Roger Baker : Oil Addiction Generates Denial

Political cartoon from the LA Progressive.
Oil addiction generates denial

The major sin of the big oil companies was to get their customers addicted, to set up lobbies to keep them addicted, and to deny the looming shortage problem, including the threat of global warming.

By Roger Baker / The Rag Blog / May 23, 2012

It’s easier to fool people than to convince them that they have been fooled. -- Mark Twain

Denial is a basic symptom of addiction that involves hiding the truth, refusing to talk about the problem, rationalizing, or dismissing the situation -- defensive patterns of behavior that the addicted employ to avoid facing reality. This same principle of denial holds true whether the addiction applies to an individual or to an entire nation.

It is certainly no exaggeration to say that the United States has been a nation addicted to a continuous supply of cheap imported oil for at least the last 35 years. This has been so ever since President Jimmy Carter promised to take a leadership role in breaking our oil habit in 1976. At that time he characterized the U.S. energy crisis as the "moral equivalent of war." The USA has been in denial ever since.

By 2006, our imported oil habit was still growing and caused about 35% of our trade deficit. (See Figure 1 in this link.) Since then, we have been able to produce more oil and cut back on our oil imports (see Figure 3), but now it has risen so much in price that it constitutes about 60% of the total U.S. trade deficit. Transportation, mostly driving, still accounts for about 70% of U.S. Oil consumption, despite the fact that driving has declined slightly after peaking in 2007.

Oilman and President George W Bush, who was in an excellent position to understand such things, openly declared our national addiction in his state of the union address in 2006:

Here we have a serious problem: America is addicted to oil, which is often imported from unstable parts of the world.

From President Carter to President Bush Jr., our imported oil habit became progressively less sustainable, as the cheap oil was used up. If the continuous stream of tankers that export oil from the Persian Gulf region should be interrupted now, the price would immediately rise to a level that would make fuel unaffordable to many U.S. drivers, and to a degree much more painful and disruptive than we experienced in 2008, or in recent months.

Our continuing addiction to Mideast oil accounts for the vast U.S. military force that we have stationed in the Persian Gulf, which region provides a large and growing portion of the world's total oil supply. It is sometimes claimed that because the United States gets most of its oil from sources closer than the Gulf region, we are not highly dependent on this region. However, since the oil market is global, any oil supply interruption in the Gulf region would soon translate to high prices everywhere else. The Chinese would soon bid against the USA for the fuel produced from the Canadian tar sands, etc.

Europe, by comparison, has been been largely shielded from big fuel cost increases by its already much higher fuel taxes. These taxes have forced its drivers to adopt lifestyles that minimize their fuel consumption, and thus protect them more from a global oil price rise.

Whenever the U.S. supply of imported oil is threatened with interruption (or if the U.S. economy should recover much), the global marketplace bids up the oil price, and the politically sensitive price of gasoline will rise in step and depress consumer spending . Whenever the world oil price is high enough, it can cause an economic crisis. In this case global demand may contract sharply, as it did in 2009. The price can never rise for long above what the global oil market can bear.

In 2008 we found that limit as we approached $120 a barrel for oil and $4 a gallon for gasoline. Prices are once again beginning to kill demand in the U.S., but under a slightly lower ceiling, because the economy isn’t nearly as strong as it was in the first half of 2008. Now the ceiling is closer to $100 a barrel.

Young people are more inclined to kick their oil habit

The lower third of the U.S. population by income increasingly cannot afford to drive at all.

As a result, many young people in particular seem to be culturally rejecting car ownership as a lifestyle goal, and are arranging their lives so as not to require cars. According to a new report ,

The average annual number of vehicle miles traveled by young people (16 to 34-year-olds) in the U.S. decreased by 23 percent between 2001 and 2009, falling from 10,300 miles per capita to just 7,900 miles per capita in 2009. The share of 14 to 34-year-olds without a driver’s license increased by five percentage points, rising from 21 percent in 2000 to 26 percent in 2010, according to the Federal Highway Administration.

The road lobby, sprawl developers, and climate change denial lobbies all have a dog in the fight and are happy to support groups that help perpetuate oil addiction denial. The Antiplanner, funded by the Cato Institute, is one prominent voice of denial. This Libertarian think tank, founded by one of the Koch Brothers, is still a bit too independent and they are trying to regain control again.

In fact there is now a wealth of evidence for a deep shift in driving behavior.

America’s transportation policies have long been predicated on the assumption that driving will continue to increase. The changing transportation preferences of young people -- and Americans overall -- throw that assumption into doubt. Transportation decision-makers at all levels -- federal, state and local -- need to understand the trends that are leading to the reduction in driving among young people and engage in a thorough reconsideration of America’s transportation policy-making...

In accord with the nature of politics, unhappy voters tend to seek political scapegoats to blame for their pain at the gas pump. As a nation in denial of addiction, we seek external causes other than our own behavior, dependent as it is on this unsustainable resource. As a nation, we uniquely depend on private vehicles for commuting as an integral part of the U.S. lifestyle.

Given all the media attention it has attracted over the past few years, the public seems to understand that maintaining the U.S. oil supply is important. They also believe that their driving dependency is tied to political policy. This leads to the false hope that, by choosing the right president, their driving might remain more affordable.

Given this situation, it is easy to understand why the recent rapid rise in the cost of fuel has become a political issue. Likewise, the recent modest decline in fuel price might seem to indicate that some kind of mysterious factor other than a natural oil shortage is at play.

It is hard for the average driver to understand that the price of gasoline is closely tied to oil demand on a global scale; that the cost of domestic gasoline is closely linked to the global market price of crude oil, and that its price rises and falls accordingly. Here we can see that the average U.S. gasoline price closely tracks the price of Brent crude, the global benchmark standard, even more closely than it tracks the price of the WTI grade of crude oil still produced in the USA.

Other factors can be important too, like transportation and refining bottlenecks, but the cost of crude oil is primary. Global supply and demand, including our domestic demand that uses more than 20% of the world's crude oil production, are the basic factors that determine what we will pay for our gasoline and diesel fuel. Because of our addiction , we seek scapegoats and seek to deny the need to change our own behavior.


Scapegoats for the right

Republicans make the absurd claim that the federal government and environmentalists have prevented the U.S. oil industry from producing enough oil to lower the price of gasoline. The attempt to portray any possible increase in domestic oil production as being sufficient to significantly lower the global price of oil is ridiculous but certainly attracts media attention.

The truth is that we are in the middle of an oil and gas “fracking” boom widely opposed by environmentalists. This drilling boom has indeed lowered our domestic natural gas price confined to areas within easy reach of gas pipelines, but it cannot much affect the price of oil, since oil is relatively cheaply transported by transoceanic tanker to the highest bidder.

The Republicans still contend that enough of an increase in petroleum could be obtained by increased domestic drilling so that it could lower the price of fuel, even down to the $2.50 a gallon gasoline that Gingrich was promising. Few in the oil industry seriously take these claims seriously, but it is the sort of talk that draws a lot of political attention. Mitt Romney has even called Obama to fire his three top energy advisors.

To be realistic about our current situation, the formerly cheap "conventional oil" that was produced by onshore drilling, which helped the USA win WWII, has nearly all been pumped up and is gone forever outside the Mideast. We now have to rely on much more expensive and hard to produce “unconventional oil" sources, like deepwater offshore wells -- especially since 2005.

In the current global market, the reality is that the fruits of increased domestic production will be sold to the highest global bidder by the multinational corporations like Exxon.

The price of crude oil has increased globally by a factor of five from $20 to $100 in only about the last decade. In terms of the physical infrastructure appropriate to lubricating and growing a profitable world economy, this has had a profound and deep-seated economic effect, an global economic shock that has been felt everywhere as reduced profits throughout the global economy.


Scapegoats for the left

Democrats and critics of the business community naturally choose different scapegoats than Republicans, often on grounds that sometimes seem almost as far-fetched. These scapegoats tend to be the big oil companies, Wall Street oil speculators, and the oil refiners.

