Category Archives: oil
Laugh with the Koch brothers
“Our vision controls the way we think and, therefore, the way we act … the vision we have of our jobs determines what we do and the opportunities we see or don’t see.”
“The Koch brothers job is to do everything they can to dismember government in general,” Senator Bernie Sanders
here are 10 facts that every American should know about who the Kochs are and what they’re doing to the USA.
1. Koch Industries, which the brothers own, is one of the top ten polluters in the United States — which perhaps explains why the Kochs have given $60 million to climate denial groups between 1997 and 2010.
2. The Kochs are the oil and gas industry’s biggest donors to the congressional committee with oversight of the hazardous Keystone XL oil pipeline. They and their employees gave more than $300,000 to members of the House Energy and Commerce Committee in 2010 alone.
3. From 1998-2008, Koch-controlled foundations gave more than $196 million to organizations that favor polices that would financially enrich the two brothers. In addition, Koch Industries spent $50 million on lobbying and some $8 million in PAC contributions.
4. The Koch fortune has its origins in engineering contracts with Joseph Stalin’s Soviet Union.
5. The Kochs are suing to take over the Cato Institute, which has accused the Kochs of attempting to destroy the group’s identity as an independent, libertarian think and align it more closely with a partisan agenda.
6. A Huffington Post source who was at a three-day retreat of conservative billionaires said the Koch brothers pledged to donate $60 million to defeat President Obama in 2012 and produce pledges of $40 million more from others at the retreat.
7. Since 2000, the Kochs have collected almost $100 million in government contracts, mostly from the Department of Defense.
8. Koch Industries has an annual production capacity of 2.2 billion pounds of the carcinogen formaldehyde. The company has worked to keep it from being classified as a carcinogen even though David Koch is a prostate cancer survivor.
9. The Koch brothers’ combined fortune of roughly $50 billion is exceeded only by that of Bill Gates in the United States.
10. The Senate Select Committee on Indian Affairs accused Koch Oil of scheming to steal $31 million of crude oil from Native Americans. Although the company claimed it was accidental, a former executive in this operation said Charles Koch had known about it and had responded to the overages by saying, “I want my fair share, and that’s all of it.”
That last quote — “I want my fair share, and that’s all of it” — encapsulates the unbridled greed driving the Kochs’ political activism and business dealings. Democracy cannot thrive with so much power being in the hands of men like this. If we care about democracy, we have to work to take it back.
It has now been a decade since the United States invaded Iraq, and the country’s beleaguered capital isn’t faring so well
after 10 years of conflict. In 2012, for instance, Baghdad topped Mercer’s list as the worst place to live based on quality of
life, edging out other war-torn heavy hitters like Khartoum, Sudan and Brazzaville, Congo. The city has even become a
synonym for chaos and destruction; when Hurricane Katrina ravaged New Orleans in 2005, headlines such as “Baghdad
on the Bayou” and “Looters turn New Orleans into ‘Downtown Baghdad'” quickly surfaced.
But the city, nestled on the banks of the storied Tigris River, was not always associated with violence and decline. In 1932,
Iraq had just gained independence after more than ten years as a British mandate and centuries under Ottoman rule.
Baghdad, famed at the time for its quaint blend of Turkish architecture and ancient markets, suddenly found itself the
capital of a fledgling Iraqi nation. The ethnic and religious tensions that would ignite in the coming decades of war and
sanctions were already present but not yet explosive, and the vast oil reserves that would transform the capital into a
booming metropolis had only just been discovered. These 1932 photographs, drawn from the Matson Collection at the
Library of Congress, show a Baghdad on the brink of a new era, struggling to discover its identity in a time before it was
defined by devastation.
Above, pedestrians walk along the street in front of the Midan mosque.
King Faisal I (left), who ruled Iraq from 1921 to 1933, sits next to his brother, Emir Abdullah of Transjordan, during a lawn
party at the royal palace in Baghdad. The Saudi-born king was a favorite of the British during the mandate period, and
many Iraqis were suspicious of his pro-Western sentiments. An Arab Sunni, his reign also prompted unrest among
Assyrian, Kurdish, and Shiite minorities, which he vigorously suppressed.
Fires caused by the escape of natural gas blaze near the Iraq Petroleum Company’s oil wells in the Kirkuk District.
