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Posts from ‘July, 2010’

Former Interior Secretary: Attitude of ‘Mutual Problem Solving’ With Oil Industry Under Bush

The Washington Independent

By Andrew Restuccia 7/20/10 12:52 PM

Former Interior Department Secretary Gale Norton told a congressional panel today that the department, under her tenure, saw its relationship with the oil industry when permitting and licensing offshore drilling projects as one “of mutual problem solving.”

Norton’s remarks came during a House Energy & Commerce Committee joint-subcommittee hearing on the Interior Department’s involvement in the Deepwater Horizon oil spill. Norton, who served as Interior secretary from 2001 to 2006 under President Bush, took a job with Royal Dutch Shell after resigning, leading to a Department of Justice probe.

“They also wanted to work with the expertise that industry had. Industry was at the cutting edge, coming up with new technologies every day. You can’t just sit back and be distant from that,” Norton said, responding to a questions from Rep. Jerry McNerney (D-Calif) about whether it was the Bush administration’s policy to give less oversight to the oil industry. Dirk Kempthorne, who served as Interior secretary from 2006 to 2009, said that was “absolutely not” the administration’s policy.

Democrats took advantage of the opportunity at the hearing to raise question about the Bush administration’s oversight of the oil industry. Current Interior Secretary Ken Salazar, who has also come under fire for the way his department regulated the industry, will also testify before the panel today.

SOURCE ARTICLE

Alaskan Eskimos say oil drilling threatens way of life

BBC NEWS

“The Gulf of Mexico may have been a wake-up call for some but not for Shell,” says Pete Slaiby, vice-president of Shell Alaska.

Barrow’s Inuit blanket toss in action

Indigenous Eskimos living on the edge of the Arctic Ocean fear new oil drilling could destroy their unique way of life, but many Alaskans believe the Arctic’s energy reserves could be economically and politically important. The BBC’s Rajesh Mirchandani visited the Arctic town of Barrow during a traditional spring whale-hunting festival.

The town of Barrow on Alaska’s northernmost tip is one of the most remote places on earth. No roads cross the Arctic tundra to get here, and the nearest city – Fairbanks – is 90 minutes away by air.

It’s a place of extremes: in winter it stays dark for more than two months, but now, midnight looks like midday as townsfolk hurl children one by one into the air on a mat made of seal skin.

Map showing Barrow and Fairbanks, Alaska

The blanket toss is part of Naluqatak, a spring festival held in Eskimo villages across Alaska’s Arctic north slope. Most people in Barrow are at least part-native and hundreds have turned out, many in traditionally-made coats of animal fur, to celebrate another catch: whale.

Twice a year Eskimo communities like this hunt whale. It’s legal and not commercial, and for thousands of years people in the Alaskan Arctic have depended on the meat.

Major environmental groups don’t condone the hunting but tolerate it as an intrinsic part of a subsistence culture.

It’s not really subsistence any more, but tribal elders say chicken or steak bought in a shop is not enough – their bodies crave whale blubber.

At the spring whaling festival, everyone rejoices and shares in the harvest.

Local meats are cooked and served, including caribou stew and goose soup. But the main attraction is boiled whale meat, including the giant mammals’ organs.

Rajesh Mirchandani samples the food on offer at the festival – including whale intestines

Dismembered parts of a bowhead whale are on display, laid out on a wooden pallet in the middle of a makeshift arena by the Arctic shore. It is cut into brick-sized chunks and distributed.

People will savour its meat through the long frozen winter.

But many here worry the whales will bypass Barrow’s waters if offshore oil exploration goes ahead, and they have filed lawsuits to stop it.

Oil company Shell has spent billions of dollars to lease tracts of seabed from the US government and drilling should have started by now.

But the Obama administration stepped in and called a temporary halt after the BP oil spill thousands of miles away in the Gulf of Mexico.

