Posts tagged ‘oil’
On October 10, 1931 it was the Western Star’s solemn duty to report some sad news. The news had reached Roma from Longreach that Mr Arthur Moore, superintendent of Longreach’s Oil Bore had been killed in an explosion. Known as a careful man who rarely took a drink and who was intimate with the science of boring for oil, his death was a mystery.
From reading Moore’s log books, the coroner deduced he was making a third attempt to shoot the bore and had a consignment of caps newly arrived from Brisbane and a metre-long torpedo with six plugs of gelignite. The mixture exploded prematurely as he tried to place a battery cap. It was likely a faulty explosives timer concocted with a pocket watch brought an end to the life of one of Roma’s great but unheralded oil men.
Arthur Moore was an Englishman, born in Lime Regis, Dorset in 1876. How he spent his early years is not known but he arrived in Australia in 1910 thirsting for adventure in a new land. He entered into the service of the International Boring Company and was posted across Queensland boring artesian water for the state’s growing demands. Aged 40, he signed up in 1916 for the AIF and went off to Europe with the newly formed Australian Flying Corps.
After the war finished he stayed on in England to train in oil development. On his return he came to Queensland’s growing oil capital: Roma. Here he was placed in charge of the government oil bore on Hospital Hill in 1920 as the first non American to hold this position. It was Moore who released a big flow of oil at QG Number 4 well while removing casing and this was the first oil to be condensed in Roma.
It was here he met local woman Esther “Essie” Nind, the only daughter of two well-known Roma residents. Moore married Essie in 1921 aged 45 (she was 27) and they had one daughter. After visiting America, Moore was convinced there was oil in commercial quantities in Roma. “Prospecting in Queensland,” he said in 1923, “should be carried out on the same type of plant used for drilling artesian water.”
In 1924, the Western Star reported Moore was made manager of the newly formed Queensland Petroleum Limited who secured prospecting permits over Forest Vale and Mitchell Downs. Moore was hired to be superintendent for three years Moore also went to Texas to learn more about drilling and later took charge of drilling operations in New Guinea. Roma’s booming oil business lured him back in 1928 to become manager of Roma Cornwall Dome oil operation until it went bust.
Moore went back to England where he was accepted into the Institute of Petroleum Technologists of London. He would also drill in New Zealand before heading to Longreach. He was remembered as one of the first non Americans to be feted in the field of drilling and someone who kept meticulous notes on all aspects of oil exploration.
The governing Scottish National Party put the cat among the constitutional pigeons with their announcement on 10 January they would hold a referendum in autumn 2014. The referendum will ask two questions. The first is whether there should be an extension of the powers and responsibilities of the Scottish Parliament, short of independence; while the second asks whether the Scottish Parliament should “also have its powers extended to enable independence to be achieved”.
In many respects, the controversy over the referendum is a storm in a tea-cup. All the polls suggest that voters will turn down the proposal. YouGov’s polling from 1990 to 2009 show support for full independence hovering around the high 20s to low 30s percentiles. A clearer majority – though never more than 60 percent – are happier with more tax raising powers for the existing Scottish parliament created in 1999. The referendum that created that parliament two years earlier showed most Scots wanted power over their own taxes (currently they can vary the basic rate of personal income tax by a maximum of 3p in the pound). The issue with that was as First Minister Alex Salmond said in October 2010, “there is no point in being a pocket money parliamanet when the pocket money stops.”
The 2011 study of Scottish attitudes showed 70 percent of the population saw themselves as Scottish first compared to about 15 percent who thought they were British. The study also showed that support for increased devolution is also on the up but there was a lot of ambiguous findings on specifics that show there is much to play for. Specific questions on who should pay for what and by what amount narrowed opinion in a way that was rather different than the ungranulated question of whether you support nationalist or unionist.
Opinion is also divided as to whether Scotland would do better alone with its annual £6.5b North Sea oil wealth. According to Michael Moore, the secretary of state for Scotland, the year on year variations of oil prices in 2011 were better managed in a UK wide economy where Scotland could share in the risks as well as rewards. But Scottish finance secretary John Swinney disagreed saying Scotland contributed far more to the UK Exchequer than its share of population which underlined the strength of Scotland’s finances and the opportunities of independence. Scottish opinion polls consistently support the latter view with most Scots thinking those south of Hadrian’s Wall do better from the Union than they do.
Yet opinion polls are less clear on the economic benefits of independence. Most people think they would pay slightly more tax under an Edinburgh administration and there is no consensus on whether the nation would be better off financially. The debate reflects a strong and complex intertwining of English, Scottish and British traditions that make most Scots slightly ambivalent about their nationality.
Unlike the Irish Act of Union a century later, the English-Scottish Act of Union of 1702 was a genuine marriage of near-equals. Scottish kings had sat on the throne of England for over a hundred years (until ousted by the Glorious Revolution). Scotland was still the minor party in the marriage, and as in the case of Ireland, bribery was needed to get the Act passed in Edinburgh. Scotland was still reeling from the economic catastrophe of the Darien Scheme which hoped to set up a Scottish colony in Panama. But the Act of Union was good for Scotland; it gave its economy free trade with England and led directly to the Scottish Enlightenment of the mid 1700s. Thinkers like David Hume and Adam Smith had an immense effect not only on Scotland but on the newly United Kingdom and beyond.
Scots became a driving force in the new British Empire, despite the continued rebellions of the highlanders. The lowlands were transformed by the Industrial Revolution with linen, coal and steel and a massive financial centre. Glasgow became a powerhouse city based on shipbuilding and railways. Scottish cities paid a terrible price for their industrialisation in World War II with extrensive bombing by the Luftwaffe. The deindustrialisation of the post-war years was balanced by the discovery of oil in the North Sea in 1970. Though production has fallen in recent years, a 2010 report said there was still 25 billion barrels of oil in Scottish waters, though they are in harder to reach areas near the Shetlands.
The importance of oil in any border negotiation between England and Scotland cannot be underestimated. 85% of British oil is in Scottish waters. The nationalist site Oil of Scotland claims Westminster moved Scotland’s marine boundaries in 1999 from Berwick-upon-Tweed to Carnoustie “illegally making 6000 miles of Scotland’s waters English.” The website called the Scottish Adjacent Waters Boundaries Order 1999 an “unjust act secretly passed, without the consent of the Scottish People” that took 15% of oil and gas revenues out of the Scottish sector of the North Sea and £2.2 billion out of the Scottish economy. “This lost revenue is more than the proposed £35 Billion Scottish budget cuts for the next 15 years,” the group said.
The moment of silence at the ceremony was marked just before 8am when the first Japanese planes launched their attack. Tuesday, 7 December 1941 would become a day that would “live in infamy” as Roosevelt predictedwhen he responded to the attack. In two hours, 2,400 people would be killed, 1,200 wounded (a shocking discrepancy between the dead and wounded) 20 ships sunk and 164 planes destroyed. Yet the infamy FDR spoke about was not the death toll but the fact the Japanese had lied to the US Government and attacked 30 minutes before they declared war.The cause of Pearl Harbor, as so much of the 20th century’s conflict was oil. Expansionist Japan was reliant on US petroleum to fire its economy but knew the time would come when the alarmist Americans would turn off the tap. The US took a dim view of the 1931 Japanese invasion of Manchuria and the subsequent war with China. Modern China retains so much bitterness about that war it still refuses to call the area Manchuria because it might legitimise Japanese claims. Instead it just called “North East China”.
From their puppet base in Manchukuo, belligerent Japan declared all out war on China in 1937. Relations with the US deteriorated with the USS Panay Incident in 1937 when the Japanese sunk an American ship in Nangking and then the Allison Incident where US consul to Nangking John Moore Allison was struck in the face by a Japanese soldier. Japan said sorry for both incidents claiming it did not see the American flags on the Panay. It did not offer an excuse for Allison but bowed to US demands for an apology.