Beginning with the first discovery of oil in Persia in 1908, foreign powers eyed the region with interest, and international
competition over Iraq’s potential oil reserves played a role in determining its borders in the wake of World War I, as the
British and French both sought access. The controversy surrounding the U.S. invasion of Iraq in 2003 underscored the
continued foreign interest in this vital natural resource. As Peter Maas recounted in Foreign Policy, U.S. troops secured
the Iraqi oil ministry in Baghdad as the rest of the city was left to looters, prompting one Iraqi to tell him, “It is all about
Library of Congress
Iraqi army officers celebrate the country’s induction into the League of Nations at the Royal Palace in Baghdad. In 1932,
Iraq became the first former mandate to join the League after gaining independence. The mandate had gotten off to an
inauspicious start in 1920, when the British determined the borders of Iraq based more on geopolitical interests than
regional logic, and a bloody rebellion against British occupation followed.
Using language that some have read as a foreshadowing of the U.S. military’s quagmire following the 2003 invasion, the
British Orientalist T.E. Lawrence described the unrest. “The people of England have been led in Mesopotamia into a trap
into which it will be hard to escape with dignity and honor,” he wrote. “Things have been far worse than we have been told,
our administration more bloody and inefficient than the public knows. It’s a disgrace to our imperial record and may soon
be too inflamed for any ordinary cure. We are today not far from a disaster
Pedestrians walk on a bridge over the Tigris River, which snakes through Baghdad and divides the city. The Tigris and
Euphrates rivers help make up the Fertile Crescent and provide a vital source of life in an otherwise arid region. But years
of pollution and war have taken their toll. Upon visiting Baghdad in 2004, one New York Times reporter described the
Tigris as “a smelly, shrunken, deserted, refuse-strewn ghost of its former splendor.”
Men walk the street after crossing Baghdad’s Katah Bridge.
Young boys sit in watermelon barges banked on the Tigris River. Iraq possesses a unique breed of watermelon that is
capable of growing up to 50 pounds in the fertile land around the Tigris. Still an important agricultural product, the fruit
has long provided an alternative source of hydration for those who want to avoid unclean drinking water. During the Iraq
war, USA Today reported on the peril faced by merchants while transporting watermelon — by truck rather than barge –
– to Baghdad.
Library of Congress
Men wearing the Turkish fez and suits walk alongside those in more typical Iraqi dress while carriages pass by on a newly
constructed street. Baghdad’s mandate period was characterized by the melding of the modern with the traditional. But it
wasn’t until the nationalization of oil in the 1960s and 70s that the country saw modernization on a vast scale, as a
construction boom transformed Baghdad into a thriving metropolis.
Copper workers use traditional wooden horses as they hammer at the metal. Baghdad’s Safafeer market has been home to
copper merchants and craftsmen for hundreds of years. Only recently has the business faced serious decline thanks to
increasing imports of factory-made goods combined with a lack of tourism. The market, made famous by its rich copper
history, now sells mostly clothing
Tea sellers smile after serving a customer at a typical railroad tea stand in Ur.
Shoe sellers line one of Baghdad’s many markets. The city’s famed bazaars have attracted visitors for centuries, though
more recently they have also gained notoriety as the targets of bombings.
A street barber at work in Baghdad.
An older man instructs a young boy at the Haidar Khana Mosque. This mosque, constructed during Ottoman rule in
1832, is a popular Shiite place of worship. In March 2007 it was partially damaged by a bombing in eastern Baghdad,
where the city’s Shiite population is largely concentrated
People gather along the bank of the Tigris River, with Baghdad’s old city walls in the distance. The city’s location along the
river historically enabled it to thrive as a center of commerce and ideas. In the monarchy’s early days, and even in the years
of instability following Faisal’s rule, Baghdad fostered a great deal of intellectual exchange. But under the rule of Saddam
Hussein, intellectual life stagnated due to censorship, which drove much of the publishing industry underground.
More recently, the country has suffered from brain drain as skilled workers fled the violence that accompanied the U.S.
A freshly tarred gufa floats on the banks of the Tigris. The round boats, which were made from reeds caulked with asphalt
and capable of transporting up to 20 passengers, were commonly used for river travel in Baghdad until the 1970s.
The Iraq Museum displayed a wide array of artifacts from the ancient civilizations of Mesopotamia. Built by famed British
Orientalist Gertrude Bell in 1926, it housed the findings of U.S. and European archaeologists who conducted ambitious
excavations in the aftermath of World War I. The museum was looted during the U.S. invasion in 2003, prompting two
senior cultural advisors to the Bush administration to resign in protest. One of them, Gary Vikan, lamented, “if we
understood the value of Sumerian cuneiform tablets to our past, as we do with oil getting us somewhere in our cars, I don’t
think this would have happened.”
