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Dirty oil

Written By: - Date published: 8:14 am, May 30th, 2010 - 38 comments
Categories: Conservation, energy, International - Tags: ,

I knew that disasters in rich white countries get much more media than disasters anywhere else. I knew that oil was a dirty business. None the less, this article by John Vidal surprised me:

The real cost of cheap oil
The Gulf disaster is only unusual for being so near the US. Elsewhere, Big Oil rarely cleans up its mess

Big Oil is holding its breath. BP’s shares are in steep decline after the debacle in the Gulf of Mexico. Barack Obama, the American people and the global environmental community are outraged, and now the company stands to lose the rights to drill for oil in the Arctic and other ecologically sensitive places.

The gulf disaster may cost it a few billion dollars, but so what? When annual profits for a company often run to tens of billions, the cost of laying 5,000 miles of booms, or spraying millions of gallons of dispersants and settling 100,000 court cases is not much more than missing a few months’ production. It’s awkward, but it can easily be passed on. … But the oil companies are nervous now because the spotlight has been turned on their cavalier attitude to pollution and on the sheer incompetence of an industry that is used to calling the shots.

Big Oil’s real horror was not the spillage, which was common enough, but because it happened so close to the US. Millions of barrels of oil are spilled, jettisoned or wasted every year without much attention being paid.

If this accident had occurred in a developing country, say off the west coast of Africa or Indonesia, BP could probably have avoided all publicity and escaped starting a clean-up for many months. … Big Oil is usually a poor country’s most powerful industry, and is generally allowed to act like a parallel government. In many countries it simply pays off the judges, the community leaders, the lawmakers and the ministers, and it expects environmentalists and local people to be powerless. Mostly it gets away with it.

What the industry dreads more than anything else is being made fully accountable to developing countries for the mess it has made and the oil it has spilt in the forests, creeks, seas and deserts of the world.

There are more than 2,000 major spillage sites in the Niger delta that have never been cleaned up; there are vast areas of the Colombian, Ecuadorian and Peruvian Amazon that have been devastated by spillages, the dumping of toxic materials and blowouts. Rivers and wells in Venezuela, Angola, Chad, Gabon, Equatorial Guinea, Uganda and Sudan have been badly polluted. Occidental, BP, Chevron, Shell and most other oil companies together face hundreds of outstanding lawsuits. Ecuador alone is seeking $30bn from Texaco.

The only reason oil costs $70-$100 a barrel today, and not $200, is because the industry has managed to pass on the real costs of extracting the oil. If the developing world applied the same pressure on the companies as Obama and the US senators are now doing, and if the industry were forced to really clean up the myriad messes it causes, the price would jump and the switch to clean energy would be swift.

In an ideal world we could do it. Using the leverage of this environmental disaster in America’s back yard, the world could force through changes that would make the industry accountable. Oil prices would rise, consumption would fall, we would make the transition to renewable energy, our climate change crisis would ease. But the economic turmoil would be immense, so it will never happen. In the real world we the people will always choose catastrophe tomorrow over pain today.

[Update: Oh shit: BP’s top kill effort fails to plug Gulf oil leak. It just gets worse and worse.

Also – The Guardian has another piece on the Nigerian spills].

38 comments on “Dirty oil ”

  1. tc 1

    Oil’s been at the centre of many conflicts as we have a world, that as ROB says, can’t face the economic impact so doesn’t and the issue grows larger each cycle as we consume more of a dwindling resource.

    Which makes our own efforts to being as sustainable and less oil reliant in this part of the world so important. Also that we maximise any oil/gas royalties for NZ benefit that these powerful wealthy and well connected oil entities are after. We are but a speck in the big oil picture so we need to both get away from it and make whatever we have work for us…. this’s going to get very very ugly going forward globally, wait till Big oil starts eyeing up our southern basin seriously.

    • uke 1.1

      Yeah I notice the NZ MSM hasn’t really got the angle yet, the comparison with the NZ Southern Basin.

      If drilling in the Gulf of Mexico had its hazards – think what oil extraction will be like in the roaring forties of the southern ocean.

  2. ghostwhowalksnz 2

    Big Oil was acting like a parallel government …in the US

    For a while they had two oil men in the White house , Cheney and Bush and they WERE the government

  3. mach1 3

    For around $500k the gulf spill could have been avoided, thanks Dick.

    • felix 3.1

      But, you know, red tape. Over-regulation. Nanny state. Safety wowsers. Ruining all our fun. Telling us what to think. Market knows best, after all.

      • ianmac 3.1.1

        A chilling clip thanks Mach 1. It is interesting that Cheney/Halliburton link – again! (The deregulation also abandoned the water pollution rules in the USA. eg The massive pig farms can now allow their effluent to overflow into rivers killing life and destroying water supplies. Freely. Same thing.)