Yet economic self-interest ensured the US kept supplying oil to Japan until 1941. It wasn’t until July that year they finally placed an embargo as did Britain. Crucially so did Dutch two months later, breaking an existing treaty with Japan and ending the possible supply line of Javanese oil which had supplied 15% of Japanese crude. The embargo put a critical constraint on the conduct of the long-running war in China. Japan was the sixth largest importer of oil in the world. If Japan wanted to resume bombing Chiang Kai-Shek and Mao Zedong’s armies, it would have to grab oil for itself and the East Indies was the easiest target.
While Pearl Harbor was a shock, the war between US and Japan was no great surprise. A majority of Americans expected war in Asia especially in the Philippines which held many strategic American interests. But Japan had other ideas. It was well aware it could not cope with planned American expansion of the Navy. The 1940 Two-Ocean Navy Act (sponsored by two Democrats Carl Vinson of Georgia and David Walsh of Massachusetts) planned to expand the size of the US Navy by 70%. Japan could never match this so struck a blow early before the Vinson-Walsh ships came off the assembly line.
An attack on Pearl Harbor, the Japanese believed, would also neutralise the existing Pacific Fleet to give Japan free reign to take Jakarta. Then the Americans would sue for a peace profitable to Japan. That this was flawed thinking is obvious in retrospect as was their complete failure to work out how the US would respond. Yet as a plan it no woollier than the thinking that led to another oil war while the execution was just as striking.
The 1941 attack was led by submarines. Five midget submarines came within 20km of the coast and launched their charges at 1am. At least four of them were sunk. Then the planes struck. There were almost 200 of them in the first group. A second wave of 170 flew closely behind. They were picked up by newly established radar on the northern tip of Oahu but misdiagnosed as a returning US crew and its immense size was not passed on to headquarters. At 7.48am they arrived at Pearl Harbor. The immediate target of the first wave was the battleships.
Japan believed that by targeting the battleships they would remove the biggest status symbols from the Navy. While they succeeded, they badly misread the importance of the technology. The sinking of one battleship the USS Arizona caused half the death toll on the day. Ten torpedo bombers attacked the ship. After one bomb detonated in the Arizona’s ammunition magazine, she went up in a deafening explosion. 1,117 of the 1,400 crew were killed instantly and the fire took two days to put out.
The second wave had various targets including hangars, aircraft, carriers and cruisers. After 90 devastating minutes, half the planes on Oahu were destroyed. A planned third wave to knock out Pearl Harbor’s remaining infrastructure was called off which Admiral Chester Nimitz admitted could have postponed US operations for another year. But Japanese Admiral Chuichi Nagumo refused because of likely casualties and a need for night-time operations.
Despite this lapse, the Japanese did not rest on their success. Hong Kong was attacked a day later as were US territories Guam and Wake Island. The Philippines, a commonwealth of the US at the time, was also invaded on 8 December. The same day Japanese troops made an amphibious landing at Kota Bharu in north-eastern Malaya, and six points along the south-east Thailand, an invasion ended by an armistice which allowed Japan to use Thailand as a base to attack Malaya. Malaya had rubber and was the obvious dropping off point to access Dutch oil in soon-to-be Indonesia.
Only the US, Iran and Romania exported more oil than the East Indies but the profits went to Amsterdam and Royal Dutch Shell not Jakarta. Borneo was another victim of the 8 December attacks threatening the oilfields of Kalimantan. The rest of the island archipelago quickly fell and would remain in Japanese hands until 1945 while the war was fought elsewhere. The three aircraft carriers that called Pearl Harbor base were out at sea during the attack and the elimination of its battleships gave the US no choice but to put the fate of the war in its carriers.
While the Europe First policy slowed down the Pacific Conflict it was almost over as soon as it began. A wrathful America armed with its new Navy and massive fighting capacity was never going to forgive Japan’s treachery. By July 1942, America sunk four of Japan’s own carriers at Midway and needed their Indonesian oil, fierce military pride, deadly code of honour and incessant pro-war propaganda to keep the insanity going for another three years.
The Sunni Al Khalifa tribe has ruled Bahrain for almost 200 years, a rule cemented by British overlords and trade-based wealth in the 1800s. The majority Shia did not share in the general prosperity and remained second class citizens despite the implicit and sometimes explicit support of Iran. The discovery of oil ensured British meddling would continue for much of the 20th century. The struggle for supremacy in Bahraini affairs by both Britain and Iran continued until the country gained full independence in 1971. A 1973 constitution promised free elections (though for men only) but this was thrown out two years later by the then-emir Salman al Khalifa.
