Leaving oil in the soil, from Durban's coast to Ecuador's Amazon

The decrepit 40-year-old tanker, MT Phoenix, lost its anchor mooring on July 26, 2011, and was pushed to the rocky shoreline in Christmas Bay, 25 kilometres north of Durban.

By Patrick Bond, Durban

August 2, 2011 -- Links International Journal of Socialist Renewal -- There's no way around it: to solve the worsening climate crisis requires we must accept both that the vast majority of fossil fuels must now be left underground, and that through democratic planning, we must collectively reboot our energy, transport, agricultural, production, consumption and disposal systems so that by 2050 we experience good living with less than a quarter of our current levels of greenhouse gas emissions.

That's what science tells our species, and here in South Africa a punctuation mark was just provided by a near-disaster in Durban -- host of the world climate summit, four months from now -- during intense storms with six-metre waves last week. A decrepit 40-year-old tanker, MT Phoenix, lost its anchor mooring on July 26 and was pushed to the rocky shoreline in Christmas Bay, 25 kilometres north of the city.

The shipwreck is in the heart of a beautiful, albeit class-segregated, tourist and retirement site, Durban's North Coast, that just two weeks earlier held an Association of Surfing Professionals (ASP) world competition, Mr Price Pro. That event boasted some of the best waves ever seen in ASP history, said contestants.

But cold winter swells from marine hell re-emerged just when MT Phoenix was being towed into Durban harbour for confiscation, having lost its engines a few hundred kilometres down the coast. According to Cathleen Jacka of the maritimematters.net website, the incident confounded the South African Maritime Safety Authority (SAMSA), what "with hints at a deliberate beaching; the possibility of a mystery stowaway still hiding onboard; uncertainty as to the true identity of the owners and even that the vessel was scrapped in India last year". A SAMSA official observed that the 15-member crew "seemed inexperienced in the basic actions required to stabilise the vessel's position" and remarked, "It would not be the first time that an unscrupulous shipowner was prepared to sacrifice a vessel in attempt to realise the insured value."

Except that there was apparently no insurance for the MT Phoenix, since Lloyds took it off the books late last year, and allegedly it was on its final trip, from West Africa to India's ghastly ship breaking graveyard. The owner, Suhair Khan of /Dubai, stopped taking calls, leaving South Africans to bear the /risk of 400 tons of oil spilling if the ship broke on the rocks. Estimates of the heroic rescue operation's cost to the taxpayer easily run into the millions of dollars, but thankfully the crew was saved and oil was laboriously pumped ashore.

Offshore drilling in the 'remarkably stable' (sic) Agulhas Current

However another potential oil disaster looms in this very location, thanks to South African government energy bureaucrats. On May 5, the Petroleum Agency of South Africa (PetroSA) began authorising seismic oil surveying by a dubious Singapore-registered company, Silver Wave Energy, in water depths ranging from 30 metres to two kilometres. By comparison, BP's Deepwater Horizon platform in the much calmer Gulf of Mexico drilled 1.5 kilometres down to the seafloor surface.

Silver Wave Energy's primary owner is Burmese businessperson Min Min Aung, who is tight with the junta that rules there, according to reliable reports. Exploitation of oil and gas in Burma's Andaman Sea has long been controversial (my grandfather was deputy warden there during brutal colonial times), and when Unocal -- now Chevron -- built a pipeline to Thailand, it did such enormous damage to people and the environment that local villagers, supported by Earthrights International, successfully sued the firm for US$30 million.

Since 2007, the Arakan islands on Burma's Bay of Bengal coast have been the main site of intense conflict, as Jockai Khaing from Arakan Oil Watch told me last week, and again Aung is a key player. Silver Wave has also been exploring dubious extraction projects in Russia, Sudan, Guinea-Conakry, Indonesia and Iraq, but in spite of sanctions against Burma (supposedly supported by South Africa), Aung received PetroSA's endorsement to explore 8000 square kilometres stretching from Durban to South Africa's main aluminum-smelting city, Richards Bay.

Source: PetroSA, July 2011.

Silver Wave simultaneously announced a $100 million oil search in the fragile Hukaung Valley in north-eastern Burma, and if the company carries out its initial plans, this will threaten local villagers as well as endangered tigers, Himalayan bears, elephants and leopards. Although the area contains the world's largest tiger reserve, according to reporter Thomas Maung Shwe of Mizzima news service, "the Burmese regime has encouraged logging, gold mining, largescale farms and the building of factories inside". As the scandal grew, Silver Wave denied what its own press release had announced, but conceded it would drill near the reserve.

