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[3 articles on Big Oil and Climate Change—count as 1 reading]
Exxon’s Climate Concealment
By NAOMI ORESKES
Naomi Oreskes is a professor of the history of science at Harvard and the author, with Erik M. Conway, of “The Collapse of Western Civilization: A View From the Future.”
http://www.nytimes.com/2015/10/10/opinion/exxons-climate-concealment.html?_r=1
OCT. 9, 2015
CAMBRIDGE, MASS. — MILLIONS of Americans once wanted to smoke. Then they came to understand how deadly tobacco products were. Tragically, that understanding was long delayed because the tobacco industry worked for decades to hide the truth, promoting a message of scientific uncertainty instead.
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The same thing has happened with climate change, as Inside Climate News, a nonprofit news organization, has been reporting in a series of articles based on internal documents from Exxon Mobil dating from the 1970s and interviews with former company scientists and employees.
Had Exxon been upfront at the time about the dangers of the greenhouse gases we were spewing into the atmosphere, we might have begun decades ago to develop a less carbon-intensive energy path to avert the worst impacts of a changing climate. Amazingly, politicians are still debating the reality of this threat, thanks in no small part to industry disinformation.
Government and academic scientists alerted policy makers to the potential threat of human-driven climate change in the 1960s and ’70s, but at that time climate change was still a prediction. By the late 1980s it had become an observed fact.
But Exxon was sending a different message, even though its own evidence contradicted its public claim that the science was highly uncertain and no one really knew whether the climate was changing or, if it was changing, what was causing it.
Exxon (which became Exxon Mobil in 1999) was a leader in these campaigns of confusion. In 1989, the company helped to create the Global Climate Coalition to question the scientific basis for concern about climate change and prevent the United States from signing on to the international Kyoto Protocol to control greenhouse gas emissions. The coalition disbanded in 2002, but the disinformation continued. Journalists and scientists have identified more than 30 different organizations funded by the company that have worked to undermine the scientific message and prevent policy action to control greenhouse gas emissions.
These efforts turned the problem from a matter of fact into a matter of opinion. When the Exxon chief executive, Lee Raymond, insisted in the late 1990s that the science was still uncertain, the media covered it, business leaders accepted it and the American people were confused.
For people close to the issue, it was never credible that Exxon — a company that employs thousands of scientists and engineers and whose core business depends on their expertise — could be that confused about the science. We now know that they not only understood the science, but contributed to it.
As early as 1977, one of Exxon’s senior scientists warned a gathering of oilmen of a “general scientific agreement” that the burning of fossil fuels was influencing the climate. A year later, he had updated his assessment, warning that “present thinking holds that man has a time window of five to 10 years before the need for hard decisions regarding changes in energy strategies might become critical.”
In the 1980s, Exxon scientists collaborated with academic and government researchers to build climate models and understand their implications. When one researcher expressed the opinion that the impacts would be “well short of catastrophic,” the director of the Theoretical and Mathematical Sciences Laboratory at Exxon Research responded in a memo, “I think that this statement may be too reassuring.” He said it was “distinctly possible” that the projected warming trend after 2030 “will indeed be catastrophic (at least for a substantial fraction of the earth’s population),” a conclusion that most climate scientists now hold, assuming we continue business as usual.
What did Exxon executives do with this information? Until 1989, they circulated reports summarizing it inside the company. They allowed their scientists to attend academic meetings, to participate in panels, and to publish their findings in peer-reviewed journals — in short, to behave as scientists. And they did acknowledge the “potentially catastrophic events that must be considered.”
Then corporate executives turned about face. As the scientific community began to speak out more strongly, first about the risks of unmitigated climate change and then about the fact that it was underway, Exxon executives and organizations funded by them embarked on a campaign designed to prevent governments from taking meaningful action. These activities continue today.
Exxon (whose spokesman has disputed the Inside Climate News reporting) had a choice. As one of the most profitable companies in the world, Exxon could have acted as a corporate leader, helping to explain to political leaders, to shareholders and institutional investors, and to the public what it knew about climate change. It could have begun to shift its business model, investing in renewables and biofuels or introducing a major research and development initiative in carbon capture. It could have endorsed sensible policies to foster a profitable transition to a 21st-century energy economy.