An Alaskan child at the Naluqatak festival in Barrow Adults and children celebrate at the Naluqatak festival

The delay effectively puts back Shell’s plans till next year but the company says it will be back.

“The Gulf of Mexico may have been a wake-up call for some but not for Shell,” says Pete Slaiby, vice-president of Shell Alaska.

“We would not have put the money down on these leases had we not felt we could go in and drill these leases safely.”

Earlier this year, before the order to postpone, Shell reassured the US government it could work safely in Arctic waters.

It said it would be drilling at a depth of 150ft (46m), not 5,000ft as in the case of BP’s leaking well, making it easier to deal with a blowout.

Shell also pointed out the cold Arctic waters would render any spilled oil more viscous, so it would not spread as far. (The converse is that the warm waters and sunshine in the Gulf of Mexico help break down oil.)

And the company said it would position state-of-the-art vessels by the drill site so it could respond to a spill within an hour.

Contamination fears

Critics argue no response plan can predict the rapidly-changing conditions of the Arctic and say response vessels may be useless if a spill happens when the sea is choked with ice, as it is much of the year.

Bowhead whale bones at the Naluqatak festival Many Eskimos fear contaminating Alaskan waters would impact hunting

Nevertheless, the majority of Alaskans favour offshore drilling in the Arctic – the state derives 90% of its revenue from oil and gas.

Even though the waters are controlled by the federal government, many, including some among the indigenous people, believe Alaska’s Arctic Ocean reserves will bring jobs and could help reduce America’s dependence on foreign oil.

But in Barrow and other Eskimo towns, most don’t want to risk contaminating the Arctic waters.

“The ocean is our garden,” one woman here said. “It’s where we get our food from. Not just the whale but the seal and walrus as well, and all the other stuff.”

A woman handing out whale meat said: “If you look at the Gulf of Mexico, they were cutting corners. If they do that here they’ll be cutting our livelihood. We can’t have that.”

BBC ARTICLE (WITH WORKING VIDEO CLIPS)

Oil Sands Rising as BP Spill Casts Palls Over Future of Deepwater Drilling

Bloomberg

By Irene Shen and Matt Walcoff – Jul 20, 2010

Suncor Energy Inc. and Canadian Natural Resources Ltd., two of the largest oil-sands producers, rank among the biggest winners as a U.S. halt on new Gulf of Mexico drilling leads investors to alternative crude sources.

Canadian energy stocks are drawing the highest premium since 2005. Standard & Poor’s/TSX Energy Index of Canadian stocks now trades for 32.1 times reported profit from the past year, more than twice as much as fuel producers in the MSCI World Index, the benchmark for equities in 24 developed markets.

Oil-sands miners, which strip crude from tar-soaked earth, have been reviled by environmental groups such as the Pembina Institute over toxic waste and carbon emissions from oil processing that contribute to global warming. The projects now don’t look as harmful compared with deepwater drilling, after BP Plc’s spill tarred about 550 miles of shoreline from Texas to Florida, said Don Coxe, a strategy adviser to Bank of Montreal’s BMO Capital Markets unit.

“It’s going to be many months before people figure that offshore drilling in the U.S. is going to be something you can take a bet on,” Coxe said. “For those looking for resources, the oil sands are the best place to go in North America.”

After the Deepwater Horizon rig blew up in the Gulf in April, the Obama administration imposed an initial moratorium on new deepwater drilling, citing safety concerns.

New Moratorium

That ban was rejected by a federal judge. Interior Secretary Kenneth Salazar announced a new one July 12 which identifies at-risk wells based on drilling configurations and technologies instead of water depth.

Oil output from the Gulf region may fall by as much as 300,000 barrels a day in the next five years, the International Energy Agency has forecast.

As a hedge against tighter oil supplies, investors will pump more money into companies that extract crude from Alberta’s sands, said Adam Waterous, global head of investment banking at Scotia Capital Inc., the investment-banking arm of Toronto-based Bank of Nova Scotia.