There is little that Exxon can now do to reverse the chronic oil dependence that they have done so much to help create and perpetuate. They are in effect the beneficiaries of a once-abundant, but now increasingly scarce resource in an era in which the production cost is steadily rising. As Exxon's own reserves of cheap oil run short, they want to stay in business as middlemen, brokers, refiners, and producers of this increasingly scarce fluid vital to the continued functioning of the U.S. economy.

The major sin of the big oil companies like Exxon Mobil was actually, in large part, to get their customers addicted to their products in the first place, to set up lobbies to keep them addicted, and to deny the looming shortage problem, including the threat of global warming. This was recently detailed in the New Yorker. Obama's response to being blamed for high oil prices has been more political than focused on informing the public of their addiction:

The President’s policies toward the oil industry are not easy to categorize. His actions -- attacking oil-company profits while proposing more oil drilling -- can best be understood as political responses to rising gasoline prices.

Obama is quite willing to take advantage of the unpopularity of speculators as scapegoats . The Democrats don't have a coherent position on energy, but as politicians they still have to represent a public angry about fuel costs. What Democrat could resist blaming Wall Street and commodity speculators for driving up oil prices?

With gas prices continuing to soar, 70 members of Congress on Monday pushed federal regulators to stop excessive oil speculation. The House and Senate lawmakers -- all Democrats -- wrote to the Commodity Futures Trading Commission to urge the agency to immediately put in place limits on traders in crude oil markets and take whatever steps necessary to rein in prices at the pump.

"It is one of your primary duties -- indeed, perhaps your most important -- to ensure that the prices Americans pay for gasoline and heating oil are fair, and that the markets in which prices are discovered operate free from fraud, abuse, and manipulation," the lawmakers wrote in a letter organized by Sen. Bernard Sanders...

The problem with blaming Wall Street speculators is that so much of the oil market is global, like the London exchange. In any case, price hedging is a legal and intrinsic part of a normal market involving buyers and sellers. Nailing down future delivery is the natural inclination of commodity dealers operating in a tight market.

The successful speculators tend to amplify price trends, rather than changing market direction. Speculation is a normal part of the business of airlines, for example, who do a service by anticipating and evaluating future fuel price risk. By anticipating future shortages, they make it hard to deny that there are looming oil supply problems that we urgently need to face.

"The fact is that there really are logistic challenges for Europe to replace Iran as a source of oil, and those challenges are going to translate into a higher price," said James Hamilton, an economist at UC San Diego who has studied past oil-price spikes.

Reasonable voices are no match for addiction denial

Not everyone in Congress has been in denial of our precarious U.S. oil import position. Republican Senator Dick Lugar recently posted an article -- "High gas prices threaten recovery" -- which explained that there is practically no global spare reserve capacity left to cushion a sharp oil price rise, due to an inflexible and increasing global oil demand in conflict with a fixed global oil supply.

Price stability depends on a cushion of excess oil production capacity that could be brought online within 30 days or so if needed. A good rule of thumb is 5 percent of the market -- now about 4.5 million barrels per day -- is a sufficient cushion. Drop much below that, and the market cannot easily cope with planned or unplanned outages...

The cushion today is just 1.4 million barrels per day of spare capacity in a global market of approximately 89 million barrels, according to analyst Bob McNally, of the Rapidan Group. Some estimates are even lower. That thin margin already inflates prices, but it also puts global oil markets on the edge of massive upheaval.

Senator Lugar offered his "Practical energy Plan," which amounts to taking a lot of simultaneous emergency measures to expand domestic fuel production, while reducing consumption. While this is good advice, it would certainly take more time and require more political will than we have available.

However even these kinds of sensible warnings by a moderate Republican Senator are apparently too much for the right-wing oil addiction deniers to tolerate. The Koch brothers, who became super-rich from petrochemicals, helped fund FreedomWorks, part of the opposition that successfully knocked Sen. Lugar out of the Republican primary, and thus removed a respected political moderate.


Little time left to deal with our addiction

Rising gasoline prices should ideally be welcomed as a warning of what is soon to come. One of the keenest observers of the geopolitics of oil and the precarious nature of our U.S. oil dependence is Michael Klare.

Because the American economy is so closely tied to oil, it is especially vulnerable to oil’s growing scarcity, price volatility, and the relative paucity of its suppliers. Consider this: at present, the United States obtains about 40% of its total energy supply from oil, far more than any other major economic power.

We will now have to prepare for major economic changes and high gas prices. Oil and politically sensitive gasoline prices have receded in price the last month, but this is in no way a sign that our lives can return to the cheap oil era of the past. We are busily preparing to fight Iran. The energy wars are heating up globally . The hour is getting late.

Klare now calls on Obama to be honest about the true gravity of our current situation.

President Obama has to be honest with the public. There is no solution to high prices, other than a change in the behavior of our energy use, because there is no cheap oil left on the planet. We have to begin a process of converting to alternative forms of energy or alternative forms of transportation. And he has to be honest.

Will we wake up and face our oil addiction denial in time? As they wisely say, you can evade reality, but you cannot evade the consequences of evading reality.

[Roger Baker is a long time transportation-oriented environmental activist, an amateur energy-oriented economist, an amateur scientist and science writer, and a founding member of and an advisor to the Association for the Study of Peak Oil-USA. He is active in the Green Party and the ACLU, and is a director of the Save Our Springs Association and the Save Barton Creek Association in Austin. Mostly he enjoys being an irreverent policy wonk and writing irreverent wonkish articles for The Rag Blog. Read more articles by Roger Baker on The Rag Blog.]

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Jim Hightower : The Keystone XL Flim-Flam

Valero refinery in Port Arthur, Texas. Image from Nation of Change.
The Keystone XL flim-flam

The dirty little secret that those pushing so urgently for building Keystone XL don't want you to know is that the tar sands oil producers are in cahoots with Texas refineries to move the product onto the lucrative global export market...

By Jim Hightower / Reader Supported News / March 4, 2012

For Rep. Allen West, the skyrocketing price of gasoline is not just a policy matter, it's a personal pocketbook issue. The Florida tea-party Republican (who, of course, blames President Obama for the increase) recently posted a message on Facebook wailing that it's now costing him $70 to fill his Hummer H3.

It's hard to feel the pain of a whining, $174,000-a-year Congress-critter, but millions of regular Americans really are feeling pain at the pump -- especially truck drivers, cabbies, farmers, commuters,and others whose livelihoods are tethered to the whims of Big Oil.

It's an especially cynical political stunt, then, for congressional Republicans, GOP presidential wannabes, and a chorus of right-wing mouthpieces to use gas price pain as a whip for lashing out at Obama's January decision to reject the infamous Keystone XL pipeline.

This friendly Canadian corporation, they cried, would send 700,000 barrels of "tar sands crude" oil per day through the 2,000-mile-long pipeline that it would build from Alberta, Canada, to Texas refineries on the Gulf Coast. "Less dependence on OPEC," they chant like a mantra, "more gasoline for America, lower prices for consumers."

What's not to like?

Well, aside from inevitable environmental damage from pipeline leaks, and the fact that this foreign-owned corporation would use the autocratic power of eminent domain to take land from unwilling sellers along the 2,000 mile route, here's something not to like: The gasoline and diesel that would be made from this Canadian crude would not go to American gas pumps, but to foreign markets.

The dirty little secret that those pushing so urgently for building Keystone XL don't want you to know is that the tar sands oil producers are in cahoots with Texas refineries to move the product onto the lucrative global export market, selling it to buyers in Europe, Latin America and China -- not to you and me.

The pipeline and the toxic crude it would carry across six states would do absolutely nothing to shave even a penny off of the price we pay at the pump.

Already, U.S. refineries are exporting record amounts of the gasoline they make. For the first time in 62 years, America is now a net petroleum exporter. Valero Energy Corp., the largest U.S. exporter of refined petroleum products, is a major lobbyist for Keystone XL.