A company this dastardly is a high risk, and to prove the point, Silver Wave's environmental impact document includes a description of the notorious Agulhas Current, which begins at the Mozambique border: "Compared to other western boundary currents the Agulhas Current adjacent to southern Africa's East Coast exhibits a remarkable stability." Huh? In reality, the Natal Pulse races down the Agulhas a half-dozen times each year, pushing 20 kilometres per day. It is one reason Durban's coastline hosts more than 50 major ship carcasses. Creating havoc further south on the Wild Coast, the Pulse contributes to the rouge waves that have sunk 1000 more vessels in what is considered one of the world's most dangerous shipping corridors.

Susan Casey's book The Wave pays Agulhas this respect: "Crude, diesel, jet fuel, liquefied natural gas: oil in all its forms was heartbreaking, infuriating and all-too-common sight in the ocean. Supertankers, behemoths that couldn't make it through the Suez Canal, swung down from the Middle East, took their chances hopping a ride in the Agulhas, and met their share of disasters. Salvagers used every tool at their disposal to prevent the damaged tankers from gushing out their contents, especially in fragile near-shore environments, but sometimes the battle was lost."

Source: Silver Wave submission to PetroSA.

South Africa's petrochemical armpit

If, thankfully, the beaches at Christmas Bay were saved from a spill this week,others have not been so fortunate. Just offshore South Durban's Cuttings Beach, afew kilometres from where I'm writing, we witnessed a significant 2004 oil spill of five tons at the Single Buoy Mooring, the 50-metre deep intake pump that feeds the refineries with 80 per cent of South Africa's crude oil imports. Onshore, corporate pollution standards are so lax that the rust-bucket structures regularly spring disastrousleaks and explode.

Source: South Durban Community Environmental Alliance photo of one 2007 incident.

Daily, poisons are flared onto thousands of neighbouring residents. The Indian, coloured and African communities suffer the world's highest-ever recorded asthma rate in a school (52 per cent of kids), as Settlers Primary School sits next to the country's largest paper mill (Mondi) and between two refineries: one run by Engen, Chevron and Total; and the other, called Sapref, by BP, Shell and Thebe Investments. Sapref's worst leak so far was 1.5 million litres into the Bluff Nature Reserve andadjoining residences in 2001.

Together these refineries can process 300,000 barrels of oil a day, more than any other single site in Africa aside from an Algerian mega-refinery. A new 705-kilometre pipeline from the Durban refineries to Johannesburg will double the existing pumping capacity, an invitation for much more damage here. Delayed two years, the government pipeline project's cost overrun went from $1.4 billion announced in 2005 to $3.4 billion today. Our petrochemical armpit gets smellier, as soaring financial costs add to thesocial and environmental calamaties.

Amazonian oil soils our forest lungs

Because of flying so much, I am feeling an acute need to identify and contest the full petroleum commodity chain up to the point it not only poisons my South Durban neighbours but generates catastrophic climate change. And regrettably, this search must include Venezuela, Bolivia and Ecuador (and from last week Peru as well), for even South America's most progressive governments are currently extracting and exporting as much oil and gas as they possibly can.

Threatened lagoon at Yasuni National Park, Ecuador.

We may even be recipients in South Africa, if the government's plans to build a massive $15 billion heavy oil refinery near Port Elizabeth come to fruition. A $300 million downpayment was announced in the last budget, and full capacity will be 400,000 barrels per day.

From where would this dirty crude come? Two weeks before he was booted from office in September 2008, disgraced South African president Thabo Mbeki signed a heavy oil deal with Hugo Chavez. It appeared a last-gasp effort by Mbeki to restore a shred of credibility with the core group to his left -- the Congress of South African Trade Unions and the South African Communist Party -- who successfully conspired to replace him with their own candidate, Jacob Zuma, as ruling party leader nine months earlier. In those last moments of power, Mbeki fancifully claimed he wanted to pursue Bolivarian-type trade deals, and Chavez told Mbeki, "It is justice ... it will be a wonderful day when the first Venezuelan tanker stops by to leave oil for South Africa." The harsh reality is that the preferred refinery site, Port Elizabeth's Coega, will probably retain its nickname, the "Ghost on the Coast", and Durban will continue to suffer the bulk of oil imports, as BP now actively campaigns against a new state refinery.

Venezuelan dirty crude is akin to Canadian tar sands, and hopefully sense will prevail in Caracas. There is a fierce battle, however, for hearts and minds in both Bolivia -- where movements fighting "extractivism" have held demonstrations against the first Indigenous president, Evo Morales, even at the same time his former UN ambassador Pablo Solon bravely led the world climate justice fight within the hopeless arena of UN Framework Convention on Climate Change negotiations -- and Ecuador where Rafael Correa regularly speaks of replacing capitalism with socialism. Both have "rights of Mother Earth" in their constitutions -- so far untested.

