By Frank Mulder
UTRECHT, Netherlands, Jan 4 2016 (IPS)

Venezuela doesn’t want investment treaties anymore if they give investors the right to drag the country before a commercial court. “The system has been set up to break down the nation-state.”

All is not going well for Venezuela. While the country is torn apart by poor governance, poverty and polarisation, it is attacked from the outside by oil firms claiming tens of billions of dollars.

The method these firms use is called ISDS, or Investor-State Dispute Settlement. This is a mechanism by which investors can sue a state by means of arbitration, which is a kind of privatized court. Many lawyers stress the advantage that plaintiffs don’t have to go before a local judge whom they feel they cannot trust. You can choose a judge for yourself, the opponent does the same, and the two of those choose a chairman. They are called arbitrators. The case is heard at a renowned institute, like the World Bank. How could it be more fair?

Biased

But Bernard Mommer, former vice-minister for oil in the time of Hugo Chavez, now the main witness in different claims against Venezuela, has to laugh a bit. “I won’t say that Caracas is a neutral venue. But don’t be so foolish to say that Washington is neutral. The whole arbitration system is biased in favour of investors.”

After Argentina, no country has been sued as much as Venezuela: until 2014 at least 37 cases have been filed against this Latin American state. However, the fine they can expect now exceeds all of the others. ConocoPhillips, a Texas-based oil company, claims 31 billion dollars and seems to be on the winning side. According to critics, that case represents everything that’s wrong with the ISDS system.

Oil dispute

The dispute about oil began in 2006. Under the activist leadership of Chavez, Venezuela decided to nationalise the oil sector. Also, higher taxes were announced. Mommer was responsible for the negotiations with international oil firms about compensation. Most of the 41 companies in the country agreed with the buyout. Two didn’t. Those were the Texas-based companies ConocoPhillips and Mobil (now ExxonMobil).

“When we started with the expropriation, they went for arbitration,” says Mommer. “I didn’t even know that this was possible. For arbitration two parties need to consent, don’t they? How could they sue a state?” But Mommer discovered that Venezuela signed Bilateral Investment Treaties (BITs) in 1991, among others with the Netherlands. Those treaties give all investors from the given country an offer to arbitration if they feel treated unfairly by the host state.

Dutch sandwich

ConocoPhillips and Mobil quickly moved their Venezuelan holdings to the Netherlands in 2006. That gave them the opportunity to claim, as Dutch investors, that the unexpected policy change violated their BIT rights. Together, they demanded 42 billion dollars.

“This is called the Dutch sandwich”, says George Kahale III, a top lawyer from New York, who defends Venezuela in different cases. “You put a Dutch holding in the middle of your company chain and you can call yourself Dutch.”

Companies are not allowed to do this if the dispute already started. ExxonMobil and Conoco said that their move was made independently of the dispute. However, a remarkable message has been found among the Wikileaks cables. In these a representative of Conoco told someone from the American embassy that they “already” moved to the Netherlands to “safeguard their arbitration rights.”

Unlawful

The cases are still dragging on. ExxonMobil has had no luck. The three arbitrators have judged that the expropriation was lawful. ExxonMobil gets compensation, but not much more than what they were offered earlier, around one billion dollars.

But the Conoco case evolved differently. Two of the three arbitrators found the expropriation unlawful. This means that Venezuela has to compensate the firm, not on the basis of the low oil price in 2006, but on the basis of the much higher price at the time of the claim. This will amount to tens of billions of dollars.

This is insane, says Kahale. “The fact is that four out of six arbitrators found that the expropriation was perfectly lawful. And yet Venezuela can expect a mega award.”

Unfair

Talking about fairness: among the Wikileaks cables another juicy anecdote has been found. In a cable from 2008, the Conoco representative tells the American ambassador that the negotiations are going well and that Venezuela is being reasonable. This is in contradiction to what Conoco was claiming in public. Yet the arbitrators – at least, two of the three – now say that they can’t change their conclusion anymore and now have to proceed to the next phase, about the damages.

“In other words”, says Mommer, “the investor can lie. We can’t sue them anyway. They alone can sue us. This shows why Western countries have invented this system. It has been set up to break down the nation-state.”