Along with Motiva (an oil refiner jointly owned by Shell and Saudi Aramco) and Total (a French refinery), Valero has signed secret, long-term contracts with Keystone's owner (TransCanada Corp.) and several tar sands oil producers to bring this crude to Port Arthur, Texas. All three have upgraded their refineries there to process diesel for export.

Adding to Big Oil's enjoyment is the fact that the Port Arthur refineries of Valero, Motiva, and Total are within a Foreign Trade Zone, giving them special tax breaks for shipping gasoline and diesel out of our country.

And adding to the dismay of some U.S. consumers, TransCanada has quietly boasted that Keystone XL would cut gasoline supplies in our Midwestern states, thus raising prices at the pump and siphoning more billions of dollars a year from consumers pockets into the vaults of multinational oil interests.

So, lets tally the score in this Keystone pipeline deal: The American people's environment would be put at risk, foreign nations would get the fuel, pipeline and oil investors would get the tax-subsidized profits, and we'd all stay hooked on deadly polluting oil.

Meanwhile, the financial speculators and supply manipulators who are artificially causing our gasoline prices to rise escape scrutiny, while self-serving politicians (tanked up on Big Oil's and Wall Street's campaign cash) divert attention to the bugaboo of Obama's pipeline decision.

And, yet again, our nation has an excuse to postpone the necessary investments in conservation, alternative fuels, and mass transit that would actually solve the gas-gouging problem.

What's not to like?

[Jim Hightower, a radio commentator, writer, public speaker, and former Texas Agriculture Commissioner, edits the populist newsletter, The Hightower Lowdown. This article was published by Creators Syndicate and distributed by Reader Supported News. Read more articles by and about Jim Hightower on The Rag Blog.]

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Hot Oil! Narco Pirates Smuggle Mexican Petrol into Texas

Hot oil? Petroleum "pipa" with the mark of the Zetas, the infamous drug cartel branching out into petro-piracy. Photo from NarcoGuerra Times.
HOT OIL!

Union crooks, drug cartels and U.S. corporations are stealing billions of bucks of Mexican petroleum.

By John Ross / The Rag Blog / November 16, 2009

MEXICO CITY -- In a catchy photo op staged this past August, officials of the U.S. Department of Homeland Security are pictured handing over a four foot-long government check for $2.4 million USD to Mexican finance ministry officials as recompense for shipments of stolen Mexican oil smuggled into Texas right under the noses of U.S. customs enforcement officers and sold to Trammo Petroleum, a Houston transnational with branch offices in China, Brazil, Egypt, France, the U.K., and Switzerland.

Part of the shipment of purloined petroleum was then sold off to a German BASF subsidiary in Port Arthur for $2.4 million. According to the New York Times, the deal was brokered by one Josh Crescenzi, Rio Grande Valley supervisor for Continental Fuels and a bundler for former Texas oilman George Bush during his 2004 election campaign who is now in a federal protected witness program. Trammo CEO Donald Schroeder has pleaded guilty to receiving stolen property and will be sentenced in December.

The Texas case is, in fact, the tip of a sinkhole that involves tens of millions of barrels of stolen Mexican oil worth billions of greenback dollar bills, U.S. customs enforcement, corrupt oil union officials, dozens of mysteriously "disappeared" oil workers, and a dread drug cartel.

Mexican authorities calculate that more than 2,000,000 barrels are stolen from PEMEX, the national petroleum monopoly, each year by workers, company insiders, and organized crime. A 2007 New York Times investigation estimated that a billion dollars worth of Mexican oil was being siphoned from PEMEX annually through fraud, theft, and clandestine "tomas" ("takes") drilled into company pipelines. Thousands of gallons of jet fuel allegedly wound up in the tanks of drug cartel jets carrying cocaine in from Colombia for transshipment to the U.S.

PEMEX numbers (questionable at best) reveal that more than 1.5 million barrels were sucked out of the oil giant's pipelines in the first nine months of 2009 alone. A Mexican government investigation into one network of oil thieves operating in the Burgos sector along the border in Coahuila and neighboring Nuevo Leon states yielded 740,000 pesos in cold, hard cash and evidence of $46,000,000 USD in stolen oil sales, presumably to U.S. buyers.

The modus operandi of the petrol pirates is simplicity itself: "chupaductos" ("duct suckers") are attached to perforated pipelines and the oil pumped into tanker trucks or "pipas" that sometimes bear the PEMEX logo. Pipa drivers are provided with phony documentation from the Mexican Environmental Secretariat (SEMARNAP) attesting that the contents of the loads they are moving are liquid petroleum waste -- the documentation is apparently good enough to satisfy the curiosities of U.S. customs inspectors.

Some of the stolen crude is processed at clandestine refineries into gasoline that is sold in both Mexico and the U.S. Gas stations in central Mexico, particularly in Puebla state, are ready customers for the hot oil if a recent article in the daily El Universal is to be believed. Major trucking and bus companies buy the purloined gasoline without any questions asked. A May 16th, 2008 raid by federal police agents at offices in Acolman, Mexico state resulted in the confiscation of documentation for dummy companies created to distribute the product.

PEMEX bulletins reported by El Universal establish that nearly half the stolen petroleum (48%) is sucked from pipelines that supply the country's six major refineries -- Mexico, which has limited refining capabilities, sends most of its crude to Texas to be converted into gasoline that is then re-imported for domestic use.

22% of the "tomas" are tapped from two oil ducts feeding the Hector Lara refinery in Cadareyta, a city of 75,000 in central Nuevo Leon. Local papers report that PEMEX has shut down 33 "takes" in the Cadareyta pipeline network so far this year, most recently this past August 30th along the national highway in San Juan, one of dozens of tiny communities that pertain to the municipality. The perforated duct measures 24 inches around which experts say translates to a lot of petroleum.

Who is stealing Cadareyta's oil? One PEMEX investigation suggests the involvement of organized crime, most pertinently the Zetas, a ruthless band of narco traffickers, who began life as the dreaded enforcers for the Gulf Cartel. Noted for their expertise in beheading their rivals, the original Zetas were Mexican Army officials trained in drug war strategies at the Center for Special Forces in Fort Bragg, North Carolina.

Osiel Cardenas Guillen, reputed kingpin of Mexico's notorious Gulf cartel, faces 30 years in a U.S. prison. Photo from U.S. News and World Report.
Bored with protecting the interests of Osiel Cardenas, the Gulf Cartel capo who is now facing 30 years in the U.S. super-maxi penitentiary in Florence, Colorado, the Zetas have gone into business for themselves and are now assigned full-blown cartel status by Mexican drug fighters. More than a dozen Zeta offshoots now operate throughout Mexico and the cartel is diversifying into extortion, kidnapping, pirate goods, and the sale of stolen oil.

With 2000 members, Section 49 of the Sindicato Mexicano de Petroleros de la Revolucion Mexicana (STPRM) which holds the contract for the Cadareyta refinery is notorious for corruption and gangsterism. Up until 2007, the section was controlled by ten brothers named Vega, disciples of STPRM boss Carlos Romero Deschamps. In fact, Hilario Vega, then in his third term as secretary general of Section 49, was considered Romero Deschamps' heir apparent when leadership of the union devolves to northern sections of the STPRM in 2012.

One ex-Cadayreta worker, Tony Cantu, interviewed by the New York Times' Tim Weiner, testified that the Vegas were perfectly capable of killing dissidents to protect their concession -- Cantu now lives in Houston. Hermen Macias, a Cadareyta newspaper editor who dared to cross the Vegas, claims he was repeatedly threatened with death before the union bosses began to mysteriously disappear.