In the 1990s opposition forces came together to demand reforms from the ageing emir and a return to the 1973 constitution. For six years the streets were plagued with riots which were met by suppression by the regime The intifada did not end until the death of Salman in March 1999. Hamad bin Isa Al-Khalifa succeeded his father and immediately promised to carry out political reforms. On 14 February 2001 a referendum to carry out the National Action Charter to return the country to constitutional rule was overwhelming supported by 98.4 percent of the voters. he 2000s saw important progress including the enfranchisement of women and parliamentary elections in 2006 and 2010. However, key problems remain including discrimination against the Shia and the all pervasive power of the al Khalifa caste.
Problems of power sharing were thrown firmly into the spotlight after pro-democracy demonstrations in Tunisia and Egypt hit the headlines in January. In Bahrain opposition was mobilised to demonstrate on the 10th anniversary of the signing of the National Action Charter on 14 February. Pearl Square in the capital Manama became the epicentre of resistance with protesters calling for political reform and equalisation of the economic benefits of Bahrain’s oil-rich economy. The reaction from the alarmed administration was swift. On 17 February a pre-dawn tank raid on the square killed 5 and injured 230 others. Soldiers placed roadblocks and barbed wire around the centre of town and leaders banned public gatherings.
The effect was to harden resistance. Talk of reform was replaced by talk of overthrow of the hated al Khalifas. The funerals of the dead turned into shrines of martyrdom with talk of 100,000 on the streets – about one eighth of the country’s population. Unity of opposition forces was marred by sectarian clashes between Sunni and Shia. Meanwhile panicky leadership cadres made some concessions by sacking extremist ministers while still authorising a shoot to kill policy on the streets.
On 14 March, the Emir had enough and called for support from his Sunni allies. Led by Saudi Arabia they answered the call. A thousand Saudi troops and 500 UAE police officers crossed the bridge to Manama. The invaders were part of a deployment by the Gulf Co-operation Council, a six-nation regional grouping of Bahrain, Saudi Arabia, Kuwait, Oman, Qatar and UAE. The force immediately set about protecting the oil and gas plants and financial institutions. According to al-Khalifa, the troops were there “to look at ways to help them to defuse the tension in Bahrain.” But no one in the country was under any illusion this was anything but an occupation force to crush the revolution.
There was the inevitable bleating from the West but no sign of action to back it up. Hillary Clinton said Bahrain and its GCC allies were “on the wrong track” but mentioned nothing about the 5th fleet that remains in its Bahrain base protecting US oil wealth in the greater region. The Khalifas may not be loved by their subjects but the White House know a Shia government in Manama would not be accommodating to 4,500 US military personnel in the city. The Americans have nailed their colours to the mast. The Fifth Fleet is not there to create disorder but to preserve it. When the regime does fall, as it inevitably will, the American can have no complaints when they are kicked out.
Abdullah’s bribery will likely keep the protesters at home for now and the illegality of political parties and public protest are a deterrent. Yet resistance to the power of the Sauds is growing slowly. The Saudiwoman blog says the country is “still on the train heading to revolution town.” The young are unhappy with large-scale unemployment and the conservative grip of the religious police, she said. Older generations are fed up with the corruption, nepotism and the disappearance of the middle class.
Activists are calling for protests on 11 and 20 March but may well be frustrated by police. They stymied two attempts to stage protests in Jeddah last month after they arrested 30 to 50 people. Saudi blogger Ahmed al-Omran said authorities were watching closely what people were saying on Facebook and Twitter. “They are anxious as they are surrounded with unrest and want to make sure we don’t catch the bug,” al-Omran said.