Women walk in front of the Royal College of Medicine, which was founded in Baghdad in 1927. One of the first medical
schools in the Middle East, it still exists today as part of the University of Baghdad.
Goods are unloaded and carried by donkeys on their way to Baghdad’s markets. King Faisal attempted to modernize Iraq’s
economy by building roads and beginning construction on an oil pipeline to the Mediterranean, but the economy
remained centered around the exchange of agricultural goods during his reign. The nationalization of petroleum in the
1960s and 70s, fueled a commercial boom in Baghdad, but the growth was shortlived. The Iran-Iraq war (1980-1988) left
Iraq $80 million in debt to its Gulf neighbors, and Saddam Hussein’s invasion of Kuwait in 1990 drove the country further
into debt by setting off a series of crippling international sanctions
Rabbis stand in front of Ezekiel’s tomb, a Jewish shrine and pilgrimage site located in Kifl. In the 1930s, Iraq’s Jewish
population, one of the oldest in the world, exceeded 120,000, and Hebrew was listed among the country’s six languages.
But after the creation of Israel in 1948, Iraq’s Jews faced increasing persecution and pressure to leave. Today, Baghdad’s
Jews have “all but vanished.”
“Basket boys” carry unwanted sand from a highway construction site in Baghdad. While Iraq might be “10 parts sand to
1 part water,” the sand’s quality is not great for construction: Writing for the New York Times’ At War blog in 2010,
Stephen Farrel noted how U.S. troops had to ship “more resilient desert” from other parts of the Middle East for their blast
Library of Congress
People stand in the old Turkish Qualla’a, a citadel, in Baghdad. The city was conquered by Ottoman Turks in 1534 and
remained under Ottoman rule until the British established the Kingdom of Iraq in 1921.
A Baghdad cityscape in 1932. For some, even when this picture was taken, the glory days of Baghdad had long passed. In
fact, narratives of decline have surrounded the city since the 13th century, when it was the center of medieval Islamic
intellectual life. When the British painter Tristram J. Ellis stopped in Baghdad as part of his travels in the early 1900s, for
instance, his artist’s eye found it wanting. “All those who are acquainted with the past history of Baghdad, and the glowing
descriptions of its buildings and streets in the time of the Caliphs, will think the present city very mean, and it is so,
compared with almost any other great Oriental city,” he wrote.
In the century since he wrote these words, Baghdad has persevered through decades of invasion, dictatorship, and war.
Today, as reconstruction efforts flounder and sectarian violence plagues the capital, it again finds itself labeled as a
place to avoid. But for the more than 7 million people who live there, this enduring city on the Tigris remains home.
In the aftermath of the First World War, Britain and France famously created the modern Middle East by carving up what had been the Ottoman Empire. The borders of new states such as Iraq and Syria were determined in keeping with British and French needs and interests. The wishes of local inhabitants were largely ignored.
Now, for the first time in over 90 years, the whole postwar settlement in the region is coming unstuck. External frontiers are no longer the impassable barriers they were until recently, while internal dividing lines are becoming as complicated to cross as international frontiers.
In Syria, the government no longer controls many crossing points into Turkey and Iraq. Syrian rebels advance and retreat without hindrance across their country’s international borders, while Shia and Sunni fighters from Lebanon increasingly fight on opposing sides in Syria. The Israelis bomb Syria at will. Of course, the movements of guerrilla bands in the midst of a civil war do not necessarily mean that the state is finally disintegrating. But the permeability of its borders suggests that whoever comes out as the winner of the Syrian civil war will rule a weak state scarcely capable of defending itself.
The same process is at work in Iraq. The so-called trigger line dividing Kurdish-controlled territory in the north from the rest of Iraq is more and more like a frontier defended on both sides by armed force. Baghdad infuriated the Kurds last year by setting up the Dijla (Tigris) Operations Command, which threatened to enforce central military control over areas disputed between Kurds and Arabs.
Dividing lines got more complicated in Iraq after the Hawaijah massacre on 23 April left at least 44 Sunni Arab protesters dead. This came after four months of massive but peaceful Sunni protests against discrimination and persecution. The result of this ever-deeper rift between the Sunni and the Shia-dominated government in Baghdad is that Iraqi troops in Sunni-majority areas behave like an occupation army. At night, they abandon isolated outposts so they can concentrate forces in defensible positions. Iraqi government control in the northern half of the country is becoming ever more tenuous.