Disaster

ISDS is structurally flawed, says Kahale. “Who are the judges? They are investment lawyers. Their commercial background shines through in their decisions. Every judge of course always brings his own views to his job. But in arbitration these people are deciding no longer private commercial disputes, but megacases of international significance, with sometimes vital importance for individual states, involving billions of dollars, with very little training in international law.”

Too many, conflicts of interest arise. “You will never see a supreme court judge acting as a counsel in another case. But many arbitrators also act as a counsel. It’s very hard to preside over the legality of something one day, and advocate the same issue the other day. It is natural that I’m holding back in one or the other, depending on which case is more important to me. There are very few checks and balances. Too many mistakes are made.”

Venezuela is fed up with ISDS claims. Soon after the claims were filed, they pulled the plug, not only from the ICSID convention (which acknowledges the World Bank as arbitration court) but also from a number of BITs. The Dutch BIT was the first to be terminated a few years ago. Unfortunately for Venezuela, this treaty contains a clause giving investors the right to arbitration until 2023.

Don’t challenge us

Arbitration can be an elegant method for solving a dispute. But is has developed into an instrument for multinational companies to pressure states.

“These oil firms were offered a brilliant compensation,” says Juan Carlos Boue, a Venezuelan researcher at the Oxford Institute of Energy. “But when the oil price rose, they decided to leave the country with as much money as possible.” For ExxonMobil, a giant with a revenue of 400 billion dollars, twice as big as the GDP of Venezuela, there is more at stake. “They have unlimited resources. They want to let the world know what happens if you challenge them.”

And the arbitrators? “Some of them are on the boards of multinational companies. They just don’t want the countries to get away with it. They have an extreme dislike towards countries like Venezuela.”

ExxonMobil and ConocoPhillips refrained from any comment.

(End)

Excerpt:

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

By Roberto Savio
ROME, Nov 21 2014 (IPS)

Less than a week after everybody celebrated the historical agreement on Nov. 17 between the United States and China on reduction of CO₂ emissions, a very cold shower has come from India.

Indian Power Minister Piyush Goyal has declared: “India’s development imperatives cannot be sacrificed at the altar of potential climate change many years in the future. The West will have to recognise we have the needs of the poor”.

This is also a blow to the Asia policy of U.S. President Barack Obama, who came back home from signing the CO₂ emissions agreement in Beijing, touting his success on establishing U.S. policy in the region.

Roberto Savio

But, more importantly, will give plenty of ammunition to the Republican Congress, which has been fighting climate control on the grounds that the United States cannot engage on climate control unless other major polluters make similar commitments. This was always directed to China, which had refuse to make any such commitment until President Xi, to the surprise of everybody, did so by signing an agreement with Obama.

India is a major polluter, not at the level of China, which has now reached 9,900 metric tons of CO₂, against the 6,826 of the United States. But India is coming up fast. “The incestuous relations between energy corporations and governments are out of the public's eye. It is yet further proof that, even when nothing less than survival is at stake for islands and coastlines, agriculture and the poor, governments are unable – or unwilling – to see beyond their immediate existence”

Goyal has promised that India’s use of domestic coal will rise from 565 million tons last year to more than a billion tons by 2019, and he is selling licences for coal mining at a great speed. The country has increased its coal-fired plants by 73 percent in just the last five years. In addition, Indian coal is of poor quality, polluting twice as much as coal in the West.

Nevertheless, newly-elected Indian Prime Minister Narendra Modi has announced that he will embark on a major programme of renewable sources of energy, and there is an apparent paradox in the fact that many of the climate scientists who form the Intergovernmental Panel on Climate Control (IPCC) are from India. Its Director-General is an Indian, Dr. Rajendra K. Pachauri, who is also chief executive of the Energy Resources Institute in New Delhi.

The IPCC’s last report was much more dramatic than previous ones, stating conclusively that climate change is due to the action of man, and providing an extensive review of the damage that the agricultural sector is bound to face, especially in poor countries like India. At least 37 million people would be displaced by rising seas.

Indian towns are by far the most polluted in the world, surpassing several times each year the worst polluted day in China.

But what is more worrying is that governments are reacting too slowly. It would take a very major effort, which is not now on the cards, to keep temperature from rising by more than 2 degrees Centigrade, and therefore to start to reduce emissions by 2020. Emissions in 2014 are expected to be the highest ever, at 40 billion tonnes, compared with 32 billion in 2010.

