Exxon was responsible for the Exxon Valdez oil spill in 1989. Here, part of the spill in the Chenega Bay, Evans lsland (Prince William Sound). Credit: ARLIS Reference.

By Diego Arguedas Ortiz
SAN JOSE, Jul 17 2015 (IPS)

For decades, executives and decision makers at major U.S. and European fossil fuel companies were aware that carbon dioxide (CO2) emissions caused global warming, but still provided millions in funding to boost disinformation campaigns and sponsor scientists who denied climate change.

As early as 1981, more than a decade before the first meeting of the United Nations Framework Convention on Climate Change (UNFCCC), leaders at oil giant Exxon acknowledged the connection between fossil fuels and climate change.“Their aim was to sell doubt. They don't have to disprove climate change, [they] just have to make people believe there was not consensus." -- Nancy Cole

The revelations emerged as part of a report released by the Washington, D.C.-based Union of Concerned Scientists (UCS), called the Climate Deception Dossiers, which explores the tactics promoted by companies such as ExxonMobil, Shell, Peabody Energy, Chevron and Conoco-Phillips to undermine climate science.

“They were already factoring the risks of climate change in their business as early as 1981, and 34 years later they continue to lie to the people and undermining climate science”, Nancy Cole, Director of Campaigns for the UCS Climate and Energy Program and contributor to the report, told IPS.

The Dossiers show how Exxon and other major companies funded a vast disinformation campaign that included climate deniers, contrarian think tanks and public relations firms, with evidence pointing in their direction as recently as 2015.

“Their aim was to sell doubt. They don’t have to disprove climate change, [they] just have to make people believe there was not consensus,” said Cole.

One of the climate rebukers is Wei-Hock “Willie” Soon, an engineer affiliated with the Harvard-Smithsonian Center for Astrophysics who received more than 1.2 million dollars in big-oil funding between 2001 and 2012 and whose salary relied exclusively on their grants, according to UCS.

For years, Soon’s academic papers have largely overstated the solar influence in global warming and have been methodically discredited by fellow researchers, scientific journals and the Intergovernmental Panel on Climate Change (IPCC), but have been used by conservative politicians and big oil companies to cast doubt on the climate consensus.

A 2014 e-mail by climate scientist Lenny Bernstein, an Exxon employee during the 1980s, revealed that the company was aware as early as 1981 of CO2 emissions. The oil giant decided against exploring the Natuna gas field, off the coast of Indonesia, after being alerted about the massive amount of CO2 trapped in it and the potential for future carbon-cutting regulations.

If exploited, its release would have been the single largest source of global warming pollution at the time, accounting to roughly one per cent of the world’s emissions in 1981.

“In the 1980s, Exxon needed to understand the potential for concerns about climate change to lead to regulation that would affect Natuna and other potential projects,” wrote Bernstein, a veteran of almost 30 years in the industry.

The full UCS report includes over 330 pages of document from around 85 internal company and trade association documents spanning 27 years.

For instance, during the 2009 discussion of the American Clean Energy and Security Act, which proposed a federal carbon emission reduction plan, the American Coalition for Clean Coal Electricity (ACCCE) hired a PR firm which forged letters from diverse organisations to lobby congressmen and women against the bill.

Another major player in the report is the American Petroleum Institute (API), self-proclaimed “only national trade association that represents all aspects of America’s oil and natural gas industry”.

A 1998 internal API strategy document outlines the roadmap devised to confront the ever-growing climate change science and explicitly aimed to confuse and misinform the public, by sponsoring contrarian scientists and targeting teachers, schools and students across the United States.

The document states that victory would be achieved when “average citizens ‘understand’ (recognize) uncertainties in climate science.” IPS reached out to API by e-mail but got no answer.

Their modus operandi mimics that of tobacco companies, according to former U.S. Department of Justice lawyer Sharon Eubanks who led the Department’s successful lawsuit against the tobacco companies.