Does it really matter to the rest of the world who fights whom in the impoverished country towns of the Syrian interior or in the plains and mountains of Kurdistan? The lesson of the last few thousand years is that it matters a great deal. The region between Syria’s Mediterranean coast and the western frontier of Iran has traditionally been a zone where empires collide. Maps of the area are littered with the names of battlefields where Romans fought against Parthians, Ottomans against Safavids, and British against Turks.
It is interesting but chilling to see the carelessness with which the British and French divided up this area under the Sykes-Picot Agreement of 1916. The British were to control the provinces of Baghdad and Basra and have influence further north. The French were to hold south-east Turkey and northern Syria and the province of Mosul, believed to contain oil. It turned out, however, that British generosity over Mosul was due to Britain having promised eastern Turkey to Tsarist Russia and thinking it would be useful to have a French cordon sanitaire between themselves and the Russian army.
Sykes-Picot reflected wartime priorities and was never implemented as such. The British promise to give Mosul to France became void with the Bolshevik revolution in 1917 and the Bolsheviks’ unsporting publication of Russia’s secret agreements with its former French and British allies. But in negotiations in 1918-19 leading up to the Treaty of Versailles, only the most perfunctory attention was given to the long-term effect of the distribution of the spoils.
Discussing Mesopotamia and Palestine with David Lloyd George, Georges Clemenceau, the French Prime Minister, who was not very interested in the Middle East, said: “Tell me what you want.” Lloyd George: “I want Mosul.” Clemenceau: “You shall have it. Anything else?” Lloyd George: “Yes, I want Jerusalem too.” Clemenceau agreed with alacrity to this as well, though he warned there might be trouble over Mosul, which even then was suspected to contain oil.
Those negotiations have a fascination because so many of the issues supposedly settled then are still in dispute. Worse, agreements reached then laid the basis for so many future disputes and wars that still continue, or are yet to come. Arguments made at that time are still being made.
Not surprisingly, the leaders of the 30 million Kurds are the most jubilant at the discrediting of agreements of which they, along with the Palestinians, were to be the greatest victims. After being divided between Iraq, Turkey, Iran and Syria, they sense their moment has finally come. In Iraq, they enjoy autonomy close to independence, and in Syria they have seized control of their own towns and villages. In Turkey, as the PKK Turkish Kurd guerrillas begin to trek back to the Qandil mountains in northern Iraq under a peace deal, the Kurds have shown that, in 30 years of war, the Turkish state has failed to crush them.
But as the 20th century settlement of the Middle East collapses, the outcome is unlikely to be peace and prosperity. It is easy to see what is wrong with the governments in present-day Iraq and Syria, but not what would replace them. Look at the almost unanimous applause among foreign politicians and media at the fall of Colonel Gaddafi in 2011, then look at Libya now, its government permanently besieged or on the run from militia gunmen.
If President Bashar al-Assad did fall in Syria, who would replace him? Does anybody really think that peace would automatically follow? Is it not far more likely that there would be continued and even intensified war, as happened in Iraq after the fall of Saddam Hussein in 2003? The Syrian rebels and their supporters downplay the similarities between the crises in Iraq and Syria, but they have ominous similarities. Saddam may have been unpopular in Iraq, but those who supported him or worked for him could not be excluded from power and turned into second-class citizens without a fight.
US, British and French recipes for Syria’s future seem as fraught with potential for disaster as their plans in 1916 or 2003. In saying that Assad can play no role in a future Syrian government, the US Secretary of State, John Kerry, speaks of the leader of a government that has still only lost one provincial capital to the rebels. Such terms can only be imposed on the defeated or those near defeat. This will only happen in Syria if Western powers intervene militarily on behalf of the insurgents,
Tomorrow once upon a time in Baghdad
What’s going on with Ireland’s natural resources? Many people believe that our government have given our oil away, and that ownership and control of the oil belongs completely to the various oil companies. Have our government really given it away? There’s so much speculation and spin around the whole topic – no one seems to be able to give a clear assessment of the situation. When confronted, politicians do what they do best – avoid answering questions. Isn’t it time we had some transparency?
On a recent trip to Oslo, I spoke with an engineer who worked on the first oil finds in Norway. Before Norway began producing their own oil, it was a poor country which mainly produced timber and fish. The illusion that the Norwegians initially knew how to produce oil needs to be smashed. There is a distinction between a drilling/exploration licence and a licence to extract/produce. When Royal Dutch Shell declared itself capable of producing oil in the North Sea, the Norwegian government said “great, now it’s a joint venture”. Essentially, they said “this is Norwegian oil and if you’re going to take it out of our territory – it is going to be a joint venture – we’re in.”