Western leaders are also keen the Saudis don’t catch the bug. In 2007 then British foreign office minister Kim Howells infamously talked about Britain and Saudi Arabia’s “shared values”. Meanwhile in October 2010, the US Obama Administration kept the Carter Doctrine alive with the sale of $60.5 billion worth of arms to the KSA which was the biggest arms sale in American history. According to an Israeli study of the sale, the package was totally offensive in nature, with its attack planes, helicopters, and “bunker-buster” bombs, and designed to show the US would stand strongly by its allies. ‘US officials have also begun to refer to the “Persian Gulf” as the “Arabian Gulf,” a hot-button issue for the Iranians,’ the study said.
The financial world is also less interested in the democratic desires of ordinary Saudis than they are in the fate of light sweet crude oil futures. Crude was trading at $97.25 a barrel in electronic trading on the New York Mercantile Exchange yesterday having spiked since the start of the year. This has more to do with Libya and issues in Oman and Bahrain but Saudi Arabia remains pivotal to production with the world’s largest reserves. Saudi Aramco have stepped up production since the Libyan revolution started but as the Financial Times points out, oil-dominated economies create few jobs, “especially if they support a bloated royal family that affects not to understand where a privy purse ends and a public budget begins”.
Abdullah’s successor in the agnatic seniority preferred by that 7000-strong royal family is his half-brother Crown Prince Sultan. Sultan, 82 or possibly 86 is just as old, just as unhealthy and just as corrupt as Abdullah. Behind them comes the conservative autocrat Prince Nayef who abhors the idea of reform. The monarchy survived the 20th century thanks to the black gold they controlled and their alliance with the Wahhabists that control religious affairs. The end of the carbon economy would have killed them anyway but with everyday Saudis unwilling to wait, the days of authority of both these ancient institutions are likely to be numbered.
The blowout of the Deepwater Horizon in a deadly methane explosion six weeks ago killed 11 people, injured 17 others and sank the rig that drilled the deepest oil well ever 9,100 metres below the surface. Thanks to the incredible pressure of the ocean floor, it is now spewing out up to 16 million litres a day for a total of almost 4.2 million barrels of oil since April 20. At the current price of $72 a barrel, it amounts to $290 million of oil in the ocean, not to mention the inestimable environment costs. (photo AP)
Hayward has blundered from one pathetic excuse to another as the damage bill rises. Today, BP still has no idea how to plug the leak. The series of exotically named and increasingly desperate rescue methods it tried have all failed. These included the “Top Hat”, the “Junk Shot” and the “Hot Tap” (which all provided wonderful fodder for Jon Stewart). The latest called the “top kill” failed on Saturday. In this method BP tried to pump large amounts of drilling mud into the blowout preventer faster than pressure of the rising oil and gas could push it back out. It didn’t work and other risky options are now being considered none of which have a great chance of success.
With all conventional and unconventional means proving fruitless, apparently serious organs such as Oil-Price.net are suggesting a subterranean nuclear explosion may be the only solution. They say the Russians have done it at least five times. In Uzbekistan in 1966, the Soviet Union put out a 120 meter tall flame which had been burning for three years fuelled by massive natural gas using a 30 kiloton atom bomb. The explosion sealed the well by displacing tonnes of rock over the spill.
While the nuclear option still sounds preposterous, it may be the only thing between the Gulf of Mexico and Armageddon. A few different perspectives show this is developing into one of the world’s most serious environmental catastrophes. Firstly, there is the view from space which looks as if a gigantic bird has shat on the Gulf. A vast whitened plume is headed straight for the Mississippi Delta and its fragile wetlands could easily be destroyed. Another useful tool is the Google maps app “in perspective” where you can centre the spill on any point in the globe to see just how wide a similar spill would look there. Centred on London the spill takes in all of East Anglia and the south coast across to Bristol.
Centring the explosion on London is particularly apposite as it contains the headquarters of BP. Founded 101 years ago as the Anglo-Persian Oil Company it became one of the largest companies in the world by seizing Iranian Oil for 70 years until it was thrown out by the Ayatollahs in 1979. Consistently named as one of the ten worst companies in the world it has suffered crisis after crisis with its Texas City Refinery explosion in 2005, Prudhoe Bay Alaskan oil spill in 2007 and its hook-up with Russian criminal billionaires in the TNK-BP joint venture.