“It’s like what we discovered with tobacco – the more you push back the date of knowledge of the harm, the more you delay any remediation, the more people are affected,” Eubanks told DeSmog website.

This was echoed by Katherine Sawyer, the International Climate Organiser at the watchdog group Corporate Accountability International, who told IPS that “we wouldn’t let the tobacco industry create tobacco control policy, so why are we letting the fossil fuel industry create climate change policy?” – referring to their participation in U.N. processes.

Some fossil fuel companies appear, at least publicly, to be willing to contribute to a solution. Six major European companies (Shell, BP, Total, Statoil, BG Group, and Eni) sent an open letter to the UNFCCC and the French Government stating they can take faster climate action if governments provide a global interlinked system of carbon pricing.

“If governments act to price carbon, this discourages high carbon options and encourages the most efficient ways of reducing emissions widely,” states their letter.

But the decades-long opposition of fossil fuel companies has eroded their credibility among climate scientists, activists and much of the public.

“For 20 years, the world’s largest polluters have stymied progress in the UNFCCC by exerting undue influence over the treaty process—from direct lobbying to sponsoring the talks themselves,” said Sawyer, recalling that this year’s COP21 climate talks in Paris will be sponsored by corporations like EDF and ENGIE whose coal operations contribute to the equivalent of nearly 50 percent of France’s emissions

“In order for the UNFCCC process to create the meaningful policy our planet desperately needs, negotiators need to kick big polluters out,” she said.

Throughout the world, fossil fuel companies have been hit both in their image and their financial appeal after years of campaigning by divestment groups, organisations that promote getting rid of stocks, bonds, or investment funds linked to high-carbon industries such as coal, oil, and carbon.

“I definitely feel like the fossil fuel divestment movement is David against Goliath,” Perri Haser, lead organiser of the divestment campaign at Dartmouth College in New Hampshire, told IPS. “But here’s the thing about David and Goliath: we know how that story ends.”

A 2013 report highlighted how 90 companies, 50 of them publicly traded, were responsible for almost two-thirds of the world’s industrial carbon emissions over the past two and a half centuries.

That several major oil companies acknowledged risks from CO2 emissions as early as the 1980s doubles its significance since more than half of all industrial carbon emissions from 1750 onwards have been released since 1988.

Edited by Kitty Stapp

Oil rigs and pumps. Credit: Bigstock

By Carey L. Biron
WASHINGTON, Jul 2 2013 (IPS)

A federal judge here on Tuesday struck down a key new regulatory provision that would require large U.S.-listed extractives companies to disclose payments made to foreign governments, a rule that rights groups had long pushed as a way to cut down on corruption in developing countries.

The judgement is being seen as technical, however, and could allow government regulators to tweak and re-issue the rule.

The ruling is seen as a major victory for the American Petroleum Institute (API), a lobby group that sued the U.S. government following the rule’s adoption, last August, on several grounds, including that it would force businesses to divulge proprietary secrets, impose significant costs and infringe on their Constitutionally mandated right to free speech.

“The court has vacated the SEC’s requirement that U.S. companies report competitive information that can be used against them by global competitors,” Harry Ng, API vice president and general counsel, said in a statement.

“U.S. companies are leading the way to increase transparency, but the rule would have jeopardised transparency efforts already underway by making American firms less competitive against state-owned oil companies.”

Ng points out that several major companies under the API umbrella are engaged in the Extractives Industry Transparency Initiative (EITI), a set of standards currently being implemented in around three-dozen countries. Yet the U.S. Congress had felt that the EITI standards were not strong enough (they have since been tightened), and thus mandated the SEC to come up with the extractives payment rule.

The rule is known as Section 1504, part of financial industry overhaul legislation known as the Dodd-Frank Act, signed into law in 2010. As finally adopted in August, Section 1504 requires that all oil, gas and mining companies listed on U.S. stock exchanges engage in annual, public reporting of any payments over 100,000 dollars made to foreign governments.

The rule would apply to around 1,100 companies, and disclosures would have been required starting next year.