Norway didn’t become a wealthy country overnight. When the oil industry was in its infancy in Norwegian waters back in the 1970s, the Norwegians paid dearly; people don’t work for free. For example, each barrel worth $109, Shell say “we want $87 of that because we need to recover our huge investment.” This is where government need to be strong in their negotiations and get the best deal for the state. The Norwegians learned quickly and invested heavily in education and over time have become leading experts in oil exploration and production. Where did they attain this knowledge?
In the 1970s, engineering professionals from the Gulf of Mexico (the birthplace of off-shore drilling) and Britain came to Norway with their expertise. It wasn’t long before Shell and other companies were in the North Sea. The Norwegians participated; they watched and learned the techniques of the industry and since the 1980s have been exploring and producing around the globe with their own company, Statoil. Their main political objective has been to ensure that the values on the Norwegian Continental Shelf (NCS) benefit the entire country.
It appears that a country would be better off to put out contracts to drill and extract the oil out to tender; however, the industry is not structured this way. Off-shore oil production by its nature is very costly because the crude oil extracted has to be refined. To save on transportation costs, the oil company builds a platform to refine the oil at sea. It takes three years and costs billions to complete this project. Once the oil is refined, it can then be piped to the mainland or more favourably into huge tankers, which can then be shipped across the globe to the highest bidder.
Who makes the lion’s share of the profits? Of course, the company who makes the biggest investment into the research, scientific work, development, drilling, production, and when they get the oil up and out of the sea bed, the share that the country gets depends on the contract made between the oil companies and the government of the country. Shell is a company who often invests 100% of the costs of exploration and then leases out drilling rights to companies who come in and produce. Shell and the government negotiate the terms. The Irish government appear to be gravely inept at bargaining with multinationals. One only has to look at the IFSC and the minuscule rate of tax they pay the state. Why don’t we demand more?
If we want to emulate the Norwegians success, we must be willing to invest wisely in ascertaining the necessary knowledge and educating professionals in the field thus creating our own company, which we could appropriately name, Emerald Oil. However, this will be impossible for us to do because we are paying billions of euros to unsecured bondholders in Europe, and to our International bailout masters.
The International Monetary Fund (IMF) has given us a bailout package along with European financial institutions. The IMF has a reputation for being repaid through the sale of a country’s natural resources; asset stripping is their forte. Their ability to manufacture and offload massive debt onto countries, and then take control of their state assets has been fine-tuned over the last 50 years, from Latin America to Africa to Asia. Our energy reserves alone are worth potentially trillions and anything else is a bonus for them. They succeed via complicit government and elite that is thrown a few bones to keep them accustomed to the life they live. What they don’t like is a well-informed, educated public, capable of engaging in critical thinking. Let us be critical, vocal, resolute and disobedient, and demand more.
One hates to be pessimistic, but it looks like we’ve been set up and are about to be completely robbed of our natural assets. Wouldn’t we be better off to leave our oil in the ground until we’re ready to profit from it? The IMF and co are expecting to be repaid with the sale of Ireland’s forests, cheap oil, and cash payments in the form of further cuts in public spending. Austerity doesn’t work; it has never worked anywhere, ever. We should have already repudiated this toxic debt, which is not ours, and left the euro. Only then can we create better opportunities for future generations on this abused island. Support the campaign to Own Our Oil http://www.ownouroil.ie.
There is still plenty of ire left in Ireland as campaigners ready themselves for another summer of action against Shell and their plans to despoil the coast of County Mayo with a new gas pipeline. The project is already a decade late and three times over budget; pretty impressive for a small community fighting one of the biggest multinationals in the world.
However three times over budget suggest a hell of a lot of drinking by Jesus lads the Garda drinks delivery system is believed to have run up an massive overtime bill and you will pay for it once again.
Nick Flores is an economist who knows the oil-and-gas industry from the inside, having been in the merchant marines hauling platforms and rigs to sundry locations in the Gulf. Industry exposure didn’t end there; he was in grad school six months after the Exxon Valdez sullied the Arctic shore and studied first-hand the economics of accidents. He was not dismayed. In his words, “Shale gas is a revolution. It has transformed energy in America. What we’re seeing now is but the tip of the iceberg.” He didn’t say from which dwindling sheet it might have been calved.