The Vega brothers' enterprise began to unravel some 30 months ago when, on May 16th 2007, David Vega, AKA "El Ganso" ("The Goose") left a union meeting in high spirits with three fellow oil workers -- the four reportedly had been plotting strike tactics if then-upcoming negotiations with the PEMEX refinery division fell through. But David Vega and his three companions never returned home. One unidentified eyewitness to their forced disappearance or "levanton" ("pick-up" in narco parlance) reported that the petroleros were waylaid by a commando of men dressed in black uniforms with no insignias and bullet-proof vests and carrying automatic weapons with grenades strapped to their belts -- an outfit that fits the Zeta dress code -- and spirited off in several large black cars.

The morning after the "levanton," Hilario Vega, the long-time Section 49 boss, received a phone call instructing him to rendezvous with the kidnappers in the parking lot of a Cadareyta Wal-Mart mega-store if he wanted to see his brother alive again. According to his son Josue Vega, Hilario complied and was never seen again.

Some news stories suggest that there were over 100 "levantones" in Cadareyta in 2007 -- the number is imprecise because many families failed to report the disappearances of their loved ones to the police who did not seem very interested in clearing up the cases anyway -- if recent criminal enterprise is any teacher the cops may well have been involved in the crimes themselves. Although an unspecified number of kidnapping victims were eventually allowed to return home, leftist Mexican senator Rosario Ibarra, the founder of the EUREKA Mothers of the Disappeared group, holds a list of 38 refinery workers who remain missing. Ibarra, whose own son, Jesus, a member of the 23rd of September Communist League, was disappeared by government agents in 1976, is a native of nearby Monterrey.

The indifference of local authorities, state and federal prosecutors, Section 49, and the national leadership of the STPRM at the disappearances of 38 oil workers, has been nothing short of sensational. Despite a resolution of the Mexican Senate urged by Ibarra and calling for a thorough investigation, the Federal Prosecutors' Office (PGR) insists it has no new information on the kidnappings and the investigation remains frozen in the cold case file. Even clues supplied by witnesses, such as the license numbers of vehicles used in the "levantones," have evaporated, according to Hilario's son Josue.

The younger Vega complains that, disillusioned by the PGR's lethargy, he contracted a billboard near the Cadareyta airport to display photos of his father and other missing petroleros but the billboard company canceled the contract on the pretext that it constituted "political advertisement." Candidates of Mexico's two most powerful parties, the PRI and the PAN, often advertise on billboards outside the Cadareyta airport.

Two and half years after the mystery "levantones," Hilario Vega's replacement as the interim secretary general of Section 49, Jose Izaguirre, has issued no public statement about his predecessor's disappearance. Izaguirre, who is under federal investigation for selling refinery jobs, makes no bones about his candidacy to become permanent secretary general of the section.

The silence of accomplices extends to STPRM boss of all bosses Romero Deschamps who the surviving Vegas inevitably refer to as "Don Carlos." "Don Carlos and my father were friends for life," affirmed Josue Vega in a recent Internet interview.

Carlos Romero Deschamps succeeded the legendary STPRM czar Joaquin Hernandez Galicia in 1989 after the omni-powerful "La Quina" was arrested and stripped of office on orders from then-president Carlos Salinas in a murderous raid on Hernandez Galicia's stronghold in Ciudad Madero Tamaulipas state -- the body of a police agent freshly gunned down in Ciudad Juarez was purportedly flown into Madero so that La Quina could be charged with murder.

Hernandez Galicia had incurred the now-reviled ex-president's wrath by endorsing leftist Cuauhtemoc Cardenas, the son of Lazaro Cardenas who nationalized Mexico's oil industry back in the 1930s, from whom Salinas embezzled the 1988 presidential election. La Quina reportedly opposed Salinas's plans to re-privatize PEMEX and also had financed a slim volume -- A Killer In Los Pinos (the Mexican White House) -- that revealed how Carlos and his black sheep brother Raul shot and killed an Indian servant during a childhood game of Cowboys & Indians.

The PRI's Carlos Romero Deschamps isn't afraid to send in the muscle. Photo from La Economia.
Carlos Romero Deschamps is a veteran mover and shaker in the ranks of the once-and-future ruling PRI party that after 71 years in power was finally deposed in the 2000 presidential elections by Vicente Fox's rightist PAN party. In a doomed scheme to stymie Fox's bid, the STPRM was used as a pipeline to funnel $110,000,000 USD in illegal contributions from PEMEX operating funds into the campaign coffers of losing PRI candidate Francisco Labastida, the so-called PEMEXgate scandal. Although PEMEX director Rogelio Montemayor was forced to flee Mexico to escape prosecution for the scandal, Romero Deschamps, then a PRI senator, enjoyed immunity that exempted him from prosecution (the "fuero") because he was a member of congress.

The PAN's unexpected triumph in 2000 taught Romero Deschamps which side of the coin the money was posted on and he soon closed ranks with Fox's successor Felipe Calderon in his designs to re-privatize PEMEX. During 45 Senate debates on Calderon's privatization bill, Romero Deschamps was a perpetual no-show despite the key role played by the STPRM in the nationalization process --- a strike by petroleros against the transnational "Seven Sisters" that then controlled Caribbean oil fields resulted in Cardenas's expropriation and nationalization of Mexico's petroleum industry in 1938. PEMEX was created soon after.

Both PEMEX and the STPRM soon fell under the control of the PRI from whose ranks corrupt union leadership emerged. By the oil boom and bust of 1976-82, corruption had become institutionalized and with 90,000 dues-paying members (and another 30,000 contract workers), the union has long been a PRI cash cow.

Like La Quina, Romero Deschamps is not reluctant to send in muscle to silence detractors. As recently as early October, "Don Carlos" dispatched his goons to attack dissident petroleros peacefully protesting outside the STPRM's Mexico City headquarters. Rivals disappear -- the suspected fate of the Cadareyta workers is a case in point -- and some suffer an overdose of lead.

Despite plunging PEMEX revenues as major offshore oilfields like Cantarell play out, Romero Deschamps and his cronies continue to be handsomely rewarded by the Calderon regime for their "cooperation." For years, investigators have sought to determine the dimensions of the pay-offs with which PEMEX buys the STPRM's allegiances. Recent revelations by the Federal Institute for the Freedom of Information (IFAI) indicate that between 2005 and 2007, management gifted Romero Deschamps and the union's executive board with over a billion pesos -- 1,273,588,029 of them to be exact.

In 2007 alone, the oil union boss received 139 million pesos for "expenses." 75 million were issued for two STPRM "fiestas" and 532 million for "travel." Although the destination of these trips was not spelled out, Romero Deschamps, like his predecessor La Quina, seems to spend more time at the craps tables in Las Vegas than he does at STPRM headquarters.

[John Ross will present his latest cult classic El Monstruo -- Dread and Redemption in Mexico City ("a lusty corrido about a great betrayed city" -- Mike Davis) at Modern Times, 888 Valencia Street in San Francisco's La Mision this Wednesday November 18th at 7 p.m. The masses are cordially invited. Ross is scouting venues in the midwest, south, and east coast for his winter-spring 2010 Monster Tour. Write him at johnross@igc.org with ideas.]

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Juan Cole on Dick Cheney's Criminal Irrelevance

Photo: Mark Wilson/Getty Images.
Cheney Worries about Wasting the Sacrifices made in Iraq on behalf of Big Oil
By Juan Cole / July 2, 2009

Dick Cheney reacted to the cessation of unilateral US patrols of major cities in Iraq, saying that he had concerns that the "insurgents" might launch more attacks and that “I would not want to see the U.S. waste all the tremendous sacrifice that has gotten us to this point."

First of all, Cheney didn't make any sacrifices in Iraq. He deferred his own military service five times because he 'had other things to do.' The 'sacrifices' were caused because he purveyed falsehoods to the US public in order to get up that war, hinting around that Saddam was in bed with Usama Bin Laden and telling senators that Iraq was two years away from having a nuclear bomb. So the sacrifices were of other people's children, and his role was merely that of an Aztec high priest cutting the heart out of the victims.