Accion Ecologica

In Quito and Neuva Rocafuerte deep in the Amazon last week, I witnessed the most advanced eco-social battle for a nation's hearts and minds underway anywhere, with the extraordinary NGO Accion Ecologica insisting that Correa's grudging government leaves the oil in Yasuni National Park's soil. Because he was trained in neoclassical economics and hasn't quite recovered, Correa favours selling Yasuni forests on the carbon markets, which progressive ecologists reject in principle.

Accion Ecologica assembled 40 members of the civil society network Oilwatch -- including four others from Africa led by Friends of the Earth International chairperson Nnimmo Bassey from the Niger Delta -- first to witness the mess left by Chevron after a quarter century's operations. Six months ago, local courts found the firm responsible for $8.6 billion in damages: cultural destruction including extinction of two Indigenous nations, and water and soil pollution and deforestation in the Earth's greatest lung -- but Chevron's California headquarters refuses to cough up.

The really hopeful part of the visit, however, was Accion Ecologica's proposal at Yasuni, on the Peruvian border, that $7-10 billion worth of oil in the block known as ITT not be drilled. Part of the global North's debt for overuse of the planet's CO2 carrying capacity must be to compensate Ecuador's people the $3.5 billion that they would otherwise earn from extracting the oil. Leaving it unexploited in the Amazon is the most reasonable way that industrial and post-industrial countries can make a downpayment on their climate debt.

If the UN's Green Climate Fund design team, co-chaired by South African planning minister Trevor Manuel, were serious about spending its promised $100 billion a year by 2020, this project is where they would start, with an announcement on November 28 to put the Durban COP 17 climate summit on the right footing.

Don't count on it. Instead, as usual, civil society must push this argument, in the process insisting on leaving oil in the soil everywhere so that other tankers share what we pray will be the final fate of the wretched ship MT Phoenix: a graceful not rocky retirement.

[Patrick Bond directs the University of KwaZulu-Natal Centre for Civil Society.]


When large reserves of oil were discovered under Yasuní national park, Ecuador offered the world a choice: give us money and we will not allow drilling. Now $60m must be found by December.

    • The Observer,

    Where the foothills of the Andes meet the vast Amazonian rainforest in eastern Ecuador there is a small town called Shell. It's a pockmarked, termite-eaten, one-street place which doubles as a missionary centre and a regional airstrip, but it was here in 1937 that the mighty Shell oil company based its crack Latin American oil-prospecting team. The prize was the vast deposits of crude oil believed then – and now known – to lie beneath some of the densest forests in the world.

    Nearly 75 years later, Shell the company has long left Shell the town and half of Ecuador's estimated nine billion barrels of oil reserves have been extracted. Ecuador has earned $130bn from the oil found so far in its forests and it earns 40% of its income from it.

    But Ecuador now faces a dilemma. Five years ago the state oil company Petroecuador found a massive new oil field containing nearly a billion barrels of oil in Block 31 of the Yasuní national park close to the Brazilian border. The find was equivalent to 20% of all the nation's reserves, worth a minimum $7-10bn.

    The dilemma is that the oil in the Ishpingo Tambococha Tiputini (ITT) field is below one of the most biodiverse areas of the world and to extract it would devastate one of the last great wildernesses.

    Because of its location right on the equator at the junction of the forest and the mountains, Yasuní is one of the last places on earth which is truly undisturbed. As well being home to the the Tagaeri and the Taromenane, two of the world's last uncontacted tribes, the park is thought to have more species of plants, animals and insects per hectare than anywhere else on earth.

    One six-square-kilometre patch of Yasuní – chosen by scientists almost at random – was found to have 47 amphibian and reptile species, 550 bird and 200 mammal species living there. Another patch of land in the park breaks all the world records for bats and insects. More tree species grow in a single hectare of rainforest in Yasuní than in all of north America. A single hectare of rainforest there may contain as many as 100,000 insect species and most of the 2,000 species of fish known to live in the rivers of the Amazon region are believed to be there.

    There have been more species of frogs and toads recorded in the park than are native to the United States and Canada combined; more insect species have been found living on one tree than in all of the United States; more birds seen there than in all Europe.

    What to do with Yasuní was left to oil minister Alberto Acosta. A European-trained economist, he had spent years in the state oil company, was a friend of the president, Rafael Correa, and has long been part of Ecuador's political establishment. At the time he was an elected senator (MP), and president of the national assembly, and had helped rewrite Ecuador's constitution.

    But Acosta admits now that finding so much oil in Block 31 terrified him. "It is one of the last places on earth which is truly undisturbed. It is simply a paradise," he says.

    Acosta is one of the few people ever to have visited Yasuní but his dilemma was how to assess the full costs and benefits of drilling for oil there. On the one hand, the find presented the country with perhaps its last great chance to develop in the traditional 20th-century way, by building roads and industrialising. The money could be used for vitally needed housing, infrastructure, health and education.