Yet Flores is not utterly enchanted by the industry. There is what he terms a problem of externalities, meaning that the full cost of the venture is not appreciated when such “routine” risks as methane leaks and pollution of ground or surface water, and “high-priority” risks such as cement, drill-casing, and wastewater-impoundment failures, are not factored into the economic analysis. Such externalities are often expensive and not easily addressed, and should be internalized to reflect real costs.
Having lived in San Francisco, which receives water from the Hetch Hetchy water system, a system so pristine it is one of the few for which the Environmental Protection Agency requires no filtration, Flores comprehends the preciousness of pure water. He wonders what will happen if in our zeal to poke the earth we should inadvertently pollute a major aquifer such as the Ogallala, which underlies eight states and once contained water equal in quantity to Lake Huron. (It too is dwindling.) If such an integral resource should be fouled by whatever means, what then? Part of the damage hits the pocketbook. In heavily fracked Washington County, Pennsylvania, property values have declined almost 25 percent in places overlying aquifers through which drillers cement their casings. Is it “right” that property values have declined, or is it just perception? The answer is unimportant; all that matters is perception’s effect on the market.
Flores notes EPA’s limp-wristed governance of greenhouse gases. Methane, the major component of natural gas, is utterly ignored. (Oh, there are voluntary programs.) EPA may have downsized its prior estimate of how much methane leaks from fracking wells, but that puts it at odds with NOAA‘s recent study. Who is right? In any case, geologists and EPA agree that, compared to conventional drilling, hydraulic fracturing leaks more methane. Fracking fluid is injected and then pumped out (or a percentage is), but it returns laden with natural gas and other disinterred volatile chemicals that if released foul the air around drill sites. An estimated 90 percent of this “burping” can be captured in a “green-completion” process that caps the well and separates the petrochemicals for later sale. Even though this is of economic benefit of drillers, however, it is by no means always done; old fields may lack technology while new fields may have neither pipelines nor storage facilities built, and meanwhile methane seeps away. As you may know, methane in the atmosphere is a serious contender in atmospheric warming. Atmospheric methane gradually converts to carbon dioxide so it is over the short term that it does its damage. In its first 20 years, methane’s ability to capture heat in the atmosphere dwarfs that of carbon dioxide 70 times over.
Much like spent rods from nuclear plants and almost as dangerous, wastewater is a facet of fracking often overlooked and underfunded. Current options include dumping it into often-open holding pools, forcing it into injection wells, or recycling. Dumping it anywhere presents obvious problems including, with injection wells, persuasive evidence of earthquakes. Recycling would be great, but it’s not easy to clean water laced with not only heavy metals and radionuclides but dissolved salts, which require reverse osmosis or other exotic means to treat. (If desalinating salt water were easy, the world would have no freshwater problem, at least not yet.)
Options for dealing with wastewater are under creative review. Why not ship it away? (What do you mean there is no away?) Last March the Coast Guard “quietly” sent to the White House a proposal to put fracking wastewater on barges, said to be safer for transport than trucks and trains. The toxic brew will be shipped to someone else’s back yard for disposal. Yucca Mountain anyone? Frio County, Texas, which is not among the state’s top gas producers but that nevertheless has more disposal wells than the three top gas-producing counties combined, is evaluating a penny-a-barrel fee on disposed wastewater. The compensation is expected to bring the county over a million dollars a year, which would feed a fund to combat environmental damage.
We have such faith in compensation. While it comforts the aggrieved and pains the aggressor, that’s often as far as it goes. And the aggressor’s pain may be tiny indeed. Caps on damages provide a well-trod path for industry to escape real consequence for their sins. (Caps can zap citizens on the other cheek when they limit damages for civil suits.) In the end, let us not forget that no amount of compensation will restore what is irreplaceable.
Subterranean Aquifer Blues
Although groundwater property rights vary widely by state, they generally emphasize water quantity over contamination. Some landowners may use as much groundwater as they wish without regard for impacts anywhere else. This is called the Absolute Dominion Rule, and it is codified in 11 states, including Texas. “Use” in this case would include, I suppose, the right to pollute the groundwater. Colorado and other western states have adopted a doctrine of Prior Appropriation–the first landowner to “beneficially” use or divert water from underground is given priority over later users. Now many states have updated this doctrine with a permit system. Available permits are in hot pursuit; you can guess by whom.
