Polar Bears, Big Oil may not mix well

This one was easy to spot. First, on April 29, George Bush railed against Congress for failing to open up Alaska’s Arctic National Wildlife Refuge for drilling. Bush effectively was blaming Congress for today’s soaring gasoline prices, insisting that we should be drilling for oil in America to free ourselves from reliance on foreign oil imports.

The next morning, John Hofmeister, president of the U.S. division of Royal Dutch Shell, sided with Bush’s comments on a television news program. One sentence particularly caught my attention. Hofmeister said his company “has won $2 billion worth of high bids for the Chukchi Sea — that’s a few years off before we could begin production.” I’d never heard of the Chukchi Sea, and maybe you haven’t either. But remember that name.

Then came the clincher. The same day, a federal judge ordered the government to declare by May 15 whether polar bears should be listed as a threatened species. The ruling came because the Department of Interior had failed to announce a decision on the status of polar bears by Jan. 9 as required by the Endangered Species Act, contending in court that the case was “too complicated to decide before June 30.” Once an animal is listed, the Fish and Wildlife Service must designate critical habitat for it, placing restrictions on how that habitat can be developed.

Where do polar bears live? On ice floes in the Arctic, including the Chukchi Sea between Alaska and Russia. Sea ice is critical to the polar bear, which evolved 200,000 years ago to hunt for seals through air holes in the ice. Now, with global warming, the ice is disappearing. No ice, no air holes, no polar bears; by 2050, unless they adapt unnaturally fast, they may all be extinct.

The Chukchi Sea is the size of New Mexico and Arizona combined, and usually is navigable only about four months out of the year. But with rising oil and gas prices and the disappearance of sea ice, the Chukchi Sea has become increasingly attractive to the energy industry. By violating the law, the administration was able to conduct an auction in February for a record $3.3 billion in offshore oil leases across 30 million acres in the Arctic before the Chukchi Sea could be designated as a critical habitat for polar bears. Not too complicated after all, is it?

The truth is, Big Oil isn’t interested in producing more oil in this country. They just want to bank the rights to it. The Bureau of Land Management has issued 28,776 drilling permits on public land — an increase of 361 percent in the past decade — but only 18,954 wells actually have been drilled.

A recent report from the House Committee on Natural Resources shows companies already hold leases to nearly 68 million acres of federal land and waters where they are not producing oil and gas. Those leases could produce an additional 4.8 million barrels of oil and 44.7 billion cubic feet of natural gas each day, nearly doubling total U.S. oil production and cutting oil imports, all without touching the protected ecosystems in the Arctic.

Why the delay in drilling? Oil companies buy and sell their lease holdings all the time. With prices rising, a billion dollars in lease holdings today can be worth millions more tomorrow — a tidy profit without drilling a well that may not hit. Since it’s less expensive to import oil from producing Middle Eastern fields under existing contracts, there’s no motivation for the industry to drill new wells domestically. The real race is to secure government leases before their competitors beat them to it.

For political leverage, however, Bush couches his rhetoric in terms attractive to consumers, weary of soaring energy prices, in order to pressure Congress. One of his biggest fans, Congresswoman Mary Fallin, said last week to find and develop more reserves is an “immediate solution to rising energy prices.” That’s not true, but it’s part of the propaganda.

Notice that Bush is silent on Boone Pickens’ proposal to accelerate wind and solar energy development. That’s not part of Big Oil’s agenda. ExxonMobil raked in more than $40 billion in profit last year, but invested less than half a percent of those profits in clean energy. Meanwhile Americans send $700 billion of our hard-earned dollars overseas every year that should be invested here at home.

The real power play is in oil and gas speculation. By now, that should come as no surprise. We just hope the polar bears will understand.

- Edmond (OK) Sun, July 17, 2008
- photo courtesy Greenpeace