Passage of Section 1504 was seen as an important victory by pro-transparency activists and development groups, who suggest that such transparency can crack down on rampant corruption and help to lift the “resource curse” in some resource-rich, governance-poor developing countries, particularly in Africa.

“Needless to say we are incredibly disappointed with this decision, particularly given that the United States has been a leader on this issue through the passage of Section 1504,” Jana Morgan, a Washington campaigner with Global Witness, an advocacy group, told IPS.

“We are now seeing similar initiatives in the European Union and Canada, with transparency in resource payments becoming the new paradigm and the new standard for best business practices.”

Senator Ben Cardin, who co-authored Section 1504, similarly expressed concerns over the potential broader effects of Tuesday’s court decision.

“The U.S. has been at the forefront of the transparency fight, and this decision will delay implementation of vital transparency rules,” Cardin said in a statement.

“Congress was clear in the letter and the spirit of the law that this information should be in the public domain. It’s unfortunate that the court believes that company disclosures to the SEC should remain hidden.”

‘Substantial errors’

The court’s decision revolves around the SEC’s interpretations of the law originally handed down by Congress. In this context, the judge ruled that the SEC had overreached the Congressional mandate in two important ways.

First, the commission’s rule required that company reports on this issue be made public, rather than publishing only, say, summaries of the reports. API-aligned companies had stated in court that changing this element would have cleared up most of their concerns over Section 1504.

Second, the rule did not offer any exemption for companies operating in countries where national laws disallow any such disclosure – Angola, Cameroon, China and Qatar are the four at issue in this case, though this is disputed by transparency advocates.

“The record of comments to the SEC shows clearly that no one has yet correctly identified a single country where Section 1504 disclosures would come into conflict with local laws,” Heather Lowe, director of government affairs with Global Financial Integrity (GFI), a Washington watchdog group, said in a statement on Tuesday. GFI has estimated that illicit financial flows cost developing countries a trillion dollars a year.

Yet companies say Section 1504’s lack of an exemption for national rules would force them to pull out of certain countries, resulting in massive economic costs.

U.S. District Court Judge John D. Bates noted these two points constituted “substantial errors … the commission misread the statute to mandate public disclosure of the reports, and its decision to deny any exemption was, given the limited explanation provided, arbitrary and capricious.”

Because Bates had already struck down the rule based on these two points, he did not offer a decision on the remaining arguments, including the issue of constitutionality. The decision now sends the issue back to the SEC to refashion a new rule, unless the commission moves to appeal the judgement to a higher court.

Contacted by IPS, John Nestor, an SEC spokesperson, said only that the agency is reviewing the decision.

Towards re-enactment?

While rights groups here and internationally are expressing disappointment over the decision, they are noting that the judgement leaves intact significant components at the heart of Section 1504.

“We strongly disagree with the court findings, but that said, the court hasn’t precluded the possibility that the rules will be re-enacted in the same form but with a stronger justification,” Gavin Hayman, the London-based director of campaigns for Global Witness, told IPS.

“Further, we note that nothing in the decision blocks the SEC from requiring public reporting or allows for exemptions from reporting. The oil industry has never been able to clearly show the existence of host country prohibitions against payment disclosure.”

Similar points were made Tuesday by the Washington office of Oxfam America, a humanitarian group that filed a court brief in support of the SEC in this case.

“Nothing in the decision says that the SEC may not require public reporting or deny exemptions – it just says that the SEC needs to use its discretion and provide a fuller analysis,” Ian Gary, Oxfam’s senior policy manager, said in a statement to IPS.

“We disagree with the court’s analysis of the SEC’s justification for not providing reporting exemptions. Despite the court’s conclusions, the SEC balanced the potential costs and benefits of granting exemptions.”

Gary also noted the court’s refusal to rule on the API’s free speech-related argument, but suggested that the judge “did recognise that the Supreme Court has upheld public disclosure requirements as an appropriate approach to regulation.”