The consensus is that to limit warming of the planet to no more 2 degrees Centigrade above pre-industrial levels, governments would have to restrict emissions from additional fossil fuel burning to about 1 trillion tons of carbon dioxide.

But, according to the IPCC report, energy companies have booked coal and petroleum reserves equal to several times that amount, and they are spending some 600 billion dollars a year to find more. In other words, governments are directly subsidising the consumption of fossil fuel.

By contrast, less than 400 billion dollars a year are spent to reduce emissions, a figure that is smaller than the revenue of one just one U.S. oil company, ExxonMobil.

The last meeting of the G20 in Brisbane earlier this month gave unexpected attention to climate, but the G20 alone is spending 88 billion dollars a year in subsidies for fossil fuel exploration, which is double that which the top 20 private companies are spending to look for new oil, gas and coal.

The G20 spends 101 billion dollars to support clean energy in a clear attempt to make everybody happy but, according to the International Energy Agency, if G20 governments directed half of their subsidies, or 49 billion dollars a year, to investment for redistributing energy from new sources, we could achieve universal energy access as soon as 2030.

Another good example of the total lack of coherence from Western governments is that they have pledged an amount of 10 billion dollars for a Green Climate Fund, whose task is to support developing countries in mitigating and adapting to climate change. That amount is two-thirds of what those countries have been asking for and, since its creation in 1999, the fund has still to become operational.

And it was only after the last G20 meeting that the United States pledged three billion dollars and Japan 1.5 billion, bringing the total so far to 7 billion dollars – one-third is still missing.

And now we have the upcoming Climate Conference in Lima, in December, where opinion is that governments will once again fail to reach a comprehensive agreement on climate change – and the amount of time left for the planet will reduce even further.

Besides the fight to be expected from the Republican Congress in the United States, there will be also be opposition from countries that depend on fossil fuels, such as Russia, Australia, India, Venezuela, Iran, Saudi Arabia and the Gulf countries.

So, governments show a total lack of consensus and responsibility. If a referendum could be held asking citizens if they would prefer to pay 800 billion dollars less in taxes to avoid subsidising pollution, there are few doubts what the result would be. And there would be same result if they were asked if they would prefer to invest those 800 billion dollars in clean energy or continue to pollute.

But the incestuous relations between energy corporations and governments are out of the public’s eye. It is yet further proof that, even when nothing less than survival is at stake for islands and coastlines, agriculture and the poor, governments are unable – or unwilling – to see beyond their immediate existence. We are direly in need of global governance for this kind of globalisation. (END/IPS COLUMNIST SERVICE)

(Edited by Phil Harris)

Excerpt:

Activist shareholders hope that publicly assessing and disclosing the financial risk associated with certain carbon-intensive operations will dissuade Exxon and other energy companies from extracting oil and natural gas in high-risk, environmentally sensitive areas like deep water and tar sands. Credit: Bigstock

By Bryant Harris
WASHINGTON, Mar 25 2014 (IPS)

As the international community and the U.S. government place a heightened emphasis on reducing carbon emissions as a way to combat global climate change, shareholders have convinced the oil-and gas giant ExxonMobil to publicly disclose the risk that strengthened regulation could pose to its profits.

The Texas-based company announced its intentions last week and agreed to publish a carbon asset risk report on its website by the end of the month.“If Big Oil can’t redirect capital to low-carbon energy alternatives, investors will.” -- Natasha Lamb

“Investors … are looking at the energy market and starting to see shifts that they’re concerned about,” Danielle Fugere, president of As You Sow, an advocacy group that spearheaded shareholder pressure on the issue, told IPS.

“Those range from the potential for carbon regulations to what happens if the world actually gets smart and works to limit carbon in order to prevent global warming. The investors are looking at increasing cost curves for non-conventional fuels.”

Activist shareholders hope that publicly assessing and disclosing the financial risk associated with certain carbon-intensive operations will dissuade Exxon and other energy companies from extracting oil and natural gas in high-risk, environmentally sensitive areas like deep water and tar sands.

Exxon’s decision was largely due to pressure from As You Sow and a key shareholder, Arjuna Capital. In return, Arjuna Capital and As You Sow dropped a shareholder resolution that would have put the issue to a vote at Exxon’s annual shareholder meeting.

