they face dauntingly stiff competition from Chinese
companies and other state-backed companies. The only areas where they
still have a virtually free hand are the Arctic, the Gulf of Mexico, the
North Atlantic, and the North Sea. Not surprisingly, this is where
they are concentrating their efforts, whatever the dangers to us or to
the planet.
Take BP. Originally known as the Anglo-Persian Oil Company (later
the Anglo-Iranian Oil Company, still later British Petroleum), BP got
its start in southwestern Iran, where it once enjoyed a monopoly on the
production of crude petroleum. In 1951, its Iranian holdings were
nationalized by the democratic government of Mohammed Mossadeq. The
company returned to Iran in 1953, following a U.S.-backed coup that put
the Shah in power, and was finally expelled again in 1979 following the
Islamic Revolution. The company still retains a significant foothold in
oil-rich but unstable Nigeria, a former British colony, and in
Azerbaijan. However, since its takeover of Amoco (once the Standard Oil
Company of Indiana) in 1998, BP has concentrated its energies on the
exploitation of Alaskan reserves and tough-oil locations in the deep
waters of the Gulf of Mexico and off the African coast.
“Operating at the Energy Frontiers” is the title of BP’s Annual Review for 2009, which proudly began: “BP
operates at the frontiers of the energy industry. From deep beneath the
ocean to complex refining environments, from remote tropical islands to
next-generation biofuels—a revitalized BP is driving greater
efficiency, sustained momentum, and business growth.”
Within this mandate, moreover, the Gulf of Mexico held center stage. “BP is the leading operator in the Gulf of Mexico,” the review
asserted. “We are the biggest producer, the leading resource holder, and
have the largest exploration acreage position … With new discoveries,
successful start-ups, efficient operations, and a strong portfolio of
new projects, we are exceptionally well placed to sustain our success in
the deepwater Gulf of Mexico over the long run.”
Clearly, BP’s top executives believed that a rapid ramp-up in
production in the Gulf was essential to the company’s long-term
financial health (and indeed, only days after the Deepwater Horizon
explosion, the company announced that it had made $6.1
billion in profits in the first quarter of 2010 alone). To what
degree BP’s corporate culture contributed to the Deepwater Horizon
accident has yet to be determined. There is, however, some indication that the company was in an unseemly rush to complete the cementing of
the Mississippi Canyon 252 well—a procedure that would cap it until
the company was ready to undertake commercial extraction of the oil
stored below. It could then have moved the rig, rented from Transocean
Ltd. at $500,000 per day, to another prospective drill site in search of
yet more oil.
While BP may prove to be the principal villain in this case, other
large energy firms—egged on by the government and state officials—
are engaged in similar reckless drives to extract oil and natural gas
from extreme environmental locations. These companies and their
government backers insist that, with proper precautions, it is safe to
operate in these conditions, but the Deepwater Horizon incident shows
that the more extreme the environment, the more unlikely such statements
will prove accurate.
The Deepwater Horizon explosion, we assuredly will be told, was an
unfortunate fluke: a confluence of improper management and faulty
equipment. With tightened oversight, it will be said, such accidents
can be averted—and so it will be safe to go back into the
deep waters again and drill for oil a mile or more beneath the
ocean’s surface.
Don’t believe it. While poor oversight and faulty equipment may have
played a critical role in BP’s catastrophe in the Gulf, the ultimate
source of the disaster is big oil’s compulsive drive to compensate for
the decline in its conventional oil reserves by seeking supplies in
inherently hazardous areas—risks be damned.
So long as this compulsion prevails, more such disasters will
follow. Bet on it.
Related Links:
U.S. bans more Gulf fishing as oil fears grow for Florida
Obama’s ocean chief dismisses loop current threat: ‘Very little tarballs!’
10 ways MMS makes FEMA look good
Hotels listed below will have a special SLA rate, you will need to mention that you are an IEA member in town for the SLA when making your reservation. Discounted ISU housing (dorm rooms) will also be available with the SLA registration.
Not just yet.
