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No, Our Oil and Gas Production Did Not Give Us an Advantage During the Crimea Crisis

And it won't give us an advantage in the future, either.

| Tue Apr. 1, 2014 4:53 PM EDT

1. The Obama administration's decision to allow BP to resume oil drilling in the Gulf of Mexico.

After energy giant BP (formerly British Petroleum) pleaded guilty to criminal negligence in the April 2010 Deepwater Horizon disaster, which resulted in the death of 11 people and a colossal oil spill, the Environmental Protection Agency (EPA) suspended the company's right to acquire new drilling leases in the Gulf of Mexico. The ban was widely viewed as a major setback for the company, which had long sought to dominate production in the Gulf's deep waters. To regain access to the Gulf, BP sued the EPA and brought other pressures to bear on the Obama administration. Finally, on March 13th, after months of lobbying and negotiations, the agency announced that BP would be allowed to resume bidding for new leases, as long as it adhered to a list of supposedly tight restrictions

BP officials viewed the announcement as an enormous victory, allowing the company to resume a frenetic search for new oil deposits in the Gulf's deep waters. "Today's agreement will allow America's largest investor to compete again for federal contracts and leases," said BP America Chairman and President John Mingé. Observers in the oil industry predict that the company will now acquire many additional leases in the Gulf, adding to its already substantial presence there. "With this agreement, it's realistic to expect that the Gulf of Mexico can be a key asset for BP's operations not only for this decade but potentially for decades to come," commented Stephen Simko, an oil specialist at Morningstar investment analysts. (Six days after the EPA announced its decision, BP bid $42 million to acquire 24 new leases in the Gulf.)

So BP's interest is clear enough, but what is the national interest in all this? Yes, President Obama can claim that increased drilling might add a few hundred thousand barrels per day to domestic oil output, plus a few thousand new jobs. But can he really assure our children or grandchildren that, in allowing increased drilling in the Gulf, he is doing all he can to reduce the threat of climate change as he promised to do in his most recent State of the Union address? If he truly sought a simple and straightforward way to renew that pledge, this would have been a good place to start: plenty of people remember the damage inflicted by the Deepwater Horizon disaster and the indifference BP's top officials displayed toward many of its victims, so choosing to maintain the ban on its access to new drilling leases on environmental and climate grounds would certainly have attracted public support. The fact that Obama chose not to do so suggests instead a further surrender to the power of oil and gas interests—and to the effects of carbon delirium.

2. The Republican drive to promote construction of the Keystone XL pipeline as a response to the Ukrainian crisis

If Obama administration dreams about pressuring Putin by exporting LNG to Europe fail to pass the credibility test, a related drive by key Republicans to secure approval for the Keystone XL tar-sands pipeline defies any notion of sanity. Keystone, as you may recall, is intended to carry carbon-dense, highly corrosive diluted bitumen from the Athabasca tar sands of Alberta, Canada, to refineries on the Gulf Coast. Its construction has been held up by concerns that it will pose a threat to water supplies along its route and help increase global carbon dioxide emissions.

Because Keystone crosses an international boundary, its construction must receive approval not just from the State Department, but from the president himself. The Republicans and their conservative backers have long favored the pipeline as a repudiation of what they view as excessive governmental deference to environmental concerns. Now, in the midst of the Ukraine crisis, they are suddenly depicting pipeline approval as a signal of US determination to resist Putin's aggressive moves in the Crimea and Ukraine.

"Putin is playing for the long haul, cleverly exploiting every opening he sees. So must we," wrote former Secretary of State Condoleezza Rice in a recent Washington Post op-ed. "Authorizing the Keystone XL pipeline and championing natural gas exports would signal that we intend to do precisely that."

Does anyone truly believe that Vladimir Putin will be influenced by a White House announcement that it will allow construction of the Keystone XL pipeline? Putin's government is already facing significant economic sanctions and other punitive moves, yet none of this has swayed him from pursuing what he appears to believe are Russia's core interests. Why, then, would the possibility that the US might acquire more of its oil from Canada and less from Mexico, Nigeria, Venezuela, and other foreign suppliers even register on his consciousness?

