View of the Ras Tanura terminal in Saudi Arabia, the oil exporter receiving the highest revenues in the context of the crisis generated by the Russian invasion of Ukraine. CREDIT: Aramco

By Humberto Márquez
CARACAS, Apr 13 2022 (IPS)

The oil and gas supply crisis unleashed by the Russian invasion of Ukraine represents new business opportunities for the oil-producing countries of the developing South, both traditional and emerging, and also for accelerating the global transition to green forms of energy.

“The countries with the most positive economic effects are the net exporters that depend on hydrocarbon revenues for a large portion of their budget, economic activity and foreign exchange,” Nate Graham, head of energy at the Washington-based think tank Inter-American Dialogue, told IPS.

In Latin America this is the case, Graham said, for “countries such as Colombia, Ecuador and Venezuela, while on the other hand, countries in the Caribbean, Central America and Chile, which import oil and gas, will suffer the opposite effect.”

The opportunities arose after the Feb. 24 invasion of Ukraine, due to the abrupt withdrawal, in markets with fragile balances, of some three million (159-liter) barrels per day of crude oil from Russia, and the decision of a large part of Europe to cancel gas imports from Russia and look for other suppliers.

Oil and gas producers in the South “are enjoying extraordinary revenues,” Venezuelan oil geopolitics expert Kenneth Ramirez told IPS, “but those who are not producers have higher energy bills and are suffering from higher prices for food, of which Russia and Ukraine are major suppliers.”

Graham said: “Even in oil-producing countries, rising consumer fuel prices put pressure on governments to provide subsidies, which can then be politically difficult to reverse when prices fall again.”

But it seems that it is not yet time to heed all the warnings, given the new “(black) gold rush” unleashed in a world dependent on fossil fuel energy and aware that it will continue to be so for several more decades.

The oil production vessel Liza Destiny is used by Exxon to develop oil fields under Atlantic waters that Guyana has not yet definitively demarcated with neighboring Venezuela. CREDIT: SBM Offshore

Room for everyone

In South America one of the first to benefit has been Guyana, which extracted from the Atlantic Ocean – in waters pending delimitation with Caracas, noted Ramirez, who chairs the private Venezuelan Council of International Relations – some 110,000 barrels per day (b/d) in 2021 and expects to add another 220,000 within a year.

To achieve this, U.S. oil giant Exxon, with a century and a half of experience in the industry, accelerated its decision to invest another 10 billion dollars in Guyana.

Neighboring Suriname is also hoping for new investments, and traditional exporters Colombia and Ecuador must be rubbing their hands together in anticipation. But the most striking note was a new contact between the United States and Venezuela.

Formal ties between the two political opponents are broken, Washington has imposed sanctions that prevent Caracas from freely trading its oil and the South American country has made a show of being Russia’s ally in the region.

Venezuela, a major oil exporter throughout the 20th century, with production exceeding three million b/d between 1997 and 2001, now produces less than 700,000 b/d, following a decline in its oil industry under the administration of President Nicolás Maduro, in office since 2013.

But the country has gigantic reserves, close to 300 billion barrels, mostly of heavy crude, and the market read the new contact from Washington as a sign that the United States has decided that the adiós to Russian supplies will last for a long time.

The US company Chevron, which maintains a minimum level of production in Venezuela with Washington’s permission, could invest to produce another 200,000 b/d in a year, and the state-owned oil company Petróleos de Venezuela (PDVSA) is studying the leasing of new oil tankers, according to industry sources.

A technician works at the Tema refinery in Ghana, an emerging oil producer in West Africa. CREDIT: TOR

In Africa, in addition to the best-known producers, such as Nigeria, Angola, Libya, Algeria and Egypt, there are the hopes of the smaller and newer producers, such as Equatorial Guinea, South Sudan and above all Ghana, which, from producing a few thousand barrels a day five years ago, now produces almost 170,000 barrels per day.

Iran is another long-time oil producer which is again flexing with the crisis: it maintains energy alliances with Russia while the tug-of-war with the United States – which has sanctioned it for more than 40 years – continues over its nuclear program, whose redefinition may free it from some sanctions.

Tehran, which produces 2.5 million b/d, is preparing to increase its crude oil exports from 1.2 to 1.4 million b/d, and has a long-term plan to return to a production level of four million b/d.