Second of all, from the dawn of time until 2003, there had never been a suicide bombing in Iraq. Iraqis are not essentially violent. Like all human beings, they deploy violence at some points to further political goals. Cheney launched a violent illegal war of aggression on Iraq. And Cheney created the "insurgency" by invidious policies that unfairly disadvantaged the Sunni Arabs in the new Iraq he helped midwife.

Third, Cheney's own administration (it was Bush-Cheney, remember Dick?) that negotiated the Status of Forces agreement under which the cessation of stand-alone US patrols of major Iraqi cities was scheduled for this summer. Cheney is trying to imply that this policy is that of the Obama administration!

Fourth, Cheney kept talking about 'liberating' Iraq and democratizing the Middle East. The patrols are ceasing precisely because the elected Iraqi parliament insisted on it! Cheney only likes democracy when it functions as an elective dictatorship for him and his cronies.

Fifth, Jason Leopold reviews the documentary evidence that Dick Cheney combined his energy task force with planning for an overthrow of the Saddam Hussein regime in Iraq.

Leopold writes,

[An] April 2001 report, "Strategic Policy Challenges for the 21st Century," was prepared by the James A. Baker Institute for Public Policy and the U.S. Council on Foreign Relations at the request of then-Vice President Dick Cheney. In retrospect, it appears that the report helped focus administration thinking on why it made geopolitical sense to oust Hussein, whose country sat on the world's second largest oil reserves.

"Iraq remains a de-stabilizing influence to the flow of oil to international markets from the Middle East," the report said.

"Saddam Hussein has also demonstrated a willingness to threaten to use the oil weapon and to use his own export program to manipulate oil markets . . . The advisory committee that helped prepare the report included Luis Giusti, a Shell Corp. non-executive director; John Manzoni, regional president of British Petroleum; and David O'Reilly, chief executive of ChevronTexaco. . . [the notorious crook] Ken Lay, then chairman of the energy-trading Enron Corp., also made recommendations that were included in the Baker report.

And then Leopold adds is this:

The New Yorker 's Jane Mayer later made another discovery: a secret NSC document dated Feb. 3, 2001 - only two weeks after Bush took office - instructing NSC officials to cooperate with Cheney's task force, which was "melding" two previously unrelated areas of policy: "the review of operational policies towards rogue states" and "actions regarding the capture of new and existing oil and gas fields." [The New Yorker, Feb. 16, 2004]

By March 2001, Cheney's task force had prepared a set of documents with a map of Iraqi oilfields, pipelines, refineries and terminals, as well as two charts detailing Iraqi oil and gas projects, and a list titled "Foreign Suitors for Iraqi Oilfield Contracts," according to information released in July 2003 under a Freedom of Information Act lawsuit filed by the conservative watchdog group, Judicial Watch.

In other words, what Cheney is really worried about is that a US military withdrawal from Iraq on the timetable his administration negotiated with the Iraqi parliament might lead to further instability of a sort that would keep the US oil majors from getting at Iraqi petroleum in a big way. His invocation of the 'sacrifices' made by other people's children on the basis of his hateful manipulations is the ultimate desecration.

For my own account of Cheney, Iraq and Big Oil, see Engaging the Muslim World.

Source / Informed Comment

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The Case for Corporate Accountability: Royal Dutch Shell in Nigeria

Now at last it's time for Shell to atone for my father's death

The son of the executed activist faces the oil giant in a human rights trial this week. He seeks understanding rather than retribution.

By Ken Saro-Wiwa Jnr / May 24, 2009

This week, a US court will hear a case that I and nine other plaintiffs filed against Royal Dutch Shell for its part in human rights violations committed against some Ogoni families and individuals in Nigeria in 1995. For some, the case is already being cast as a bookmark in the struggle for corporate accountability, but to me and the other nine plaintiffs it is all that and more.

Fourteen years ago, Ken Saro-Wiwa predicted that Shell would one day have to account for its actions in Nigeria. "I repeat," he wrote in what would have been his final statement to the military tribunal that was to order his execution, "that I and my colleagues are not the only ones on trial. Shell is here on trial... the company has, indeed, ducked this particular trial, but its day will surely come ... there is no doubt in my mind that the ecological war that the company has waged in the delta will be called to question sooner than later and the crimes of that war be duly punished. The crime of the company's dirty wars against the Ogoni people will also be punished."

My father was prevented from making his final statement to the court and he and eight of his colleagues were tried and executed for their alleged role in the harrowing murders of four Ogoni chiefs including his brother-in-law. The murders divided my family and set Ogoni against Ogoni, providing a convenient excuse for the military regime to arrest my father, detain and torture scores of innocent men and send in a military taskforce whose leader publicly vowed to "sanitise" Ogoni so that Shell could drill oil in my community.

Ken Saro-Wiwa's real "crime" was his audacity to sensitise local and global public opinion to the ecological and human rights abuses perpetrated by Shell and a ruthless military dictatorship against the Ogoni people. The success of his campaign had mobilised our community to say "No to Shell" and to demand compensation for years of oil spills that had polluted our farms, streams and water sources. My father called the world's attention to the gas flares that had been pumping toxic fumes into the Earth's atmosphere for up to 24 hours a day since oil was discovered on our lands in 1958. He accused Shell of double standards, of racism and asked why a company that was rightly proud of its efforts to preserve the environment in the west would deny the Ogoni the same.

In response to his campaign, Shell armed, financed and otherwise colluded with the Nigerian military regime to repress the non-violent movement, leading to the torture and shootings of Ogoni people as well as massive raids and the destruction of Ogoni villages. In an infamous memo, Colonel Paul Okuntimo, the head of the military taskforce sent to pacify Ogoni, boasted that Shell provided the logistics for his soldiers. In one incident, Shell was building an oil pipeline and requested support from the Nigerian military. The pipeline destroyed Karalolo Kogbara's farm and, as she was crying over her lost crops, the soldiers shot her. In another incident, Uebari N-nah was shot and killed by soldiers near a Shell flow station; the soldiers were requested by and later compensated by Shell.

A year after the executions, some of the relatives of what has become known as the "Ogoni Nine" filed a federal lawsuit against Shell in a district court in New York. We felt we would not get a fair hearing in a Nigeria groaning under the very same military dictatorship that had colluded with Shell to violate the human rights of our relatives and our community.

In response Shell, which denied that it encouraged violence against Ken Saro-Wiwa, or other Ogonis, and said it attempted to persuade the Nigerian government to grant clemency to the Ogoni 9, hired the most expensive legal minds to prevent us from holding them to account for their actions in the US. Their filibustering brought 13 years of time, four spent arguing over where they should stand trial.

No doubt Shell will try to present themselves as the victims, whose only interest was to produce hydrocarbons in a "challenging" business environment. But can you be so sure of Shell? This, after all, is a company that, as revealed in an investigation by this paper in January 1996, lied about importing arms to Nigeria. And even its own consultants concluded in a 2003 report that its community development schemes were fanning the flames of conflict in the Niger Delta. Shell declined to publish the results. Moreover, this is a corporation that was widely reported to have misled investors and shareholders in 2004 about the size of its reserves in places like Nigeria.

For that financial violation, the New York stock exchange moved quickly to protect the rights of shareholders and investors and Shell was fined $100m. It took less than two years to hold a multinational corporation to account in a US court for financial violations in a foreign jurisdiction.

And yet it has taken 14 years to bring a case to trial against the same multinational corporation in a US court for human rights violations.

All over the globe, people are becoming better informed about the global economy. People are joining the dots that connect the oil under their farms to the extravagant lifestyles in the west. You can make these connections via cable television in my village even thought there is no pipe-borne water and the electricity mostly comes from a diesel generator. There is increasing awareness of the connections between irreversible climate change and our thirst for fossil fuels. More and more people are now feeling the effects of unregulated corporations.