Total SA, Europe’s third-biggest oil producer, said on July 7 it will buy UTS Energy Corp. for C$1.5 billion ($1.4 billion) to boost its output from Canadian oil sands. The price is 81 percent more than what Total had declared as its final offer for the company in an April 2009 bid.

Suncor, TransCanada

Investors are raising valuations for oil-sands companies, while those for the largest U.S. oil companies decline. The higher price-to-earnings ratio indicates investors are willing to pay a premium for the oil-sands production.

Suncor Energy, Canada’s largest energy company, has had a 7.7 percent increase in its forward price-earnings ratio, even as oil slid 3.7 percent this year. The ratio for TransCanada Corp., which is building a pipeline to deliver oil-sands fuel to southern U.S. refineries, climbed 3.2 percent.

In contrast, the price-to-earnings ratio of Exxon Mobil Corp., the world’s largest energy company by market value, dropped 4.8 percent, and that of Chevron Corp., the MSCI World/Energy Index’s No. 2 company by weighting, declined 10 percent.

Alberta’s oil sands contain the biggest crude reserves outside of Saudi Arabia, according to Canadian government estimates. Bitumen, the semi-solid crude beneath northeastern Alberta’s boreal forest, will be the base of the largest single source of U.S. oil imports this year, according to industry consulting group, IHS CERA.

Production Rising

By 2030, oil sands may account for as much as 36 percent of U.S. oil and refined-product imports, up from 8 percent in 2009, the group has said.

The province’s bitumen output will more than double to 3.2 million barrels a day for a total 1.2 billion barrels a year by 2019, according to the Energy Resources Conservation Board’s 2009 annual report.

Opposition to development has come mainly from environmental organizations including the Sierra Club and Greenpeace.

An Alberta judge ruled last month that Syncrude Canada Ltd., the largest oil-sands miner, was responsible when 1,606 ducks died in 2008 after landing on one of the company’s toxic- waste ponds. By comparison, the Exxon Valdez disaster in 1989 killed 100,000 to 300,000 birds, according to a 1990 study by Alaska biologists.

Keystone XL Pipeline

In a July 2 letter to the Washington Post published in a C$58,000 advertisement, Alberta Premier Ed Stelmach defended the oil sands against accusations of environmental damage. The ad came after 50 U.S. congressmen sought a hold on the expansion of the Keystone XL pipeline, TransCanada’s conduit between the oil sands and refineries on the U.S. Gulf Coast.

The increase in interest in oil-sands production after the Gulf spill isn’t necessarily good news for the industry, said Dave Collyer, president of the Canadian Association of Petroleum Producers. The new burst of investment may bring more environmental scrutiny, said Collyer, former president of Royal Dutch Shell Plc’s Canadian unit.

“We need to deal with broader issues of public confidence,” he said.

To contact the reporters on this story: Irene Shen in Calgary at ishen4@bloomberg.net; Matt Walcoff in Toronto at mwalcoff1@bloomberg.net.

BLOOMBERG ARTICLE

Film about Shell’s controversial Corrib Gas Project wins major award at Galway International Film Festival

‘The Pipe’ has won the best documentary award at the prestigious Galway Film Fleadh, selling out both screenings and receiving standing ovations on both occasions. A documentary film, four years in the making, ‘The Pipe’ tells the story of the people of Rossport in the West of Ireland, and the efforts of the Shell Oil company to lay a high pressure, raw gas pipeline through their community.



The rights of farmers over their fields, and of fishermen to their fishing grounds, have come into direct conflict with one of the world’s most powerful oil companies. When the citizens look to their State to protect their rights, they find that the government has put Shell’s right to lay a pipeline over their own. Risteard Ó Domhnaill’s compelling documentary follows three very different characters as the local community is plunged into turmoil, not only by their opposition to the project, but more tragically, by the struggles within their own campaign. ThePipe tells the story of a pipeline that can bring economic prosperity or destroy a way of life shared for generations.

www.thepipethefilm.com
www.facebook.com/pages/The-Pipe-The-Film

Bye-bye BP?