  4. mach1 4

    BP’s Gulf of Mexico drilling was exempted from an environmental impact study, nice.

  5. Bill 5

    A few years ago I watched a video of some well meaning young activists who descended on the house the then CEO of BP located some quiet and quaint little hamlet in the SE England. From memory, they were chanting and bannering about the activities in the Niger Delta. Well, out comes Mr CEO looking quite reasonable and even a little grandfatherly. He engages with the activists very politely and before you know it his wife has appeared with cups of tea and biscuits and all and sundry are sitting on a quaint English lawn having a civilised cuppa where Mr CEO impresses upon the activists that he is really quite a nice guy ( Would you care for another biscuit? – ah, yes. They’re my favourite too!) and so could not possibly be held accountable or responsible for the stuff happening in the Niger Delta ( Yes, yes. A terrible situation. A tragedy, don’t you think? But what can one do? I think you are a wonderful example of how deeply people care. I care too. But my hands are tied.) by any reasonable, right thinking people.

    Eventually the activists left, a little confused and possibly crestfallen, waving a cheerio to the nice man and his wife on the lawn.

    And what the activists missed was that evil is banal, that it does not come wrapped up with snarls, blackened finger nails and hunch backs…that it simply, merely follows the rules. So if the Ogoni’s were being murdered, it was because the rules and legislations determined such a conclusion to the situation in the Delta. Which was lamentable, but there you go.

    No one person or group of people could reasonably be held to blame. It had nothing to do with pressures being brought to bear on the government by BP. It had nothing to do with armed militia or the army being armed by and paid by either BP or as a direct result of their operations in the region….and so on. It was simply an unfortunate consequence of the way things were.

    Just like the oil spill in the Gulf. It’s an unfortunate consequence of the way things are.

    And if the government was weaker and the accountability less or non-existent. That would just be a consequence of the way things were.

    And if there were armed militias scooting around the rigs harassing and sometimes killing local fishermen who ventured too close, then that would just be a consequence of the way things were.

    And so it goes.

    And never is ‘the way things are’ anything that BP or any BP personnel deliberately brought into being. They merely follow the rules, tick the boxes and petition for changes to the rules where they feel such a thing would be good for business. Unbusiness like consequences of all this are just, well…unfortunate.

    Now. Cup of tea, anyone? Long straw?

    • felix 5.1

      I think the grandfatherly CEO chap was from Shell.

      But yes.

      • Bill 5.1.1

        Yup. You’re probably right.

        From memory it was part of a quite enlightening wee series. I seem to remember some decidedly middle class English types taking direct action against a marshalling yard or some such. The poor wee PC Plod was all quite flustered and lost at being disobeyed and firmly defied by a kindly wee tweed, woolly hat and hush puppies trespasser.

        Which is why the middle classes….and in particular those who look middle class…need to be part and parcel of demo’s and protest. It throws the so-called public servant way off balance when they are confronted by a personage conforming to the image they hold in their head of their ‘natural’ master…the actual public they serve to serve as it were.

    • Draco T Bastard 5.2

      Manufacturing Consent or The Corporation

      One of the two but both are worth watching though.

    • ianmac 5.3

      You mean friendly, smiling, chap with a cute little wave? Dishonest CEOs can be like hat can’t they!

  6. Draco T Bastard 6

    In the real world we the people will always choose catastrophe tomorrow over pain today.

    That does seem to be the case. Take the ETS and how many people are saying that by implementing it it’s going to cost us more to live. People are struggling to live so making things cost more is going to be a problem but not paying the extra costs isn’t going to make them go away. Of course, the people struggling to live should be paid more from the businesses that are using them to make a few people rich but we won’t hear that. What we get instead is the PM telling us how necessary the rich are and that we should make them richer – even though they’re actually worthless.

    In the real world, “the people” aren’t given much of a choice.

  7. RedLogix 7

    In the real world we the people will always choose catastrophe tomorrow over pain today.

    Otherwise known as short-term thinking. The reason why people choose reward now over bigger reward later is simple… the reward now is far more certain than reward later. In unequal, unjust societies people become accustomed to having the rug pulled out from under their plans and therefore quite rationally adjust their behaviour to suit.

    While it is well known that the most successful people are those who make long-term plans and are capable of delayed gratification…what these studies never capture are all those people who also made long-term plans but never got to the pay-off because some other untrustworthy bastard stole it off them along the way.

    The more unequal a society becomes the less likely people will agree with the statement “Most people can be trusted.” A belief that corrodes the very foundation of all human society.

    • Bill 7.1

      “Otherwise known as short-term thinking.”

      I think that is something else you are referring to when a small positive now is taken in lieu of a bigger positive later.

      What the post is referring to, I would see as being more akin to ‘Hanging on for Grim Death’ than ‘short term thinking’…’n fact I don’t reckon there’s too much of any thinking involved at all.

      It’s like not letting go ’cause the water you’ll drop into is deep and you reckon it’ll be incredibly cold and you might drown or bang your head or whatever. Whereas, it’s quite warm hanging out here in the sun off the edge of a cliff by your fingernails. And yes you know that the guy swinging the machete will chop off your fingers…at which point you’ll fall into the cold, deep water with the added bonus of missing fingers, immense pain and no way of clawing your way back out. But for now, at least it’s warm out here in the sun…

  8. r0b 8

    See post update: BP’s top kill effort fails to plug Gulf oil leak. The gulf is totally screwed.

    • infused 8.1

      It was never going to work. The only solution that is going to fix this, which should have been done in the first place, is nuke it. You can cry all you want about the fall out of this, but atleast it’s most probably going to fix the issue. There’s been over 30 days now of oil gushing out… I don’t know what’s worse, the oil effect or the nuke effect.

      • Anita 8.1.1

        How would a nuke solve this?

        • infused

          Use your brain. The pressure is to great to cap it. The only reason they are trying to cap it so they can get the oil from it.

          • Anita

            I did use my brain, but I don’t know enough about the physics of either nuclear blasts or oil wells to figure it out.

            I thought maybe the point was that the nuke would melt the rock and seal the well, but then I wasn’t sure how that would work as the molten rock might be too small a plug and why wouldn’t it cause radiating fractures the oil could pass along.

            Then I thought maybe it was to fracture the rocks on the sides of the well so that they would fall inwards and block the well, but then I thought the pressure might simply flush back out the broken rock leaving a wider well.

            So, seriously, how would it work?

            P.S. Before you say something about using google, I did search and I only found people saying it had worked in the USSR on a number of occasions, but no explanation of the physics beyond handy phrases like “moves the rocks” and “squeeze the channel” and “fuse the leak”.

  9. ianmac 9

    It might be a bit naive but since they are talking about huge tanker sized volumes and since the oil floats on water, would it be feasible to suck up the oil and tanker it to land where the oil can be recovered and sold? (Salvager’s rights to ownership of course. There are dredges which suck. There is the technology for recovering oil from impurities.)

    Or are the volumes of oil just too vast?

    • Pascal's bookie 9.1

      A lot of it isn’t on the surface. BP have been pumping enormous amounts of dispersants into the leak, which are themselves toxic and not fully tested.

      There are also several underwater plumes…


      It’s pretty unrelentingly awful.

    • r0b 9.2

      Not really my area, but my guess is it could be possible in principle, but is not “economic”. Mostly because of the huge surface area – might burn as much fuel collecting the surface oil as the oil you collect. And not all the oil is on the surface, a lot of it is in huge underwater “plumes” being carried far off by deep currents”.

    • Bill 9.3

      The MSNBC link I put up yesterday has these guys… “Matt Simmons was an energy adviser to George W. Bush, is an adviser to the Oil Depletion Analysis Centre, and is a member of the National Petroleum Council and the Council on Foreign Relations. Simmon is chairman and CEO of Simmons & Company International, an investment bank catering to oil companies.”…discussing just that. Using tankers and supertankers in sort of the same way as a human bucket chain for bailing…including the plumes.

      They can’t understand why it hasn’t been done. Or why BP are concentrating their energies on a riser pipe that cannot conceivably be the source of the oil spilling into the Gulf.

  10. ianmac 10

    Well bugger me. I feel quite chuffed that it may be possible. As for uneconomic, the cost to not do something would be a catastrophe!

  11. infused 12

    I’ve said right from the beginning, this pipe was something else. Only Russia have ever drilled so deep. Bp have hit a reserve with preassure they cannot contain. There is no technology that can cap this thing.

    The reason BP are stalling is they still want to get a profit from the oil. hence the releif pipe and wanting to contain it.

    I put $100 they won’t stop this without a nuke exploding down there.

  12. Bill 13

    And when your msm isn’t part of the dominant msm you get genuinely informative pieces like this sneaking through.


    • r0b 13.1

      That is a good read.

      The media scene in NZ is so depressing. The only independent newspaper (as I understand it) is the Otago Daily Times, and for my money the best broadcaster is RNZ. After that – what is there?

  13. mach1 15

    infused could well be on the money with the nuke thing, it worked for the Soviets but not without serious consequences


  14. crib 16


    Kind of sums up the whole it’s not a 1st world country so who gives a shit attitude

    This was posted as a response to one of Trevor Mallars wall posts on facebook

    “Trevor Mallard is glad the super fund bought Shell not BP.”

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