My father was not against oil exploration and production. He appreciated many of the benefits of capitalism, valued the "can-do" spirit, the innovation and would never deny the right of anyone to seek adequate reward and fulfilment from their risk and sweat equity. But can we continue to put profits before people and the planet? How do we monitor institutions and organisations that have the capacity to operate and organise themselves beyond the regulation and jurisdiction of the current regimes of global governance?

Ken Saro-Wiwa always maintained that Shell would eventually come to see him as their greatest friend. He believed that the day would come when Shell would understand that its social licence to operate is as valuable as its commercial rights. In a competitive and uncertain world where the price of doing business becomes ever more unpredictable, where more players - Russians, Indians and Chinese - are able to compete for drilling rights, it will become ever more important to win the battle for local hearts and minds to advocate for a world run on mutual benefit rather than exploitation.



For the relatives, the trial remains our last opportunity to close this sad chapter in our lives. For 12 years, we have all separately developed strategies to survive, living with the anger and the rage that one's relative was unjustly murdered and that many of the institutions and individuals who were responsible for human rights violations continued not only to get away with murder but also to profit from their crimes.

We have remained dignified while the world has moved on. Few have ever wondered about the emotional or financial welfare of the victims but real lives, real people were destroyed.

In the face of the provocations and psychological trauma of all this, I have tried to maintain a dignified position, worked assiduously to deny myself the right to grieve in order to find a lasting solution to the challenges of the Ogoni and the Niger Delta in Nigeria.

The day after my father was hanged, I was asked my opinion of Shell and I didn't hesitate to answer that Shell was part of the problem and must be part of the solution.

I haven't changed my opinion. I am not interested in retributive justice but a justice that is creative, a justice that enables all stakeholders in this affair to account for and learn lessons from the past so that we can all move forward within a constructive and sustainable framework. We have to remain committed to building the kind of world that ensures that people who live on natural resource-bearing areas are not treated as collateral damage in a senseless race for profit.

With all of its experience in Nigeria, Shell knows that such creative justice is possible and the time for us to move in that direction is at hand.

Source / Guardian Observer

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Big Oil Led the Fight Against the Stimulus Plan

North Carolina millionaire businessman and former state legislator Art Pope is a director of Americans for Prosperity.

Why would an organization funded by oil and gas interests be hostile to the economic stimulus plan? Could it be the $50 billion the bill offers for more sustainable energy alternatives?

By Sue Sturgis / February 16, 2009

The compromise version of the $787 billion economic stimulus plan passed the House and Senate Friday and is expected to be signed by President Obama tomorrow in Denver. Despite Democratic leaders' efforts to reach out for Republican support by dropping various controversial provisions and beefing up tax cuts, the measure passed with no Republican votes in the House and only three Republican votes in the Senate.

Public opposition to the plan was led by a group called Americans for Prosperity, which delivered 400,000 signatures on a petition to the Senate opposing the measure. As the group says in a statement at its nostimulus.com/:

We lost. But we put up a heckuva fight!

We turned what was supposed to sail through with 80 votes and no controversy into a bloody knock-down, drag-out fight.

We showed that Americans won't passively sit by while our future is plundered. Just the fact that the bill shrank in conference committee -- they almost always grow -- showed that we had an impact.

Who is Americans for Prosperity? According to SourceWatch.org, the group was founded in 2003 with money from the Charles G. Koch Charitable Foundation, which is run by the billionaires behind Kansas-based Koch Industries -- the national's largest privately held oil and gas company. Media Transparency reports that the group gets substantial financial support from the Claude R. Lambe Charitable Foundation, another one of the Koch family foundations.

Why would an organization funded by oil and gas interests be hostile to the economic stimulus plan?

Could it be the $50 billion the bill offers for more sustainable energy alternatives?

Among other things, the stimulus bill allocates $5 billion to weatherize more than a million modest-income homes and another $6.3 billion to install energy-saving insulation, windows and furnaces in federally funded housing projects, USA Today reports. It also offers a tax credit of up to $7,500 for families that buy plug-in hybrid cars, and includes $500 million for green jobs training.

Americans for Prosperity has long worked against any government efforts to tackle climate disruption by promoting more sustainable energy. Last year Facing South reported on the group's "Hot Air Tour," which featured a hot-air balloon that traveled around the country with a message challenging what AFP dismisses as "global warming alarmism."

The organization is currently running TV ads in Virginia criticizing state efforts to address climate change. Last week, Gov. Tim Kaine signed a pact with the U.K., agreeing to work to reduce greenhouse gas emissions, research renewable energy and raise public awareness about climate change. Kaine has also championed legislation creating renewable energy tax credits and promoting the use of alternative fuels.

Here's the text for one of the Virginia ads titled "Tell Congress Not to Waste Our Money," which makes clear Americans for Prosperity's hostility to government support for more sustainable forms of energy:

MAN: OK, we're in a recession.

Times are tough and jobs are scarce.

Congress talks about economic recovery, but what are they doing?

Spending billions of taxpayer dollars in the name of global warming and green energy.

Who is going to bail us out and pay our bills? Instead, they will:

... Make energy more expensive

... cost us more to heat our homes

... and regulate our local businesses and our jobs out of existence

No thanks. Congress should stop wasting their time and focus on real problems.

ANNOUNCER (VO): Isn't it time Congress listened to the rest of us and got its science and priorities straight.

Paid for by Americans for Prosperity

One of the directors of Americans for Prosperity is North Carolina millionaire businessman and former state legislator Art Pope. He funds a network of pro-business think tanks that was behind an effort to scuttle efforts to address global warming in North Carolina, as was reported in a 2007 Facing South investigation titled "Hostile Climate."

Americans for Prosperity has also been active on labor issues in North Carolina, where it's fighting the Employee Free Choice Act, which would make it easier for workers unionize. Today the N.C. NAACP is holding a press conference to highlight the fact that the group is a front for big business.

Interestingly, Obama Press Secretary Robert Gibbs said the president chose Colorado as the place to sign the stimulus legislation into law "to highlight some of the investments to put people back to work -- particularly clean-energy jobs."

Source / Facing South / The Institute for Southern Studies

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Documenting the End of the Petroleum Age

Click on arrow to play the 'one-minute times millions' video © 2009 jim otterstrom

A One-Minute Reminder From The Lorax!
By Jim Otterstrom / January 14, 2009

Time is running out for the Petroleum Age...

...and none too soon if you ask me!

Every day I walk past dozens of trucks, big, and bigger, as they just sit there idling, blowing what's left of the world's oil from their exhaust pipes into my face, my lungs, and the biosphere of our planet.

As you read these words, millions of huge trucks, this very minute, are idling away precious fuel in every corner of the world (from oil that people are killing each other over). And it goes on 24 hours a day, while billions of other stench-spewing vehicles speed past in an exponentially spiraling pattern of blind destruction.

A stunning thing to witness as the world reaches peak everything, and descends into cataclysmic resource wars, in the waning days of the short-lived Age Of Petroleum.

In a not too distant future the rusted hulks of shiny behemoths like the one above will be weathering away among the ruins of our civilization much like the statues of Easter Island, and, for any survivors, will be a stark reminder of our supreme foolishness.

Mark My Words...

Source / Earth Home Garden

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Is the Gaza Invasion About Its Offshore Gas Fields?

Interestingly, one of our readers asks in a comment, "This doesn't mean I agree with the invasion of Gaza which seems self-defeating - not because of the numbers killed (though that's awful), but because tactically what is it going to get them?" Well, the answer could lie under the Mediterranean Sea offshore of the Gaza Strip, and Michel Chossudovsky helps us a little by reviewing some fairly recent history.

Richard Jehn / The Rag Blog

War and Natural Gas: The Israeli Invasion and Gaza's Offshore Gas Fields
By Michel Chossudovsky / January 8, 2009

The military invasion of the Gaza Strip by Israeli Forces bears a direct relation to the control and ownership of strategic offshore gas reserves.

This is a war of conquest. Discovered in 2000, there are extensive gas reserves off the Gaza coastline.