NEW YORK DAILY NEWS

Bye-bye BP? The British oil company faces a dramatic restructuring after Gulf Coast oil spill

BY Helen Kennedy

DAILY NEWS STAFF WRITER: Sunday, July 18th 2010, 2:53 PM

Noonan for News: A BP gas station in Harlem was cleaned after being vandalized last month. The company’s image, however, may never recover.
BP may sell off its gas stations and scale back US operations, a British newspaper reported Sunday.

Even as the news from the Gulf Coast looked bright – the cap on the broken well continued to hold back the oil gusher for a third day -  the firm’s future seemed to darken.

The Sunday Times of London reported that directors at the oil giant once known as British Petroleum had been discussing a dramatic restructuring of the company with major shareholders.

Options reportedly include splitting up the conglomerate by selling off its refineries and gas stations, and doing more engineering in-house rather than outsourcing it.

The restructuring of BP could render it a significantly smaller firm focusing primarily on exploration in emerging oil regions in Africa and Latin America.

The company is also planning to sell about 10% of its assets to cover the cost of the devastating oil spill, which has so far hit $3.5 billion, with many more expenses to come.

BP employs about 51,600 people in its gas stations and refineries -  more than half of the firm’s 80,300-strong workforce – but those parts of the business account for just 3% of the company’s pre-tax profit, the paper said.

Meanwhile, things looked sunnier on the Gulf Coast than they have in three months.

“We’re not seeing any problems, at this point,” Doug Suttles, BP’s chief operating officer, said at a press briefing about the well cap holding firm.

He said the company plans to keep the cap in place, stopping the flow of oil into the gulf, until a relief well to be completed in the next few weeks can kill it for good.

Earlier, the plan had been to re-open the well and connect it to pipes that would siphon the leak up toward ships on the surface.

That maneouver would have finally allowed scientists to gauge for sure how much oil has been leaking – a key factor in how much BP is on the hook for in terms of damages.

But BP said it would also mean as many as three more days of leaking oil while the pipes were re-connected.

“No one wants to see oil flowing back into the sea, and to initiate containment would require that to occur,” Suttles said.

The absence of leaking oil brought relief to the battered coast.

“It is welcome news. It’s the first piece that we’ve had in a long time,” New Orleans Mayor Mitch Landrieu told CNN of the well cap holding firm.

“But it’s just a beginning. We have a very, very long way to go,” he said. “We really have to aggressively capture the oil, clean the coast, make sure that all of the families are compensated, and then begin to restore the wetlands down here.”


BP should face criminal probe for its role in freeing Lockerbie bomber, Sen. Chuck Schumer says

NEW YORK DAILY NEWS

BY Erin Durkin
DAILY NEWS WRITER

Monday, July 19th 2010, 4:00 AM

Zeitvogel/Getty: An anti-BP sign is displayed at a home in Louisiana.

BP should face a criminal investigation into its role in freeing the Lockerbie bomber, Sen. Chuck Schumer (D-N.Y.) said.

Schumer and victims’ relatives called on Attorney General Eric Holder to look into whether the oil giant broke federal laws by lobbying the British government to free Libyan terrorist Abdel Baset al-Megrahi to help them close a $900 million oil deal with Libya.

“No matter how powerful the corporation, how important the foreign government, a blood money deal is a blood money deal,” Schumer said.

The Foreign Corrupt Services Act makes it a crime for a corporation to give anything of value to a foreign government in order to influence its actions.

BP has admitted lobbying the British government to speed up a prisoner exchange with Libya, though it denied specifically pushing for al-Megrahi’s release.

The British government has long denied any link between the bomber’s release last August and the oil deal – but few were buying the denial.

