Wednesday, 29 February 2012

Dan Sharpe: Oil in Society - Exploring for Sustainability

Dan Sharpe, a second year geology student at the University of Leeds, is our new columnist. A couple of weeks ago he wrote about the contrast between earthquakes in Haiti and New Zealand, and this week he shares some thoughts on one of the things most associated with geoscience - oil. 

In an increasingly populated world the quest for natural resources is reaching unprecedented levels. New technologies and increasing prices have lead to a more efficient extraction of oil and the United States alone consumed nearly 20 million barrels of oil every day in 2009.

As a result of this frenzied exploration, companies have to be more acutely aware of the damage that may occur to the human population of an exploration area. With oil being actively extracted from developing countries such as China, Venezuela and the majority of the middle-east it is obligatory that the major companies ‘give back’ to the areas they are working in. Many only view the bad side of the extractive industries, but with stricter regulations and an increase in moral concern for oil producing countries, much better news is now coming out of this industry.

By no means am I saying there are no downsides however. Headlines were battered with stories from the Gulf of Mexico when BP’s offshore rig leaked in 2010 on an immense scale with up to 5 million barrels estimated to have escaped the pipe. Historical incidents include the 1989 disaster involving the tanker Exxon Valdez or the 2002 Prestige catastrophe involving a Greek ship, but in developing countries spills have been known to slip under the news coverage slightly more smoothly. In 2009, Amnesty International released a statement requesting that the CEO of Shell sort out spills in the Niger Delta claiming that the people in the area are forced to drink contaminated water, catch fish that smell of crude oil and breathe air rich in oil and gas fumes. The full press release can be found here.

It is clear that extraction companies such as Shell, British Petroleum and ExxonMobil have an obligation in modern society to ensure they leave areas the same as they were when they arrived, if not better. Today, most major oil companies have projects in place to do exactly this, and the good that these schemes do is very rarely publicised. Shell have their foundation for example, which is focussed on poverty and environmental issues. Hess has their PRODEGE scheme which aims to develop the education schemes in areas of Equatorial Guinea, Africa. This $40 million program aims to improve schools in the country and, working with the local government, Hess has managed to establish 40 model schools of which 39 are now fully operating. As a side project, the partnership has built latrines and drilled water wells to ensure that students now have safe, drinkable water and proper sanitation.

As we all progress into a ‘greener’ world it is important for oil companies to follow. Contrary to this Shell cut all funding for wind, solar and hydro-electric developments in 2009, explaining that the money would be invested into biofuels instead, an energy source that drives up food prices and increases deforestation say environmental groups.

In a statement released in 2010 however, Chevron announced that over $2 billion would be invested in developing renewable technologies over the next three years, showing that some major companies do still value renewable solutions as a true alternative to fossil fuels. Whether this is true is yet to be seen, but the use of solar panels in remote locations, hydro-electric plants for local sustainability and wind farms both off and onshore could well be viable alternatives for those unable to afford fossil fuel powered luxuries such as cars. With profits of over $6 billion per year these major companies are not short on cash and perhaps, with a little investment, the developing renewable solutions could make be viable alternatives for small, remote, and often underdeveloped communities.

These are clear examples of how an oil company can, and should treat local communities, especially in developing nations. The extractive industries are littered with tortured tales of an old-fashioned past and as we move into another decade of poverty, drought and a lack of literacy or numeracy, it is now the chance for companies to prove that the industry has escaped the wasteful techniques of years ago.