“If we are going to avoid catastrophic climate change, we can only burn one third of [known] carbon reserves,” Natasha Lamb, the director of equity research and shareholder engagement at Arjuna Capital, told IPS. “So the big question is, if regulation market forces prevent oil companies from burning that other two-thirds, why are they spending so much in shareholder value exploiting more?

“As investors, we want to understand what kind of scenario analyses they’re running taking these huge risks into account, and if they’re profitably allocating shareholder capital.”

Investors ultimately hope that a combination of increased regulations on carbon emissions and subsequent shareholder concerns will prompt large energy firms to diversify their assets and invest in more sustainable forms of energy.

“Forward-thinking companies need to re-assess how they allocate shareholder capital and act strategically to shift their business models,” said Lamb. “If Big Oil can’t redirect capital to low-carbon energy alternatives, investors will.”

Lamb also believes that Exxon’s decision will set a precedent and encourage other companies to similarly disclose their carbon asset risks, lest they alienate their investors.

“There are 10 other shareholder proposals this year asking companies to report on carbon emissions risks,” Lamb said. “I would expect that, after Exxon’s announcement, you’ll see increasing disclosures from fossil fuel companies.”

The move also signifies that Exxon, which has a history of lobbying against climate change legislation, may start to take the issue more seriously in public – particularly as shareholders become concerned about the effects of carbon emissions regulations on the energy giant.

“I think it’s important that Exxon has questioned whether climate change is occurring, and I think the company’s finally saying, ‘Yes, climate change is real,’” said As You Sow’s Fugere.

While Exxon initially challenged the resolution with the Securities and Exchange Commission (SEC), the country’s main corporate regulator, the SEC overruled the challenge. Although the SEC had instituted a requirement compelling companies to publicly report on the impacts of climate change on their businesses, Congress passed legislation that blocked that mandate in 2010.

Stranded assets

Along with the rest of the international community, the United States and European Union have agreed to limit the average increase in global temperatures to two degrees Celsius above pre-industrial levels.

Yet climate scientists calculate that if humans burn more than a third of the world’s current proven carbon reserves between 2000 and 2050, there is a 20 percent risk that the global temperature will rise beyond this level. Non-profit advocacy groups like the Carbon Tracker Initiative have thus coined the term “unburnable carbon” to describe the excess reserves that would raise the global temperature by more than two degrees above pre-industrial levels.

Nonetheless, in 2012, the 200 largest publicly traded fossil fuel companies invested approximately 674 billion dollars to discover and develop new carbon reserves. Because companies cannot utilise new reserves without breaking the international community’s agreed-upon standards, some shareholders consider the exploration and development of additional carbon reserves to be a “stranded asset”, an asset that is obsolete and must therefore be recorded as a loss on a company’s balance sheets.

The Carbon Tracker Initiative’s 2013 report on unburnable carbon and the large amount of shareholder money invested in new carbon reserves prompted Ceres, a group of 70 international investors with more than three trillion dollars in assets, to pressure the top 45 energy companies to assess and report on the risks that a global decrease in carbon demand could pose.

Such initiatives are already starting to have a public impact. Last January, for instance, Ceres’s shareholders successfully pressured FirstEnergy, an Ohio-based utility company, into studying and reporting on what it could do to reduce carbon emissions in line with President Barack Obama’s goal of reducing total U.S. carbon emissions by 80 percent by 2050.

Additionally, last year As You Sow filed a vote with shareholders at CONSOL Energy, a natural gas and coal firm, requesting that the company report on the risk of stranded assets derived from carbon emissions. While CONSOL was resistant to the request on the grounds that it already produces a corporate social responsibility report, nearly 20 percent of CONSOL shareholders voted in favour of the proposal, a figure that Fugere deems significant.

“Over a billion dollars in investor assets voted in favour of that,” said Fugere. “That was about a 20 to 22 percent ruling, depending on who you ask. When you have over 20 percent of your shareholders indicating it’s a concern, companies are going to take note.”

Workers mop up tar sands oil from Exxon Mobil Pegasus pipeline spill from creek in Mayflower, Arkansas. Credit: NWFblogs/cc by 2.0

By Katelyn Fossett
Apr 3 2013 (IPS)

Environmental groups are sounding alarms about conflicting reports on the size and seriousness of an oil spill that took place late last week in the southern U.S. state of Arkansas.

