My Turn: How did climate change affect Shell’s Arctic decision?

  • By Rich Moniak
  • Friday, October 23, 2015 1:04am
  • Opinion

When Shell decided to suspend its Arctic exploration indefinitely, they said it was due to disappointing results, the high cost of the operation and “the challenging and unpredictable federal regulatory environment in offshore Alaska.” The last part of that statement sounds like they’re blaming the federal government, but knowing how oil companies evaluate risks before making such decisions suggests, what Shell knows about climate change may have also been a factor.

Shell didn’t even hint that this contentious issue had anything to do with their decision. Of course, they didn’t mention that oil prices remain mired near $50 per barrel, either. But that’s because 2030 is the earliest Shell could have gotten oil from the arctic to production, had they drilled in the right place. And no one can predict how climate change will impact the oil prices 15 years from now.

On the surface, Shell and their competitors seem to be holding hands with so-called climate change deniers. But they’re not aligned with U.S. Sen. Jim Inhofe, R-Okla., who has called it “the greatest hoax ever perpetrated on the American people.” Nor do they believe the climate is a matter of God’s will. Judging from statements made by a former in-house climate expert at Exxon, for more than two decades the oil companies have understood that human activity is contributing to climate change.

Lenny Bernstein spent 30 years working for Exxon and Mobil. A year ago, he claimed that Exxon’s initial interest in climate change stemmed from a natural gas prospect off Indonesia that dates back to 1981. If that site had been developed, it would have been the largest point source of CO2 emissions in the world.

“Natural resource companies have to make investments that have lifetimes of 50‐100 years,” Bernstein explained in an email sent last year to the director of the Institute for Applied and Professional Ethics at Ohio University. “Whatever their public stance, internally they make very careful assessments of the potential for regulation, including the scientific basis for those regulations. Exxon NEVER denied the potential for humans to impact the climate system. It did question — legitimately, in my opinion — the validity of some of the science.”

This month, the LA Times reported on a similar story that touches Alaskan shores. Ken Croasdale is another former Exxon researcher. He led a team that was responsible for estimating the effect of climate change on Exxon’s Arctic operations. They used NASA and the Canadian Climate Centre models to make their predictions. Since that time — and over the course of two decades — Exxon’s public position has been that both models were unproven and unreliable.

Exxon Mobil spokesman Alan Jeffers responded to the LA Times investigation by explaining their researchers consider a wide range of potential scenarios, including potential climate change impacts such as rising sea levels. So, they admit to have been studying it all these years but they’re not telling anyone what they’ve learned.

Where does Shell’s Arctic decision fit into this? Exxon was “well ahead of the rest of industry in this awareness,” Bernstein wrote. “Other companies, such as Mobil, only became aware of the issue in 1988, when it first became a political issue.” Shell isn’t just one of those other companies. Like Exxon, they must have been studying the effects of climate change before investing $7 billion on offshore leases and exploration in the Arctic.

Climate change science has advanced significantly in the decade since Shell obtained those leases. It’s possible the current scientific consensus will be proven to be reasonably accurate by the time Arctic oil would reach the markets. That means it’s also possible that a team of scientists at Shell played a significant role in their decision to pull out of the Arctic.

If they have been studying it all along, we can be sure of one thing: Like Exxon, they haven’t found any convincing evidence that human activity isn’t contributing to the rise in global temperatures. If they had, there’s no doubt it would have been published for everyone else to see.

The energy products these multi-national corporations sell to society impact the global commons. So they should have no right to keep their climate change research out of the public realm. It’s time for them to tell us what they’ve learned about how burning fossil fuels is impacting our air, oceans and climate.

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