But it survived them all unscathed. During the Bush era, BP seemed to stand for “Beyond Prosecution”. Deepwater Horizon promised more untold riches for the company. The Gulf rig was in the rich Tiber fields estimated to contain up to 6 billion barrels of oil. BP owns three fifths of Tiber and when it announced the discovery of oil last year, their share price rose 4.3 percent in the middle of the recession.
Now the share market has turned against the British monolith. Shares in the company fell 15 percent yesterday and the FTSE 100 fell by more than 100 points. But London cares only about its profits and is merely worried the crisis “won’t be solved until August” which is the month stockbrokers go on holidays. Nuclear explosion or no, the longer term prognosis for those must live with the consequences is poor. 400 bird species are at risk as are the already threatened loggerhead turtles. Sea birds, dolphins and other mammals could be affected if as is likely, the spill escapes into the Atlantic. The livelihood of poverty-stricken coastal Central Americans is threatened. Fishing and tourism across the region will also take the brunt. On the bright side, it may mean the US’s unquestioning faith in the oil industry is starting to waver.
Americans are slowly awakening to the bitter truth that peak oil has already arrived and is swamping their Gulf.
The 230m-long bulk coal carrier Shen Neng 1 ran aground at Douglas Shoal about 70km east of Great Keppel Island at 5.10pm Queensland time on Saturday. The ship had left the port of Gladstone bound for China with a crew of 23, 65,000 tonnes of coal and 975 tonnes of heavy fuel oil. The ship was off course about 120km east of Rockhampton and in a protected area, well outside the normal shipping channels. The 150 tonne fuel tank has been ruptured and heavy seas are driving the ship further into the fragile reef area.
Shen Neng 1 owners the Chinese COSCO Group is one of the largest shipping companies in the world with over 500 vessels. Queensland Premier Anna Bligh has threatened fines of $1 million for the company and a further $200,000 for the captain for straying into the off-limits area. The owners could also be liable for the multi-million dollar clean up, though as Queensland found out last year in the Pacific Adventurer case, there is an upper limit set by international maritime convention.
In the latest accident, the ship’s captain initially told MSQ no oil had been spilt. The impact, he said, had created one hole in the ship’s lower hull which was 40m away from the nearest oil storage area. The captain said he would try to refloat the ship after midnight. MSQ worked with the Australian Maritime Safety Authority and the Great Barrier Reef Marine Park Authority to coordinate the emergency response. AMSA airlifted surveyors aboard to assess the condition of the ship. Emergency surveillance aircraft inspected the scene at first light. A long-range helicopter came from Bundaberg to take specialist response personnel to the vessel.
At 2am Sunday, the oil advice to MSQ had changed. Now “there was an unknown amount of oil” in the water, though the media release did not say who provided this advice or how it squared with the captain’s earlier statement about the hole being 40m away from oil storage. The new knowledge kicked off a national oil spill response plan. MSQ asked the GBRMPA for permission to use aerial dispersants on the oil leak. Response crews were activated in Brisbane, Gladstone and Rockhampton. MSQ’s vessel Norfolk was dispatched from Heron Island to provide logistical support.
By daylight on Easter Sunday it was clear from the air there were oil patches in the waters south-east of the ship. MSQ said at 8.30am there was “no major loss of oil” so far. The carrier was aground on a shoal and would need salvage crews to get it off. A light aircraft from Rockhampton arrived at midmorning to spray chemical dispersant on the spilled oil. Early arrival was critical as dispersants are most effective in breaking up heavy oil when deployed within the first one to two days.
A second aircraft arrived midafternoon yesterday to spray what MSQ called “a ‘ribbon’ of oil measuring approximately three kilometres by 100 metres.” MSQ staff reported only seeing small volumes of oil in the water in the vicinity of the ship but its persistent nature meant it could take some time to break apart. Modelling showed oil could possibly wash up around the nearby Shoalwater Bay military area within the next two days, depending on weather.
The most recent MSQ update at 6am today reported salvors were aboard the Shen Neng 1 to begin the salvage process. The main engine room was breached, the main engine damaged and the rudder seriously damaged. With reported 2 metre swells in the area, the ship was still moving on the reef causing further damage. The long term consequences to the fragile reef are yet to be fully felt.