Instead — like the tobacco industry — Exxon chose the path of disinformation, denial and delay. More damagingly, the company set a model for the rest of the industry. More than 30 years ago, Exxon scientists acknowledged in internal company memos that climate change could be catastrophic. Today, scientists who say the exact same thing are ridiculed in the business community and on the editorial page of The Wall Street Journal.
We have lost precious time as a result: decades during which we could have built a smart electricity grid, fostered efficiency and renewables and generated thousands of jobs in a cleaner, greener economy. There is still time to prevent the worst disruptions of human-driven climate change, but the challenge is now much greater than it needed to be, in no small part because of the choices that Exxon Mobil made.
Exxon Mobil Investigated for Possible Climate Change Lies by New York Attorney General
By JUSTIN GILLIS and CLIFFORD KRAUSS
http://www.nytimes.com/2015/11/06/science/exxon-mobil-under-investigation-in-new-york-over-climate-statements.html?_r=0
NOV. 5, 2015
The New York attorney general has begun an investigation of Exxon Mobil to determine whether the company lied to the public about the risks of climate change or to investors about how such risks might hurt the oil business.
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According to people with knowledge of the investigation, Attorney General Eric T. Schneiderman issued a subpoena Wednesday evening to Exxon Mobil, demanding extensive financial records, emails and other documents.
The investigation focuses on whether statements the company made to investors about climate risks as recently as this year were consistent with the company’s own long-running scientific research.
The people said the inquiry would include a period of at least a decade during which Exxon Mobil funded outside groups that sought to undermine climate science, even as its in-house scientists were outlining the potential consequences — and uncertainties — to company executives….[Dunn cut rest for space reasons]
Is Big Oil Finally Entering a Climate Change World?
By Michael T. Klare | (Tomdispatch.com)
[Michael T. Klare, a TomDispatch regular, is a professor of peace and world security studies at Hampshire College and the author, most recently, of The Race for What’s Left. A documentary movie version of his book Blood and Oil is available from the Media Education Foundation.]
http://www.tomdispatch.com/post/175967/tomgram%3A_michael_klare%2C_is_big_oil_finally_entering_a_climate_change_world/
March 12, 2015
Many reasons have been provided for the dramatic plunge in the price of oil to about $60 per barrel (nearly half of what it was a year ago): slowing demand due to global economic stagnation; overproduction at shale fields in the United States; the decision of the Saudis and other Middle Eastern OPEC producers to maintain output at current levels (presumably to punish higher-cost producers in the U.S. and elsewhere); and the increased value of the dollar relative to other currencies. There is, however, one reason that’s not being discussed, and yet it could be the most important of all: the complete collapse of Big Oil’s production-maximizing business model.
Until last fall, when the price decline gathered momentum, the oil giants were operating at full throttle, pumping out more petroleum every day. They did so, of course, in part to profit from the high prices. For most of the previous six years, Brent crude, the international benchmark for crude oil, had been selling at $100 or higher. But Big Oil was also operating according to a business model that assumed an ever-increasing demand for its products, however costly they might be to produce and refine. This meant that no fossil fuel reserves, no potential source of supply — no matter how remote or hard to reach, how far offshore or deeply buried, how encased in rock — was deemed untouchable in the mad scramble to increase output and profits.
In recent years, this output-maximizing strategy had, in turn, generated historic wealth for the giant oil companies. Exxon, the largest U.S.-based oil firm, earned an eye-popping $32.6 billion in 2013 alone, more than any other American company except for Apple. Chevron, the second biggest oil firm, posted earnings of $21.4 billion that same year. State-owned companies like Saudi Aramco and Russia’s Rosneft also reaped mammoth profits.
How things have changed in a matter of mere months. With demand stagnant and excess production the story of the moment, the very strategy that had generated record-breaking profits has suddenly become hopelessly dysfunctional.
