Saving What Remains

OIL

July 22, 2012



OVERVIEW

The oil industry has a less-than-stellar environmental record in general, but it becomes even worse in tropical rainforest regions, which often contain rich deposits of petroleum. The most notorious examples of rainforest havoc caused by oil firms are Shell Oil in Nigeria and Texaco in Ecuador. The operations run by both companies degraded the environment and affected local and Indigenous people by their activities. The Texaco operation in Ecuador was responsible for spilling some 17 million gallons of oil into the biologically rich tributaries of the upper Amazon, while in the 1980s and 1990s Shell Oil cooperated with the oppressive military dictatorship in Nigeria in the suppression and harassment of local people.

ACTION

The simplest and most reliable way to mitigation damage from oil operations would be to prohibit oil extraction in the tropical rainforest. But that is unlikely given the number of tropical countries that produce oil and the wealth of oil deposits located in forest areas. Thus the focus is on reducing pollution and avoiding spills through better pipeline management, reinjection techniques, and halting methane flaring. Limiting road development and restricting access can help avoid deforestation associated with settlement.

Biofuels

The energy and technology sectors are investing heavily in alternatives to conventional fossil fuels, but early efforts to use crop-based biofuels have had serious environmental consequences.

While some believed biofuels—fuels that are derived from biomass, including recently living organisms like plants or their metabolic byproducts like cow manure— would offer environmental benefits over conventional fossils fuels, the production and use of biofuels derived from palm oil, soy, corn, rapeseed, and sugar cane have in recent years driven up food prices, promoted large-scale deforestation, depleted water supplies, worsened soil erosion, and lead to increased air and water pollution. Still, there is hope that the next generation of biofuels, derived from farm waste, algae, and native grasses and weeds, could eliminate many of the worse effects seen during the current rush into biofuels.

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Efficiency

Good old-fashioned oil conservation is effective in reducing demand for oil products. After the first OPEC embargo in 1973, the United States realized the importance of oil efficiency and initiated policies to do away with wasteful practices. By 1985, the U.S. was 25 percent more energy efficient and 32 percent more oil efficient than in 1973. Of course the U.S. was upstaged by the Japanese who in the same period improved their energy efficiency by 31 percent and their oil efficiency by 51 percent. Today the importance of oil to the economy continues to diminish. Despite the 51 percent growth in the American economy between 1990 and 2004, carbon emissions only increased 19% suggesting that those who insist that economic growth and carbon dioxide emissions move in tandem are wrong.

DEVELOP NEW TECHNOLOGY

The developed world can seek alternative methods to oil exploration, by developing new technologies that rely less on processes that are ecologically damaging. For example, compressed natural gas is a cleaner-burning fuel than gasoline, is already used in some cars, and is available in vast quantities. Electric cars are potentially even more environmentally sound.

To encourage investment in research and development of "greener" technologies, governments can help by eliminating subsidies for the oil and gas industry and imposing higher taxes on heavy polluters. While governments will play a role in cleaner-energy development, it is likely that the private sector will provide most of the funding and innovation for new energy projects. Venture capital firms and corporations have put billions into new technologies since the mid-2000s, while corporations are getting on board as well.

As experiences with biofuels have shown, there are often downsides to alternative energy sources. For example, hydroelectric projects have destroyed river systems and flooded vast areas of forests. Thus when undertaking any large-scale energy project — whether it's wind, solar, tidal, geothermal, or something else — it is important to conduct a proper assessment of its impact.

CONCLUSION

Admittedly, there are many challenges facing sustainable use of tropical rainforests. In arriving at a solution many issues must be addressed, including the resolution of conflicting claims to land considered to be in the public domain; barriers to markets; the assurance of sustainable development without over-exploitation in the face of growing demand for forest products; determination of the best way to use forests; and the consideration of many other factors.

Almost none of these economic possibilities can become realities if the rainforests are completely stripped. Useful products cannot be harvested from species that no longer exist, just as eco-tourists will not visit the vast stretches of wasteland that were once lush forest. Thus some of the primary rainforests must be salvaged for sustainable development to be at all successful.

PT Chevron Pacific Indonesia oil field. Photo by Rhett A. Butler

Review questions:

  • What are some alternative sources of energy beyond oil, gas, and coal?
  • Why can palm biodiesel be damaging to the rainforest?

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Continued / Next: Rehabilitation

  • Steps taken by Shell Oil in Gabon to reduce access to their oil site are mentioned in Judah, T., "Rumbles in the Jungle," Mail and Guardian, 7/30/99.
  • The description of Shell's eco-friendly planning for their Peruvian oil project is from Friedland, J., "Oil Companies Strive To Turn A New Leaf to Save Rain Forest," Wall Street Journal, 7/17/97.
  • R.C. Rockwell explains how less developed countries can avoid the long term costs of pollution by adopting more advanced energy infrastructure in "From a carbon economy to a mixed economy: a global opportunity," Consequences, Vol. 4 No. 1 1998.
  • Despite the booming American economy of 1998, carbon dioxide emissions remained almost flat in the United States, while world emissions fell 0.5% as reported in Fialka, J.J. "Flat CO2 emissions give experts hope," The Wall Street Journal, 8/2/99.
  • Daniel Yergin, in The Prize: The Epic Quest for Oil, Money, and Power, New York: Touchstone Books, 1991 notes that while the U.S. was 25% more oil efficient and 32% more oil efficient in 1985 than in 1973, the Japanese their energy efficiency by 31% and their oil efficiency by 51%. McDermott, D. ("Economists don't see a big inflation threat from oil"The Wall Street Journal 3/26/99) notes the U.S. is becoming less reliant on oil.
  • British Petroleum's carbon reforms are noted by Brown, L. et al., "Vital Signs 1998," Worldwatch Institute, 1998 and Rosen, Y., "BP Head Tells Oil Industry to Heed Emissions Issue," Reuters, 1/24/98
  • A brief overview of carbon reinjection is given in Schneider, D., "Burying the Problem?" Scientific American, Jan 1998.
  • In The Economist, "Science and Technology-War, Words," June 14-20, 1997, it is noted that government spending on renewable energy was only $878 million in 1995 compared with the $5 million spent on research for nuclear power.
  • Brown, L. et al. ("Vital Signs 1998," Worldwatch Institute, 1998) reported that wind power was up 26% in 1997.
  • Alternative fuel systems are mentioned in Tate, R. "Entrepreneur Drives to Sell Workable Substitute for Gas," the Wall Street Journal, 8/25/99; the Environmental News Network, "Cleaner Fuels on the Horizon," 1/12/98; and US Department of Energy, Carbon Management: Assessment of Fundamental Research Notes, Office of Energy Research, Department of Energy, Aug 1997.
  • Cleaner mining techniques are discussed in Coghlan, A., "Cleaner Gold Improves Miners' Prospects," New Scientist (April 6, 1996) and A. Coghlan, "Midas Touch Could End Amazon's Pollution," New Scientist (June 27, 1997).