In addition, to suggest that approving Keystone XL would somehow stiffen Obama's resolve, inspiring him to adopt tougher measures against Moscow, is to engage in what psychologists call "magical thinking." Were Keystone to transport any other substance than oil, the claim that its construction would somehow affect presidential decision-making or events on Russia's borders would be laughable. So great is our reverence for petroleum, however, that we allow ourselves to believe in such miracles. This, too, is carbon delirium.

3. The Case of the Missing $20 Billion

Finally, consider the missing $20 billion in oil revenues from the Nigerian treasury. In Nigeria, where the average income is less than $2.00 per day and many millions live in extreme poverty, the disappearance of that much money is a cause for extreme concern. If used for the public good, that $20 billion might have provided basic education and health care for millions, helped alleviate the AIDS epidemic, and jump-started development in poor rural areas. But in all likelihood, much of that money has already found its way into the overseas bank accounts of well-connected Nigerian officials.

Its disappearance was first revealed in February when the governor of the Central Bank of Nigeria, Lamido Sanusi, told a parliamentary investigating committee that the Nigerian National Petroleum Corporation (NNPC) had failed to transfer the proceeds from oil sales to the national treasury as required by law. Nigeria is Africa's leading oil producer and the proceeds from its petroleum output not claimed by the NNPC's foreign partners are supposed to wind up in the state's coffers. With oil prices hovering at around $100 per barrel, Nigeria should theoretically be accumulating tens of billions of dollars per year from export sales. Sanusi was immediately fired by President Goodluck Jonathan for conveying the news that the NNPC has been reporting suspiciously low oil revenues to the central bank, depriving the state of vital income and threatening the stability of the nation's currency. The only plausible explanation, he suggested, is that the company's officials are skimming off the difference. "A substantial amount of money has gone," he told the New York Times. "I wasn't just talking about numbers. I showed it was a scam."

While the magnitude of the scam may be eye-catching, its existence is hardly surprising. Ever since Nigeria began producing oil some 60 years ago, a small coterie of business and government oligarchs has controlled the allocation of petroleum revenues, using them to buy political patronage and secure their own private fortunes. The NNPC has been an especially fertile site for corruption, as its operations are largely immune from public inspection and the opportunities for swindles are mammoth. Sanusi is only one of a series of well-intentioned civil servants who have attempted to plumb the depths of the thievery. A 2012 report by former anti-corruption chief Nuhu Ribadu reported the disappearance of a hardly less staggering $29 billion from the NNPC between 2001 and 2011.

Here, then, is another, equally egregious form of carbon delirium: addiction to illicit oil wealth so profound as to place the solvency and well-being of 175 million people at risk. President Jonathan has now promised to investigate Sanusi's charges, but it is unlikely that any significant portion of the missing $20 billion will ever make it into Nigeria's treasury.

Curing Addiction

These examples of carbon delirium indicate just how deeply entrenched it is in global culture. In the US, addiction to carbon is present at all levels of society, but the higher one rises in corporate and government circles, the more advanced the process.

Slowing the pace of climate change will only be possible once this affliction is identified, addressed, and neutralized. Overcoming individual addiction to narcotic substances is never an easy task; resisting our addiction to carbon will prove no easier. However, the sooner we recast the climate issue as a public health problem, akin to drug addiction, the sooner we will be able to fashion effective strategies for averting its worst effects. This means, for example, providing programs and incentives for those of us who seek to reduce our reliance on petroleum, and imposing penalties on those who resist such a transition or actively promote addiction to fossil fuels.

Divesting from fossil fuel stocks is certainly one way to go cold turkey. It involves sacrificing expectations of future rewards from the possession of such stocks, while depriving the fossil fuel companies of our investment funds and, by extension, our consent for their activities.

But a more far-ranging kind of carbon detoxification must come in time. As with all addictions, the first and most crucial step is to acknowledge that our addiction to fossil fuels has reached such an advanced stage as to pose a direct danger to all humanity. If we are to have any hope of averting the worst effects of climate change, we must fashion a 12-step program for universal carbon renunciation and impose penalties on those who aid and abet our continuing addiction.

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.

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