    On the other hand, the former oilman knew drilling for oil would push the oil frontier far deeper into the Amazon, release 400m tonnes of climate-changing CO2 and make the total destruction of a vast and pristine area inevitable.

    "To extract oil on that scale from Yasuní," says Acosta, "would lead to contamination, deforestation, extinction of cultures and destruction of social structures. It would need a vast infrastructure including roads, river ports, tracks, airstrips. Villages would have to be constructed, pipelines laid and millions of tonnes of contaminated waste buried."

    In addition, Acosta also knew that the oil industry inevitably attracts corruption, violence and social problems when it works in poor countries such as Ecuador.

    "As with everywhere else in the world, the oil company roads will attract settlers in search of land and work, leading to more forest destruction. You only need to see the crime, pollution and poverty in Ecuador's other oilfields to know that to extract the oil [there] would mean the extinction of a paradise," he says. Acosta and his team, backed by scientists and non government groups, considered the options. "Oil is very important in a country like Ecuador. We have extracted 4.5bn barrels so far, which has given us around $130bn. We are at the top of the curve. We have consumed half and we have half our oil left.

    "But the reality is that oil has not brought development. It has brought us immense contamination and environmental destruction. Since the 1950s the impact on people has been dramatic. Pollution and deforestation bring problems everywhere the oil is. Oil has not solved the problems of Ecuador.

    "I knew the oil industry. I could see the monster from the inside. I began to think perhaps we were poor because of our resources. I called it the curse of abundance. I thought we must have a less extractive economy. We want oil to be used to benefit the country, to transform living conditions."

    Acosta and the ministry prepared two plans: plan A was a revolutionary scheme to leave the oil in the ground in perpetuity in return for half of its value from the rich countries of the world; plan B was for business as usual. For the first time in history, a nation would seriously consider accepting a binding agreement not to extract fossil fuels.

    "We said that Ecuador should approach the world with a deal. We will leave the oil in the ground and save the forest and the people if you, the world, make a financial contribution. If countries and individuals put up just half the "value" of the 960m barrels of oil – around $3.6bn – in Yasuní then Ecuador would guarantee to leave it there," he says. The money earned from the world would then go to protecting Yasuní and Ecuador's other national parks and towards education and hospitals.

    Acosta's thinking was in fact a shrewd response to the economic phenomenon called "oil curse". Experience shows that developing countries who strike oil invariably stay poor. Rather than bringing wealth to many, it enriches a few, fosters corruption, encourages dictatorships and distorts the economies of nearly every poor country it has been found in. The story has been repeated from Nigeria to Sudan, Equatorial Guinea to Gabon and Angola to Venezuela.

    Plan A was received with scepticism in government circles, says Acosta. "But I debated it with the president, showed him the benefits, told him he would be seen as a global statesman."

    But crucially, it was backed strongly by powerful indigenous groups in the country, as well as the many social movements and the public. President Correa went along with it but at the same time has been enthusiastic about the oil.

    Acosta left the government in 2009 and is now a professor at the University of Quito and an open supporter of leaving the oil underground. "One day the president said yes, the next no. I received attacks, people I know lied to defend the interests of the oil companies, and tried to weaken my position."

    But polls showed that 90% of the Ecuadorian people backed Plan A and it was endorsed by government. Last year the UN development programme declared Plan A to be a safe environmental investment, and agreed to administer the fund. If a downpayment of $100m is made by December, the forest and the indigenous groups will be left alone. If the money is not found, then a Chinese company is expected to move in within months and the destruction of Yasuní will begin.

    So far, Chile and Peru have each donated symbolic amounts, Spain has given €1m and Italy has waived €35m in debt relief. Around $40m has been raised, and the Yasuní fund is backed by celebrities, statesman and Nobel prize winners, including Desmond Tutu, Mikhail Gorbachev, Leonardo DiCaprio, Rigoberta Menchú and Muhammad Yunus.

    The options for a life in Ecuador without oil from Yasuní are immense, says Acosta. "The money from the world can be used to protect Ecuador's other national parks, including the Galápagos islands. We have massive renewable energy potential but we use only a fraction of it. We should not export oil but energy. We need a massive reforestation programme. We should be investing in science and teachers.

    "We cannot bring mass tourism [to Yasuní] but we can have scientific research. It would be an opportunity for the pharmaceutical industry. What about making it a sanctuary for humanity and nature? It would be extraordinary.

    "We must understand that oil is unsustainable. We should be an intelligent country and see it in the long term. Climate change is a limit and we can't continue to burn oil. Perhaps we must change our model of life. What we have learned is that while we cannot live without nature, it can live without us."