When your well-water starts fizzing, fingering the culprit isn’t easy. Contaminants act differently underground, like senators behind doors. How do you prove who polluted the water, and when, and how? Equally important, what is to be done? EPA says that much progress on cleaning polluted aquifers has been made. Wells can shlep contaminated water to the surface for treatment. This intensive technology works if contaminants contain neither solvents nor oil and so long as the contamination has not spread. Since fracking fluid and wastewater are excluded and aquifers tend not to be contained, EPA’s assertion seems delusional.
Small producers lose their shirts in these times of low gas prices, so one might wonder why they keep drilling. Two reasons. Leases may mandate that lessees use their drilling rights or lose them. And prices may be low now, but just wait. Prices for natural gas in other areas–Japan, Europe–are much higher. It costs to convert gas to liquefied natural gas for long-distance transport, but producers have their eyes on the prize and preparations are being made. US prices will then rise; it won’t go the other way around.
It wasn’t so long ago that energy prices were rising in the face of looming energy scarcity. Very quickly shale-gas production has reversed that. In the first decade of this century, US gas production went from almost none to more than 10 billion cubic feet per day. In 2012, shale gas was 50 percent of the gas market; by 2035, Flores says, the percentage should swell to three-quarters. If oil imports diminish and “petro dollars” remain in the US, the dollar should be fortified and economic growth fueled by this bonanza. That is, to the extent that the bonanza remains both at low prices and here. And to the extent that climate change does not rudely intervene.
Natural gas may burn cleanly but it remains a fossil fuel. Our dependence on fossil fuels is irrevocably changing our world while we tend to our piquant concerns. Even if less is escaping at wellheads, incalculable amounts of methane now erupt from thawing Arctic tundra and waters. Will depleting a new fossil fuel will be our salvation?
With Royal Dutch Shell, price fixing is not a matter of conjecture, but normal operating procedure. Its in the company DNA. Shell has a disgraceful history of price fixing/cartel activity stretching back over a century, including a cartel operated with its Nazi partner, I.G. Farben, found guilty of war crimes. Shell’s history of market manipulation, stretches back almost to its inception, including cartel participation, price fixing, fictitious trades, monopoly, securities fraud etc. Shell was a founding member of the “Seven Sisters“, the first global oil cartel.
By John Donovan
The news media is giving huge coverage of the EU investigation into alleged price-rigging by oil companies, including Shell and BP.
It remains to be seen whether Shell is guilty on this occasion.
With Royal Dutch Shell, price fixing is not a matter of conjecture, but normal operating procedure. Its in the company DNA. Shell has a disgraceful history of price fixing/cartel activity stretching back over a century, including a cartel operated with its Nazi partner, I.G. Farben, found guilty of war crimes.
Winston Churchill attacked Shell for secret oil price rigging. Even if not well founded at that time, Churchill’s instinct was bang on.
Shell’s history of market manipulation, stretches back almost to its inception, including cartel participation, price fixing, fictitious trades, monopoly, securities fraud etc. Shell was a founding member of the “Seven Sisters“, the first global oil cartel.
The Royal Dutch Shell Group was built on price-fixing.
Some more recent examples.
New York Times: “Shell to Pay $180 Million” (Price fixing case): 3 Jan 1987
New York Times: “California Oil Price-Fixing Case Settled”: 17 August 1991
New York Times: Settlement for Coral Power: 15 November 2003
Bloomberg: Shell, Unipetrol, Bayer Are Sued Over Rubber Cartel (Update2): 20 May 2008
May 20 (Bloomberg) — Cooper Tire & Rubber Co., the second- largest U.S. tiremaker, and 25 other companies sued Unipetrol AS, units of Royal Dutch Shell Plc, Bayer AG, and as many as 20 others over an alleged rubber cartel in Europe.
Unipetrol and units of Shell, Dow Chemical Co., Eni SpA and Trade-Stomil Sp were fined a total of 519 million euros ($813 million) in a 2006 European Union antitrust case over material used to make tires and shoes. The companies are appealing.
The Times: Supermarkets and tobacco firm are fined £173m for price fixing: 12 July 2008
Reuters: EU fines “paraffin mafia” wax makers’ cartel: 1 October 2008
The Times: ‘Paraffin mafia’ comes unstuck after €676m fines: 2 October 2008
Guardian: ‘Paraffin mafia’ firms given £500m fines for price-fixing: 2 October 2008
Financial Times: Brussels fines paraffin wax cartel: 2 October 2008
The Wall Street Journal: Wax Price-Fixing Is Alleged: 2 October 2008
Financial Post (Canada): GREECE FINES BP, SHELL $80M FOR PRICE-FIXING: 26 November 2008
ChannelNewsAsia: Greece fines BP, Shell for price-fixing: 26 November 2008
International Herald Tribune: Greece: BP, Shell fined for competition breaches: 25 November 2008
Bloomberg: Chevron, Total, Exxon, Shell Fined on Air France Fuel: price fixing cartel: 4 Dec 2008 (Exxon Mobil Corp., Royal Dutch Shell PLC, Chevron fined 41.1 million euros ($52 million) by the French antitrust authority for fixing the price of fuel for certain Air France-KLM Group flights.)