“BP wanted access to Libya’s oil fields. Libya wanted Megrahi back,” Schumer said. “This hardly seems like a coincidence.”

Victims’ families agreed.

“I think this is criminal,” said Brian Flynn of Manhattan, whose brother J.P. was one of 259 people killed on board Pan Am 103 in the 1988 disaster. “The British economy was in trouble. The Labor government was in trouble. And they chose to sell out to the Libyan government and to British Petroleum.”

Brice Daniels of New Jersey, who was just 7 years old when he lost his father, agreed.

SOURCE ARTICLE

“It’s a whole lot of winking and nudging,” he said. “It’s sickening.”

Ratings downgrade for Ireland despite huge Corrib gas reserves

By John Donovan

It is sad to see that the “Celtic Tigers” credit rating has today been downgraded by Moodys to Aa2.

“Today’s downgrade is primarily driven by the Irish government’s gradual but significant loss of financial strength, as reflected by its deteriorating debt affordability,” said Moody’s lead analyst for Ireland Dietmar Hornung. (extract from Irish Times Article)

Ireland is unfortunately another country where corrupt politicians sold off valuable national hydrocarbon assets to unscrupulous oil companies for a pittance.

In 1987, in a move described as “economic treason”, Irish Minister for Energy, Ray Burke,  abolished all royalties on petroleum and natural gas extraction. Burke was later convicted and jailed on charges arising from political corruption in office.

Protesters against the controversial Corrib gas project allege that the astonishing deal made by Burke, which exempted Royal Dutch Shell from paying royalties for gas extraction, was corrupt.

The Irish national interest was disregarded.  The local population affected by the Corrib Gas Project project has been left to the mercy of a ruthless and reckless oil giant with an atrocious track record of health and safety violations and leaving massive environmental pollution in its wake.

Ireland is stuck with the debts created by corrupt incompetent politicians, while Shell and its Corrib partners own the valuable gas reserves rightly belonging to the Irish people.

BP in shareholder talks on break-up

By Karl West
Last updated at 10:37 PM on 18th July 2010


Under-fire oil company BP has started talking to leading shareholders about a radical restructuring, including a break-up of the business.

The early stage discussions with investors have focused on a possible sale of the group’s petrol stations and refineries, scaling back its troubled US operations and ramping-up in-house engineering instead of outsourcing.

Spinning off the oil major’s so-called ‘downstream’ assets has long been mooted by analysts and investors.

It accounts for just 3 per cent of group profits, and yet employs the lion’s share of BP’s workforce, accounting for 50,000 of its 80,000 staff.

BP is also moving ahead with a sale of about 10 per cent of its assets, including its stake in the giant Prudhoe Bay field in Alaska.

The overhaul would leave BP a significantly smaller player with a much greater focus on exploration in emerging oil regions, such as West Africa and Brazil.

Talks with investors about ‘Future BP’ follow its part in the huge oil spill in the Gulf of Mexico. A source said: ‘All sorts of things have been discussed.’

A BP spokesman declined to comment.

On Saturday, the oil group extended for another 24 hours a critical test of its ruptured Macondo well.

BP stopped the gusher on Thursday evening after fitting it with a 45-tonne cap.

Last night, BP’s chief operating officer Doug Suttles said he was ‘hopeful’ that the ruptured well can remain sealed until a pair of relief wells permanently stop the flow.

‘Right now there is no target set to open the well back up to flow,’ he added.

‘Clearly we don’t want to re-initiate flow into the Gulf if we don’t have to.’

BP last month said it was making a £13billion fund available to compensate people affected by the Gulf of Mexico oil spill.

The environmental disaster has enraged the US public and angered the White house, which is also asking difficult questions about BP’s role in a deal between Britain and Libya for the release of Lockerbie bomber Abdelbaset Ali Mohmed Al-Megrahi.