The spill has generated particular interest because it emanates from a pipeline carrying “tar sands” oil, a particularly heavy and environmentally destructive oil composed of bitumen and diluted with lighter elements.A lot of the people we talked to said, ‘We didn’t even know there was a pipeline under our homes.'

It also comes just as politicians and environmentalists here are engaged in a debate over whether to approve the construction of a major pipeline – known as Keystone XL – that would carry the same tar sands oil from Canada to the southern U.S.

“[Pipeline owner] ExxonMobil is sort of dancing around how they’re describing it,” Jane Kleeb, executive director of BOLD Nebraska, an advocacy group fighting the Keystone XL pipeline, told IPS.

“Every time they talk about the oil spill, they describe it in different terms – sometimes as crude oil, sometimes Canadian oil – but we’re fairly certain it is tar sands oil.”

On Tuesday, 22 homes in the town of Mayflower were evacuated and at least 12,000 barrels of what the Sierra Club, an environment group, calls the “dirtiest oil on Earth” had been released, reportedly darkening yards and driveways across the suburban town.
Critics of the Keystone project, including BOLD Nebraska, are particularly concerned about the spill’s release of benzene, a carcinogenic chemical found in tar sands oil, and bitumen, which climate scientists say releases 17 percent more greenhouse gases than standard oil.

Meanwhile, President Barack Obama is surveying the environmental and health evidence in order to determine whether the construction of Keystone XL would serve the “nation’s interest”. He is expected to give a final ruling on Canadian company Transcanada’s application to build the pipeline by late summer.

Despite environmental concerns, recently released polls from the Pew Research Center suggest broad support has been gathering for the project’s approval, likely bolstered by Congressional Republicans’ trumpeting the project’s potential for job creation.

The spill also comes a month after a draft environmental impact assessment from the U.S. State Department concluded that the Keystone XL project would “not likely result in significant adverse environmental effects”. That conclusion is likely to be subject to greater scrutiny as Mayflower residents continue to reel from the spill’s damage.

“To see the devastation in that town is pretty sobering,” Glenn Hooks, a spokesman for the Arkansas chapter of the Sierra Club, told reporters Tuesday. “I spoke with people whose lives have been upended – they want to know when they can go home, and they want to know if there will be a home to come back to.”

Anthony Swift, an attorney with the Natural Resources Defense Council, a watchdog group, said the spill brings the risks of the Keystone XL pipeline into “sharp relief for the American people”.

Swift noted that bitumen oil pipelines require higher operating temperatures that make ruptures more likely, citing a study that found that states that carried bitumen oil for the longest periods had experienced 3.6 times as many spills as the national average.

He called the Mayflower oil spill “a tragic warning”, but alluded to previous warnings that had gone unheeded.

“TransCanada’s Bison and Keystone I pipelines had special conditions that were supposed to make them safer. The Keystone I pipeline had to be shut down in its first year after having 14 spills,” he said.

Little clarity

In the days following the Mayflower spill, the opaqueness surrounding the leak and the pipeline in general has been of particular concern for environmental groups.

“A lot of the people we talked to said, ‘We didn’t even know there was a pipeline under our homes,’” said Hooks of the Arkansas Sierra Club. “And I’m sure the ones who did know were surprised to learn it was a tar sands oil pipeline.”

Kleeb, of BOLD Nebraska, pointed to ExxonMobil’s failure to disclose potential health hazards by specifying sooner exactly what kind of oil had been spilled.

“ExxonMobil is not giving folks a clear sense of what was spilled … It’s obvious why they’re not saying it’s tar sands,” she said, referring to the growing concerns over tar sands oil pipelines in the midst of the Keystone debate.

Exxon spokesperson Charles Engelmann said the leaking pipeline was built in the 1940s, but did not have any information on when it last underwent maintenance. In 2010, the U.S. Department of Transportation fined the company for going more than five years without maintenance on a section of the same pipeline beneath the Mississippi River.

With environmental groups already sceptical of an incomplete picture of the environmental and public health impact of Keystone XL, many are now suggesting that these growing signals of oil companies’ poor commitment to maintenance and regulation standards should carry serious implications for the president’s ultimate decision to approve the project.

“Looking at the differences between the reality and rhetoric, TransCanada’s claims that this pipeline will be different don’t add up,” warned Swift of the National Resources Defense Council.