Shell, Dow lose court challenge to EU antitrust fine: 13 July 2011: Reuters
(Reuters) – Royal Dutch Shell (RDSa.L) and Dow Chemical (DOW.N) lost a court appeal on Wednesday against a fine levied by EU regulators five years ago for taking part in a cartel…
…the Court upheld the 160.88 million euro fine on the Royal Dutch Shell group.
Shell settles South Africa cartel case: 21 February 2012
Would would have thought that oil barons — of all people! — would be involved in dirty back-room dealings to gorge their gobs with even more swill from the trough? From the Guardian:
“The London offices of BP and Shell have been raided by European regulators investigating allegations they have ‘colluded’ to rig oil prices for more than a decade. The European commission said its officers carried out ‘unannounced inspections’ at several oil companies in London, the Netherlands and Norway to investigate claims they may have ‘colluded in reporting distorted prices to a price reporting agency [PRA] to manipulate the published prices for a number of oil and biofuel products … It warned: ‘Even small distortions of assessed prices may have a huge impact on the prices of crude oil, refined oil products and biofuels purchases and sales, potentially harming final consumers.'”
Of course, these manipulations of “self-policing” mechanisms for setting prices are endemic across the economic heights commanded by our most illustrious financial and industrial elites, as Matt Taibbi noted last month. And I’m sure the dastardly deeds of the oil companies in fixing prices will be dealt with just as harshly and thoroughly as the recent Libor scandal was: with a few chump-change fines that put not the slightest crimp in the criminals’ operations nor impeded their ready access to the inner circles (and outer fundraisers) of government power.
So while continuing a fierce vigilance against the relentless encroachments of an unhinged, unrestrained and openly murderous government, let us also recognize that the “free market” — often posited as some kind of purer alternative to the state, a mystic realm where the free play of individual desires and activities combine ineffably to produce the best of all possible worlds — is, and always has been, a rigged game where vicious predators seek tyrannical control, by hook, crook and vast corruption, shackling the “free play of individual desires and activities” in every way possible to squeeze out more unjust advantage for themselves.
Of course, the “state” and the “free market” are simply two halves of the same rough beast. The modern “free market’ is the result of massive, continual and pervasive state intervention on its behalf — that is, on behalf of the vicious predators exercising tyrannical control of economic activity — while the state is in practice little more than a vehicle for elite aggrandizement. (Yes, even in America, even from the very beginning. For more, see this piercing piece by Arthur Silber, in which he points us to the remarkable book by Terry Boulton, Taming Democracy: “The People,” the Founders, and the Troubled Ending of the American Revolution, which I highly recommend .) If they don’t get you with one head, they’ll get you with the other.
Or as the old song says: “nobody save you now.”
The owners of The OSSL Company who have blown the whistle on a massive police corruption scandal in Ireland sponsored by Shell, are intending to confront the board of Royal Dutch Shell Plc at the AGM being held in The Hague on Tuesday 21 May.
Desmond Kane and Neil Rooney of OSSL say that they have been threatened by Shell with imprisonment and black listing if they continue to spill the beans.
What started out several years ago as Shell paying for some free alcohol given as festive gifts to a few local Garda, expanded in more recent years into a river of free booze for hundreds of Garda officers policing environmental protests against the controversial Corrib Gas Project.
We are talking about bribery and corruption. How could the Garda be impartial when so many officers were being personally rewarded by Shell. The integrity of the Garda has been damaged as a consequence of Shell’s actions.
Note that we have dropped any legal preamble such as “alleged”.
We are satisfied that the evidence we have seen, including leaked Shell emails, is authentic.
If Shell and/or the Garda dispute the facts as stated, then please sue us for defamation.
Lets get this dirty laundry aired in open court.
So what’s the prospect of either party actually issuing proceedings? None at all. They know that truth is a complete defence.
Tagged: Corrib Gas Project · Gas · Ireland · John Donovan · Litigation · Royal Dutch Shell Plc