British Gas (BG Group) and its partner, the Athens based Consolidated Contractors International Company (CCC) owned by Lebanon's Sabbagh and Koury families, were granted oil and gas exploration rights in a 25 year agreement signed in November 1999 with the Palestinian Authority.

The rights to the offshore gas field are respectively British Gas (60 percent); Consolidated Contractors (CCC) (30 percent); and the Investment Fund of the Palestinian Authority (10 percent). (Haaretz, October 21, 2007).

The PA-BG-CCC agreement includes field development and the construction of a gas pipeline.(Middle East Economic Digest, Jan 5, 2001).

The BG licence covers the entire Gazan offshore marine area, which is contiguous to several Israeli offshore gas facilities. (See Map below). It should be noted that 60 percent of the gas reserves along the Gaza-Israel coastline belong to Palestine.

The BG Group drilled two wells in 2000: Gaza Marine-1 and Gaza Marine-2. Reserves are estimated by British Gas to be of the order of 1.4 trillion cubic feet, valued at approximately 4 billion dollars. These are the figures made public by British Gas. The size of Palestine's gas reserves could be much larger.



Who Owns the Gas Fields

The issue of sovereignty over Gaza's gas fields is crucial. From a legal standpoint, the gas reserves belong to Palestine.

The death of Yasser Arafat, the election of the Hamas government and the ruin of the Palestinian Authority have enabled Israel to establish de facto control over Gaza's offshore gas reserves.

British Gas (BG Group) has been dealing with the Tel Aviv government. In turn, the Hamas government has been bypassed in regards to exploration and development rights over the gas fields.

The election of Prime Minister Ariel Sharon in 2001 was a major turning point. Palestine's sovereignty over the offshore gas fields was challenged in the Israeli Supreme Court. Sharon stated unequivocally that "Israel would never buy gas from Palestine" intimating that Gaza's offshore gas reserves belong to Israel.

In 2003, Ariel Sharon, vetoed an initial deal, which would allow British Gas to supply Israel with natural gas from Gaza's offshore wells. (The Independent, August 19, 2003)



The election victory of Hamas in 2006 was conducive to the demise of the Palestinian Authority, which became confined to the West Bank, under the proxy regime of Mahmoud Abbas.

In 2006, British Gas "was close to signing a deal to pump the gas to Egypt." (Times, May, 23, 2007). According to reports, British Prime Minister Tony Blair intervened on behalf of Israel with a view to shunting the agreement with Egypt.

The following year, in May 2007, the Israeli Cabinet approved a proposal by Prime Minister Ehud Olmert "to buy gas from the Palestinian Authority." The proposed contract was for $4 billion, with profits of the order of $2 billion of which one billion was to go the Palestinians.

Tel Aviv, however, had no intention on sharing the revenues with Palestine. An Israeli team of negotiators was set up by the Israeli Cabinet to thrash out a deal with the BG Group, bypassing both the Hamas government and the Palestinian Authority:

Israeli defence authorities want the Palestinians to be paid in goods and services and insist that no money go to the Hamas-controlled Government. (Ibid, emphasis added)

The objective was essentially to nullify the contract signed in 1999 between the BG Group and the Palestinian Authority under Yasser Arafat.

Under the proposed 2007 agreement with BG, Palestinian gas from Gaza's offshore wells was to be channeled by an undersea pipeline to the Israeli seaport of Ashkelon, thereby transferring control over the sale of the natural gas to Israel.

The deal fell through. The negotiations were suspended:

Mossad Chief Meir Dagan opposed the transaction on security grounds, that the proceeds would fund terror. (Member of Knesset Gilad Erdan, Address to the Knesset on "The Intention of Deputy Prime Minister Ehud Olmert to Purchase Gas from the Palestinians When Payment Will Serve Hamas," March 1, 2006, quoted in Lt. Gen. (ret.) Moshe Yaalon, Does the Prospective Purchase of British Gas from Gaza's Coastal Waters Threaten Israel's National Security? Jerusalem Center for Public Affairs, October 2007)

Israel's intent was to foreclose the possibility that royalties be paid to the Palestinians. In December 2007, The BG Group withdrew from the negotiations with Israel and in January 2008 they closed their office in Israel. (BG website).

Invasion Plan on The Drawing Board

The invasion plan of the Gaza Strip under "Operation Cast Lead" was set in motion in June 2008, according to Israeli military sources:

Sources in the defense establishment said Defense Minister Ehud Barak instructed the Israel Defense Forces to prepare for the operation over six months ago [June or before June] , even as Israel was beginning to negotiate a ceasefire agreement with Hamas. (Barak Ravid, Operation "Cast Lead": Israeli Air Force strike followed months of planning, Haaretz, December 27, 2008)

That very same month, the Israeli authorities contacted British Gas, with a view to resuming crucial negotiations pertaining to the purchase of Gaza's natural gas:

Both Ministry of Finance director general Yarom Ariav and Ministry of National Infrastructures director general Hezi Kugler agreed to inform BG of Israel's wish to renew the talks.

The sources added that BG has not yet officially responded to Israel's request, but that company executives would probably come to Israel in a few weeks to hold talks with government officials. (Globes online- Israel's Business Arena, June 23, 2008)

The decision to speed up negotiations with British Gas (BG Group) coincided, chronologically, with the planning of the invasion of Gaza initiated in June. It would appear that Israel was anxious to reach an agreement with the BG Group prior to the invasion, which was already in an advanced planning stage.

Moreover, these negotiations with British Gas were conducted by the Ehud Olmert government with the knowledge that a military invasion was on the drawing board. In all likelihood, a new "post war" political-territorial arrangement for the Gaza strip was also being contemplated by the Israeli government.

In fact, negotiations between British Gas and Israeli officials were ongoing in October 2008, 2-3 months prior to the commencement of the bombings on December 27th.

In November 2008, the Israeli Ministry of Finance and the Ministry of National Infrastructures instructed Israel Electric Corporation (IEC) to enter into negotiations with British Gas, on the purchase of natural gas from the BG's offshore concession in Gaza. (Globes, November 13, 2008)

Ministry of Finance director general Yarom Ariav and Ministry of National Infrastructures director general Hezi Kugler wrote to IEC CEO Amos Lasker recently, informing him of the government's decision to allow negotiations to go forward, in line with the framework proposal it approved earlier this year.

The IEC board, headed by chairman Moti Friedman, approved the principles of the framework proposal a few weeks ago. The talks with BG Group will begin once the board approves the exemption from a tender. (Globes Nov. 13, 2008)

Gaza and Energy Geopolitics

The military occupation of Gaza is intent upon transferring the sovereignty of the gas fields to Israel in violation of international law.

What can we expect in the wake of the invasion?

What is the intent of Israel with regard to Palestine's Natural Gas reserves?

A new territorial arrangement, with the stationing of Israeli and/or "peacekeeping" troops?

The militarization of the entire Gaza coastline, which is strategic for Israel?

The outright confiscation of Palestinian gas fields and the unilateral declaration of Israeli sovereignty over Gaza's maritime areas?

If this were to occur, the Gaza gas fields would be integrated into Israel's offshore installations, which are contiguous to those of the Gaza Strip. (See Map 1 above).

These various offshore installations are also linked up to Israel's energy transport corridor, extending from the port of Eilat, which is an oil pipeline terminal, on the Red Sea to the seaport - pipeline terminal at Ashkelon, and northwards to Haifa, and eventually linking up through a proposed Israeli-Turkish pipeline with the Turkish port of Ceyhan.