DAILY MAIL ARTICLE

BP oil cap may not have stopped leak

guardian.co.uk home

Government demands answers as engineers detect seepage and possible methane gas leak on seabed of Gulf of Mexico

Matthew Weaver: Monday 19 July 2010 08.22 BST

Oil sheen is seen among vessels assisting near the source of the BP oil spill in the Gulf of Mexico. Photograph: Mario Tama/Getty Images

BP‘s new cap over its damaged Gulf of Mexico oil well may not have been as successful as the company had hoped after engineers detected seepage and a possible methane gas leak on the seabed.

Admiral Thad Allen, who is in charge of the US government’s response to the disaster, has written to BP demanding answers to “undetermined anomalies at the well head”. He ordered BP to provide a plan for reopening the well by 1am today (BST).

In a letter to BP’s managing director, Bob Dudley, he said: “When seeps are detected, you are directed to marshal resources, quickly investigate, and report findings to the government in no more than four hours.

“I direct you to provide me a written procedure for opening the choke valve as quickly as possible without damaging the well should hydrocarbon seepage near the well head be confirmed.”

BP has yet to respond to Allen’s letter.

Yesterday company officials said the cap was holding and continued to prevent oil spewing into the gulf for the first time since the rig exploded in April, killing 11 workers. They expressed hope that the cap could stem the leak until relief wells were in place to permanently shut off the flow of oil. But the discovery of seepage could mean there were still leaks in the damaged well.

The plan had been for BP to pipe oil to the surface, which would ease pressure on the well but would require up to three more days of oil spilling into the gulf.

Doug Suttles, BP’s chief operating officer, said last night: “No one associated with this whole activity … wants to see any more oil flow into the Gulf of Mexico. Right now we don’t have a target to return the well to flow.”

The new potential blow comes as David Cameron travels to Washington later today for his first full length bilateral meeting with Barack Obama at which they are expected to discuss the BP oil crisis.

The spill is the worst in US history, causing economic and environmental disaster in five states along the gulf coast, and threatens to sour Anglo-American relations.

SOURCE ARTICLE

Shell to Sea campaigner released from jail

The Irish Times – Monday, July 19, 2010

Pat O’Donnell: jailed for abusive behaviour towards a garda

BY LORNA SIGGINS

ERRIS FISHERMAN Pat O’Donnell has pledged to continue his opposition to the Corrib gas project on health, safety and environmental grounds, following his release from prison at the weekend.

Mayor of Roscommon Cllr Luke “Ming” Flanagan sent a message of support to Mr O’Donnell during a rally held by Shell to Sea supporters in Castlerea, Co Roscommon, to mark the fisherman’s release on Saturday morning.

Mr O’Donnell (52) served just over five months of a seven-month sentence imposed at Castlebar Circuit Court on February 10th last.

He received a three-month sentence for threatening and abusive behaviour towards a garda at Glengad on September 13th, 2008, and an additional four months for wilful obstruction of a peace officer on September 14th, 2008 at Doolough, Geesala.

Speaking after the rally and a car cavalcade to Ballina, via Roscommon and Castlebar, Co Mayo, Mr O’Donnell said that his “worst fears had been realised” in prison, when the Deepwater Horizon rig exploded and sank in the Gulf of Mexico on April 20th.

As a fisherman, he said he “felt” for his colleagues who could no longer fish in the Gulf of Mexico due to the consequent pollution.

“They were depending on “fail safe” valves which didn’t work . . . the same thing could happen here,” Mr O’Donnell said.

He said he met some of “the most decent people ever” in prison – men from “difficult social backgrounds who had committed crime at a young age and were unable to put their lives back together”.

Up to 120 attended the Shell to Sea rally to mark Mr O’Donnell’s release, including some supporters of the Éirígí socialist republican political party. Éirígí Sligo activist Gerry Casey paid tribute in a statement to Mr O’Donnell’s “resilience” and said he pledged his party’s “continued support” for the Shell to Sea campaign.

SOURCE ARTICLE