To fully appreciate the nature of the energy industry’s predicament, it’s necessary to go back a decade to 2005, when the production-maximizing strategy was first adopted. At that time, Big Oil faced a critical juncture. On the one hand, many existing oil fields were being depleted at a torrid pace, leading experts to predict an imminent “peak” in global oil production, followed by an irreversible decline; on the other, rapid economic growth in China, India, and other developing nations was pushing demand for fossil fuels into the stratosphere. In those same years, concern over climate change was also beginning to gather momentum, threatening the future of Big Oil and generating pressures to invest in alternative forms of energy.
A “Brave New World” of Tough Oil
No one better captured that moment than David O’Reilly, the chairman and CEO of Chevron. “Our industry is at a strategic inflection point, a unique place in our history,” he told a gathering of oil executives that February. “The most visible element of this new equation,” he explained in what some observers dubbed his “Brave New World” address, “is that relative to demand, oil is no longer in plentiful supply.” Even though China was sucking up oil, coal, and natural gas supplies at a staggering rate, he had a message for that country and the world: “The era of easy access to energy is over.”
To prosper in such an environment, O’Reilly explained, the oil industry would have to adopt a new strategy. It would have to look beyond the easy-to-reach sources that had powered it in the past and make massive investments in the extraction of what the industry calls “unconventional oil” and what I labeled at the time “tough oil”: resources located far offshore, in the threatening environments of the far north, in politically dangerous places like Iraq, or in unyielding rock formations like shale. “Increasingly,” O’Reilly insisted, “future supplies will have to be found in ultradeep water and other remote areas, development projects that will ultimately require new technology and trillions of dollars of investment in new infrastructure.”
For top industry officials like O’Reilly, it seemed evident that Big Oil had no choice in the matter. It would have to invest those needed trillions in tough-oil projects or lose ground to other sources of energy, drying up its stream of profits. True, the cost of extracting unconventional oil would be much greater than from easier-to-reach conventional reserves (not to mention more environmentally hazardous), but that would be the world’s problem, not theirs. “Collectively, we are stepping up to this challenge,” O’Reilly declared. “The industry is making significant investments to build additional capacity for future production.”
On this basis, Chevron, Exxon, Royal Dutch Shell, and other major firms indeed invested enormous amounts of money and resources in a growing unconventional oil and gas race, an extraordinary saga I described in my book The Race for What’s Left. Some, including Chevron and Shell, started drilling in the deep waters of the Gulf of Mexico; others, including Exxon, commenced operations in the Arctic and eastern Siberia. Virtually every one of them began exploiting U.S. shale reserves via hydro-fracking.
Only one top executive questioned this drill-baby-drill approach: John Browne, then the chief executive of BP. Claiming that the science of climate change had become too convincing to deny, Browne argued that Big Energy would have to look “beyond petroleum” and put major resources into alternative sources of supply. “Climate change is an issue which raises fundamental questions about the relationship between companies and society as a whole, and between one generation and the next,” he had declared as early as 2002. For BP, he indicated, that meant developing wind power, solar power, and biofuels.
Browne, however, was eased out of BP in 2007 just as Big Oil’s output-maximizing business model was taking off, and his successor, Tony Hayward, quickly abandoned the “beyond petroleum” approach. “Some may question whether so much of the [world’s energy] growth needs to come from fossil fuels,” he said in 2009. “But here it is vital that we face up to the harsh reality [of energy availability].” Despite the growing emphasis on renewables, “we still foresee 80% of energy coming from fossil fuels in 2030.”
Under Hayward’s leadership, BP largely discontinued its research into alternative forms of energy and reaffirmed its commitment to the production of oil and gas, the tougher the better. Following in the footsteps of other giant firms, BP hustled into the Arctic, the deep water of the Gulf of Mexico, and Canadian tar sands, a particularly carbon-dirty and messy-to-produce form of energy. In its drive to become the leading producer in the Gulf, BP rushed the exploration of a deep offshore field it called Macondo, triggering the Deepwater Horizon blow-out of April 2010 and the devastating oil spill of monumental proportions that followed.
Over the Cliff
By the end of the first decade of this century, Big Oil was united in its embrace of its new production-maximizing, drill-baby-drill approach. It made the necessary investments, perfected new technology for extracting tough oil, and did indeed triumph over the decline of existing, “easy oil” deposits. In those years, it managed to ramp up production in remarkable ways, bringing ever more hard-to-reach oil reservoirs online.