Ceyhan is the terminal of the Baku, Tblisi Ceyhan Trans Caspian pipeline. "What is envisaged is to link the BTC pipeline to the Trans-Israel Eilat-Ashkelon pipeline, also known as Israel's Tipline." (See Michel Chossudovsky, The War on Lebanon and the Battle for Oil, Global Research, July 23, 2006)

Source / Global Research

Thanks to Jeffrey Segal / The Rag Blog

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A Practical Guide to Stopping the BushCo Oil and Gas Public Lands Selloff

A view of Dinosaur National Monument. Photo source.
'Direct action gets the goods'
By Amy Goodman / December 24, 2008

Tim DeChristopher is an economics student at the University of Utah in Salt Lake City. He had just finished his last final exam before winter break. One of the exam questions was: If the oil and gas companies are the only ones that bid on public lands, are the true costs of oil and gas exploitation reflected in the prices paid?

DeChristopher was inspired. He finished the exam, threw on his red parka and went off to the Bureau of Land Management land auction that the Southern Utah Wilderness Alliance called "the Bush administration's last great gift to the oil and gas industry." Instead of joining the protest outside, he registered as a bidder, then bought 22,000 acres of public land. That is, he successfully bid on the public properties, located near the Arches and Canyonlands National Parks and Dinosaur National Monument, and other pristine areas. The price tag: more than $1.7 million.

He told me: "Once I started buying up every parcel, they understood pretty clearly what was going on ... they stopped the auction, and some federal agents came in and took me out. I guess there was a lot of chaos, and they didn't really know how to proceed at that point."

Patrick Shea, a former BLM director, is representing DeChristopher. Shea told the Deseret News: "What Tim did was in the best tradition of civil disobedience, he did this without causing any physical or material harm. His purpose was to draw attention to the illegitimacy and immorality of the process."

There is a long tradition of disrupting land development in Utah. In his memoir, "Desert Solitaire," Edward Abbey, the writer and activist, wrote: "Wilderness. The word itself is music. ... We scarcely know what we mean by the term, though the sound of it draws all whose nerves and emotions have not yet been irreparably stunned, deadened, numbed by the caterwauling of commerce, the sweating scramble for profit and domination."

Abbey's novel "The Monkey Wrench Gang" inspired a generation of environmental activists to take "direct action," disrupting "development." As The Salt Lake Tribune reported on DeChristopher: "He didn't pour sugar into a bulldozer's gas tank. He didn't spike a tree or set a billboard on fire. But wielding only a bidder's paddle, a University of Utah student just as surely monkey-wrenched a federal oil- and gas-lease sale Friday, ensuring that thousands of acres near two southern Utah national parks won't be opened to drilling anytime soon."

Likewise, the late Utah Phillips, folk musician, activist and longtime Utah resident, often invoked the Industrial Workers of the World adage: "Direct action gets the goods."

More than just scenic beauty will be harmed by these BLM sales. Drilling impacts air and water quality. According to High Country News, "The BLM had not analyzed impacts on ozone levels from some 2,300 wells drilled in the area since 2004 ... nor had it predicted air impacts from the estimated 6,300 new wells approved in the plan." ProPublica reports that the Colorado River "powers homes for 3 million people, nourishes 15 percent of the nation's crops and provides drinking water to one in 12 Americans. Now a rush to develop domestic oil, gas and uranium deposits along the river and its tributaries threatens its future."

After questioning by federal authorities, DeChristopher was released.

The U.S. attorney is currently weighing charges. DeChristopher reflects: "This has really been emotional and hopeful for me to see the kind of support over the last couple of days ... for all the problems that people can talk about in this country and for all the apathy and the eight years of oppression and the decades of eroding civil liberties, America is still very much the kind of place that when you stand up for what is right, you never stand alone."

His disruption of the auction has temporarily blocked the Bush-enabled land grab by the oil and gas industries. If DeChristopher can come up with $45,000 by Dec. 29, he can make the first payment on the land, possibly avoiding any claim of fraud. If the BLM opts to re-auction the land, it can't happen until after the Obama administration takes over.

The sales, if they happen, will likely be different, thanks to the direct action of an activist, raising his voice, and his bidding paddle, in opposition.

[Amy Goodman is the host of "Democracy Now!," a daily international TV/radio news hour. Denis Moynihan contributed research to this column.]

Source / Seattle Post-Intelligencer

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Larry Ray : Post-Election Kibbles 'n Bits

'A presidential campaign produces a mother lode of ideas. One learns to keep a pad and pen handy.'
By Larry Ray / The Rag Blog / November 11, 2008

Every reporter or writer has story ideas and scrawled words left in their notebooks after extended major news events. The daily news focus is ever changing. Wars, global warming, killer hurricanes, and of course, politicians and political campaigns. A presidential campaign produces a mother lode of ideas. One learns to keep a pad and pen handy. It is not possible to use each idea you jot down as a central theme for an article. But it always seems a shame to let them just fade away because the hot theme du jour has changed from wayward politicians caught flagrante delicto, to deadly earthquakes in California.

So, here are some of my recent sketchy notes plumped out into mini-articles. We are in a recession, so best to use everything in the pantry.

America's veterinarians are reportedly getting an income boost since the campaign is over. Sarah Palin cost them untold dollars in potential exam and treatment fees because, as one Vet observed, "Damn, that woman has a voice that would worm a dog at thirty yards!" And sure enough, soon as her nasal twang quit filling America's living rooms, dogs again started dragging their butts across those same living room floors about a week after she packed up her designer duds and returned to Alaska. The dogs are reportedly lots happier having the vet worm them than the moose mom.

Continuing the pet theme . . . Billions of American taxpayer's dollars have been shelled out to "rescue" huge Wall Street firms because of lax Federal oversight allowing greedy management to royally screw up. But there is no such thing as a Chagrined CEO. Soon as the cash was deposited in their depleted tills what did do they do? Go into the conference rooms of their posh high rise office digs and start planning how to get a grip and tighten things up? Oh, no. The almost-on-the-rocks mortgage and insurance moguls booked thousand dollar a night rooms at distant posh resorts and flew the whole management staffs there from Wall Street . . . first class. Poolside penitence. Between spa treatments, lobster niblets and lots of Dom Perignon they discussed how to best spend all the new money we just gave them. A TV news investigative team followed and caught them red-handed. That night America saw the AIG hotshots poolside, sipping drinks with little umbrellas in them. Outrage! Fire them all! (this call for their heads lasted for two, maybe three days)

Then, only a few weeks later, the Fed gives them another 80 billion or so of bailout money to keep their doors open, and guess what the top AIG managers did? A bit of conference room contrition? Not on your life. They kept the doors open at AIG so they could dash out of them again and fly off first class to yet another poolside executive "workshop." Again they were caught by waiting cameras. We see them on the nightly news stonily walking away from a reporter's microphone as they are asked why they are pissing away all our money.

This should be called the "Bad Dog" syndrome. These hedge fund hotshots are basically peeing on America's rug, over and over just like the family's pedigreed pooch, who despite threats and attempts to change his behavior, continues to pee the carpet. The pooch just won't learn, but at least he displays a slinking, hang dog indication that he knows it is wrong. Ever see a hang-dog sub-prime hotshot? When they talk about having a leg up on everyone else, we now know what that really means.

Finally, I was playing with the idea of the nation's self-service gas stations all of a sudden feeling the pinch of the recession with gasoline dropping from four bucks to less than two bucks. Regular gas at the Exxon station near my house has always been lots higher than the big discount station across the street from it. Now they're having a gas-war with just pennies difference in their prices. Today the discounter had regular for $1.95 and Exxon had it for $1.97. Lots of readers are too young to remember, but when Exxon was Esso, all the stations had a gimmick to get you to buy gas at their pumps. You stayed in the car while an attendant came out, asked you how much and what grade of gas he could put in your tank. Then he checked the oil and cleaned the windshield while the gas was pumping. If you got a fill up, you got a free dinner plate or coffee cup. The idea was to get you to return and eventually get a service for six of dinnerware. Wonder if Exxon and Chevron will be forced to actually compete for business in the coming couple years of recession? There would be no trouble filling the station attendant jobs. But I wonder if folks will have any use for the dinner plates?

[Retired journalist Larry Ray is a Texas native and former Austin news anchor. He also posts at The iHandbill.]

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