Oil and Gas
Oil and gas continue to be the major energy source worldwide, with rising prices and a booming industry. The huge demand for both energy sources and their high prices lead the oil and gas industry to consider ever more remote and sensitive environments for exploration: Amazon, Artic, off shore tropical seas, frozen wilderness of the Russian far east.
Impacts
Meanwhile the ecological risks of oil and gas exploration are huge:
- pollution of land, air and water through drilling platforms and oil and gas production facilities, flaring installations and refineries;
- serious oil spills, leakages, fires or explosions through ruptures of pipelines, due to earthquakes, other natural causes or sabotage;
- pollution of large sea areas and vast shorelines through oil tanker accidents;
- the continued use of oil and gas, especially oil, accelerates climate change.
Social impacts, too, are severe:
- pollution and infection diseases affect the health of local and (possibly isolated or even uncontacted) indigenous communities, as well as their culture and livelihoods;
- oil and gas companies claiming land of local inhabitants, or polluting it severely deprive the inhabitants of their source of income;
- oil and gas extraction and transportation often contribute to increased conflict, repression and abuse of human rights, especially where the extracting corporations collaborate with military or local militias;
- there is a growing consensus among economists that the disruptive economic effects of oil investment (unaccountable revenues and inadequate distribution of revenues) act to drastically reduce growth and undermine the non-oil economy, as well as often leading to declining governance structures and a weakening of democracy (resource curse);
- At a regional level, oil is frequently associated with greater militarization and conflict – through disputes over the control and ownership of resources, through the use of revenues to purchase arms, and through the targeting of oil infrastructure by armed groups.
Standards
Russian NGOs formulated „Environmental Standards for operations of oil and gas companies operating in Russia“ as an attempt to help oil and gas companies formulate effective corporate environmental policies based on the necessity of ensuring environmental safety and the minimization of negative environmental consequences. The organisations appeal to the organs of federal and local government to identify priorities and approaches in regulating the activities of oil and gas companies in the interests of the long-term sustainable development of the country and its regions and to formulate a plan for the socio-economic development of territories implementing governmental Environmental Impact Assessments and the organization of environmental monitoring.
Brot fuer die Welt developed principles for the conduct of company operations within the oil and gas industry with particular emphasis on ecologically and socially sensitive areas (pdf).
Transparency
Oil and gas revenues are an important source of income for governments of resource-rich, poor countries. These revenues, when properly managed, can serve as a basis for poverty reduction, economic growth and development. However, these revenues do not always benefit communities. As explained above, instead of paying for health and education services, natural resource revenues often exacerbate corruption, conflict and social divisiveness and never reach communities. This was the base for the “Publish What You Pay campaign” an initiative that aims for greater revenue transparency in the resource sector. Publish What You Pay aims to help citizens of resource-rich developing countries hold their governments accountable for the management of revenues from the oil, gas and mining industries.
Companies
Trends in the oil and gas industry are towards concentration: Exxon absorbing Mobil, TOTAL absorbing Elf and Petrofina or Gazprom absorbing Sibneft and Yukos. In terms of financing big oil companies are seen as safe investments and they can relatively easy attract cheap funds from the capital markets. For big and complicated projects like large pipelines or liquefied natural gas plants public financing through development banks or export credit agencies is seen as a strategy to reduce political risks. The money those institutions provide is much less interesting than their political weight.
Civil Society
Organisations, networks, movements working especially on oil and gas:
