- By Steve LeVine<p> Steve LeVine is a contributing editor at Foreign Policy, a Schwartz Fellow at the New America Foundation, and author of The Oil and the Glory. </p>
Chasing the runaway anti-fracking train: An industry-led group suggests that shale gas drillers be required to disclose the chemical composition of their drilling fluid, which critics say can contaminate drinking water. This assessment (located half-way through a new report issued by the National Petroleum Council, and led by two big shale-gas drillers — Anadarko’s Jim Hackett and Chesapeake’s Aubrey McClendon — plus Daniel Yergin, the oil historian) isn’t surprising in content: The industry has been under enormous pressure to do so, because as it stands these drillers may be jeopardizing the potentially enormous economic and geopolitical benefit of shale gas. There is that much of a perception problem about the drilling method called hydraulic fracturing, or fracking.
Yet is one fully persuaded by this high-profile attitudinal turnaround? More than half of the 46-page report — the entire first half — is a paean to the shale gas bonanza. When it finally gets to the doubts surrounding the industry, it does so by first again praising its environmental performance. Even when it suggests that the Interior Department require all frackers to join Frac Focus, a Web-based chemical registry, the report limits that suggestion to federal lands. As for these federal lands, there too the report writers hedge — they do not recommend a mandate for full disclosure, meaning all chemical content, but only to "participate" in Frac Focus, a very different thing. In fact, very little about the report suggests an embrace of oversight. And what’s wrong with that? I think it will not quell the storm of doubts (consider this latest investigative piece by ProPublica’s Abrahm Lustgarten and Nicholas Kusnetz, describing the impact of wastewater stored in open pits near fracking sites). The industry must go demonstrably overboard in its zeal for transparency if it wants not to stunt production.
I talked on the topic of fracking over beers with Peter Robertson, the former vice chairman of Chevron, who was in Washington to present a new report by Deloitte about fracking in North America. Robertson seemed flabbergasted by the magnitude of the shale gas reserves, sufficient, he said, to produce the equivalent of 6 million barrels a day of oil. Yet he was also worried about the public relations problem. For purposes of illustration, Robinson compared the U.S. shale gas industry with Saudi Arabia, where one company produces some 10 million barrels a day of oil from a few hundred wells. Shale gas is produced by some 2,000 companies "from hundreds of thousands of wells," he said. "You’re only as good as the weakest link," Robertson said. "We have to win the public over on this one. We are not doing this in some corner, but in towns, villages and cities. They could progressively shut them down."
We have to set high standards, and we have to find a way to police, to self-police, this industry so that we do this right.
On chemical disclosure, Robertson wondered why "we don’t just do it."
Why don’t we don’t just say ‘Of course we’re going to tell you’ [what is in the fracking fluid]. Because we are, actually. It’s almost like we’re just fighting it till the end. Because we’re going to lose this one.
Et tu, Halliburton? On another environmental topic, there is much diverging opinion on how to assess a long-awaited U.S. government report on why BP’s Macondo oil well in the Gulf of Mexico blew up last year, killing 11 men (photo above). According to the Wall Street Journal, the report’s thrust relieved BP of sole blame, a position taken also by many investors, who bid up the company’s share price by 4.5 percent. Actually no, wrote the Associated Press — the report in fact laid the lion’s share of the blame at BP’s feet. As for what comes next, BP’s liabilities will be settled quickly and not be uncomfortably (for BP) stretched into next year, suggests the Houston Chronicle, quoting FBR Capital Markets. Mmmm … no, writes the AP again: The U.S. Justice Department will try to send spill culprits to prison, the news agency writes, quoting Kendall Coffey, former U.S. attorney in Miami.
What is actually likely to happen? In ordinary times, history would lead one to conclude that the spilling of 5 million barrels of oil into the ocean would result in a pillorying. But these are not ordinary times: Politics could play an outsized role, namely the 2012 presidential election. The narrative will flow from one started last year, when although oil has only just stopped spewing into the Gulf, the Republican-run state of Louisiana pressed to know why President Barack Obama was holding up drilling permits. As much as one can grasp Coffey’s argument that BP will face a firing squad, one could just as easily imagine the company paying $10 billion or so in civil fines, but being relieved of criminal responsibility.
Testing the Khodorkovsky rule: Is Russian aluminum-and-gold magnate Mikhail Prokhorov daring Prime Minister Vladimir Putin to send him to the gaol? In 2003, Russian oil oligarch Mikhail Khodorkovsky famously challenged Putin’s warning not to engage in politics, and ended up in prison (where he still languishes). Now Prokhorov, the 6-foot-8 owner of the New Jersey Nets professional basketball team — and one of Russia’s richest men — says the Kremlin is home to a "puppet-master" of politics. Prokhorov is angry because Right Cause, the pro-Kremlin liberal party of which he was leader, voted to expel him. Which means that Prokhorov now has no vehicle through which to run in December parliamentary elections. Whether or not temporary, it is quite a fall. Prokhorov has appeared to have a serious political future. For example, in the Kremlin Contest, this blog’s betting competition for who will be Russia’s next senior leaders, several contestants have selected Prokhorov as the country’s next prime minister. Alas, that appears not in the cards. Some say that Prokhorov’s saving grace may be that, in throwing stones at the Kremlin, he blamed neither Putin nor President Dmitry Medvedev. The puppet-master to whom he referred, Prokhorov said, was Vladislav Surkov, a Kremlin official who in fact does appear to be Putin’s political mechanic. Prokhorov charges that Surkov simply did not want him in the party, so engineered his ouster. I am not as certain as some that Putin won’t go after Prokhorov — can the prime minister risk the impression among other itchy oligarchs that now he can be dissed? Six months before the presidential election, I have my doubts.
Congratulations to our own Charlie Homans for his Science in Society Award, which he won for his piece "Hot Air," on the multitude of weathercasters who believe that global warming is a scam.
Jonathan cracks down, pirates attack Benin: In Nigeria, President Goodluck Jonathan has complicated the lives of oil thieves, who seem to have moved on. Their new target? Oil tankers moving through the Gulf of Guinea, reports Rick Gladstone at the New York Times. From none last year, 19 pirate attacks have been reported this year off the Benin coast. All of them have been oil tankers whose cargo is effortlessly sold onto the black markets, their hostages are freed, and the pirates liberated to move on to the next target. The number of hijacked ships may actually be higher, writes Break Bulk, a website devoted to African transportation, because those moving regularly through the area don’t want to provoke the pirates by getting them in trouble. All of this is completely on the other side of the African continent from Somalia, the usual haunt of the region’s piracy business. The west Africa pirates tend to rough up their victims, says a maritime official quoted by Gladstone. "These instances are very short, very fast and quite violent — rifle butts to the head, lashing with cables, that sort of violence," the official said. Hence ships have begun avoiding the waters off Benin altogether.