TPT November 2011

G lobal M arketplace

wrath: for running TV ads “showing pretty pictures of – what else? – wind turbines.”

it for as much as 1,000 miles across the ocean. (“Oil Exploration Under Arctic Ice Could Cause ‘Uncontrollable’ Natural Disaster,” 6 September) The interaction was discovered in large-scale experiments 30 years ago. What it means, Prof Wadhams said, is that the Arctic oil rush is likely to be the riskiest form of oil exploration ever undertaken. Of related interest . . . › Whatever its intentions for Arctic development, Exxon Mobil, the Texas-based oil giant, is doing something right – at least in the eyes of the major American credit rating firm Standard & Poor’s. S&P famously downgraded to AA+ the top AAA status that the US government had held since 1941, on grounds of runaway federal spending. But the AAA rating is a badge of honour in corporate America, as well; and, exclusive of some financial and government- affiliated organisations, Exxon is one of only four firms to hold it. That total is down from 60 top-rated US corporations in the early 1980s. Elsewhere in oil and gas . . . › Speaking to reporters at an Australian Petroleum Production and Exploration Association (APPEA) conference in Perth, Australia’s resources minister Martin Ferguson on 9 August asserted that “the fundamentals of Australia economically are very, very sound.” He said that recent visits to Japan, Taiwan, and Indonesia had confirmed him in the view that regional demand for Australia’s commodities remained strong. Mr Ferguson took note of a record US$443bn in outside investment in major Australian petroleum, iron ore, and coal projects, either underway or on the drawing board. Of particular interest is the Ichthys liquefied natural gas project off the coast of Western Australia, with a final decision to proceed expected by year-end. Ichthys is a joint venture of the Japanese oil company Inpex and the French oil giant Total, which hold 76 per cent and 24 per cent stakes, respectively. At full capacity the project is slated to produce 8.4 million metric tons per year of LNG and 1.6 million mtpy of liquefied petroleum gas. In brief . . . › According to the 60 th annual Statistical Review of World Energy, published by BP Plc, in 2010 developing countries accounted for the biggest jump in global energy demand in 37 years. As fast- growing emergent economies rebounded from recession, energy consumption rose at the fastest pace since 1973. The London-based energy giant reported that the overall 5.6 per cent rise in consumption reflected gains in all regions and in all energy categories. Consumption in the developing world – especially in resource-poor Asian and South American countries – grew last year by 7.5 per cent. Consumption in the world’s richest countries grew by 3.5 per cent, the most since 1984, bringing it back to the level of a decade ago, BP said. The surge last year was led by China, which increased its energy consumption by 11.2 per cent, according to BP. That put China ahead of the US as the world’s biggest consumer of energy, accounting for

Oil and gas The potential riches of the formerly icebound Arctic beckon contenders, portend an ecological disaster On 25 August a six-man team of British explorers became the first people to row to the magnetic North Pole. The group that set out from Resolute Bay in Canada on 29 July had rowed the 450 miles, in a vessel with runners on the underside enabling it to be hauled over the ice, in just under four weeks. While these were very different circumstances from the ongoing Texas experience (See “A Prolonged Drought,” above), the two accounts are linked by the exigencies of climate. The voyage by rowboat was made possible only by seasonal ice-melt in the former permanently frozen Arctic. As reported on the environmental blog Care2.com (5 September), the expedition was mounted specifically to examine the effects of global warming. The rowing crew worked throughout with scientific research partners to collect data on the impact of deterioration of the polar landscape. Late summer was a busy period for Arctic-related news. On 30 August an agreement for joint development of Arctic Ocean hydrocarbon reserves was announced by Russia’s top crude oil producer, Rosneft, and Exxon Mobil Corp, of the United States. The partnership, which includes $3.2bn for exploration in the Kara Sea and the Black Sea, also calls for the establishment, in St Petersburg, of anArctic Research and Design Centre for Offshore Developments, which will be staffed by Rosneft and Exxon employees. Rex Tillerson, the chairman and CEO of Exxon, told Reuters that his company would work closely with Rosneft on Russian energy development. The deal also allows Rosneft the opportunity to gain an equity interest in a number of Exxon’s exploration stakes in North America, including the deepwater Gulf of Mexico and the Texas oil patch. But that is another story; as is the unhappy outcome of a similar initiative with Russian partners by Britain’s BP. For the polar scientist Peter Wadhams, a professor of ocean physics at the University of Cambridge, the main significance of the Exxon- Rosneft deal is the boost it gives to the Arctic oil rush. (It will be recalled that in 2007 the Russian explorer Artur Chilingarov planted his country’s flag beneath the North Pole. “The Arctic is Russian,” he declared at the time. “Now we must prove the North Pole is an extension of the Russian landmass.”) Professor Wadhams, the former director of Cambridge’s Scott Polar Research Institute, is fearful that the global Arctic scramble ahead will entail incalculable peril to the natural environment of the earth. › In an interview with Michael McCarthy, environment editor of the London-based Independent , Prof Wadhams warned that any serious oil spill in the ice of the Arctic, “the new frontier” for oil exploration, is likely to despoil vast areas of the world’s most pristine ecosystem. Oil from an undersea leak would not only be very hard to deal with in Arctic conditions: it would, he said, interact with the surface sea ice, become absorbed into it, and be transported by

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