Among the major beneficiaries of the crisis are the Gulf Arab exporters and in general the partners of the Organization of Petroleum Exporting Countries (OPEC), which act in alliance with 10 other producers in the OPEC+ group.

Saudi Arabia’s Aramco alone already recorded pre-war profits of 110 billion dollars in 2021 (compared to 49 billion dollars in 2020). Both the kingdom and the neighboring United Arab Emirates have been asked by Washington to increase oil production in order to avoid a price spike.

The main benchmark crudes, U.S. West Texas Intermediate (WTI) and North Sea Brent, were trading at around 70 dollars per barrel in 2021, but with the Ukraine crisis their prices soared: Brent has been holding steady this April at above 100 dollars and WTI at close to 95 dollars.

Global demand for crude oil is approximately 100 million b/d, of which OPEC contributes 32 million b/d, plus another 14 million b/d from the 10 OPEC+ allies, including Russia, Kazakhstan and Mexico.

OPEC+ rejected the request of large consumers, considering that the price increase is not due to market fundamentals but to the conflict in Ukraine, and agreed to add only 432,000 b/d to the group’s supply, starting in May.

“Nobody listened when we said more investments were needed in oil and gas,” said Emirati Oil Minister Suhail al-Mazroui. “Raising production will only be in a measured way and through a consensus among members.”

U.S. President Joe Biden then ordered the release of one million b/d for six months from his country’s strategic reserves of more than 650 million barrels, to increase the crude oil available to refineries and thus try to curb the rise in fuel prices.

Meanwhile, Algeria allowed itself the luxury of maintaining steady prices for the gas it exports to all its customers but not to Spain, in retaliation for a change in Madrid’s position on the dispute over the self-determination of the Saharawi people.

A crude desalter unit on its way to the Orinoco Oil Belt in southeastern Venezuela, considered the largest deposit of heavy crude on the planet and whose diminished production could receive a new boost as a result of the current energy crisis. CREDIT: PDVSA

The weight of Russia

And Moscow has stated that it will receive payment in rubles for its oil and gas exports to Europe, a region 40 percent dependent on Russian gas and 27 percent on its oil, with which it has not been able to completely do without after six weeks of war.

The late U.S. politician John McCain (1936-2018) said in 2014 that Russia “is a gas station masquerading as a country” to underline the nation’s heavyweight status in the field of fossil fuel energy.

Of the 1.7 trillion barrels of crude oil reserves on the planet, Russia has 107 billion, surpassed only by Venezuela, Saudi Arabia, Canada, Iran and Iraq. The Eurasian country produces 10.8 million b/d (more than 10 percent of the world total), behind only the United States and almost as much as Saudi Arabia.

In gas its weight is even greater, since it has 20 percent of the world’s reserves (38 of 188 trillion cubic meters), making it the leader by far, and with its annual production of 638 billion cubic meters it covers more than 18 percent of global demand.

The richest will earn more

Among the winners, oil companies will earn the most, and this year the 25 largest could make profits between 100 and 120 billion dollars higher than in 2021, when, according to the U.S. organization Accountable.US, they made record profits of 237 billion dollars.

Consumers, meanwhile, will pay the price. In almost all of Latin America a liter of gasoline costs well over a dollar (1.75 dollars in Uruguay, 1.40 in Chile, and 1.32 in Guatemala, for example) and even in up-and-coming Guyana – which has crude oil but no refinery, Graham pointed out – it sells for almost 1.10 dollars.

In the United States, where one out of every five barrels of oil the world produces is consumed, a liter cost 75 cents a year ago and this April averaged 1.10 dollars, with higher prices on the Pacific coast.

Gasoline prices this year exceeded four dollars per gallon (more than a dollar per liter) in the United States, and in an attempt to curb prices the government is releasing part of its strategic crude reserves so that the refineries have sufficient supplies. CREDIT: Fidel Márquez/IPS

Path to greener energy

In Europe, “the majority are now betting on a pragmatic and possibilist vision, which continues to focus on renewable energies and energy efficiency, but a debate is opening up about the use of nuclear energy and even coal, which would make a better balance between energy security and climate change,” said Ramírez.

Graham believes that “the present crisis underscores the geopolitical risks of dependence on foreign oil and gas and the importance of reducing it for security reasons, which can be an accelerating factor for the transition to renewable technologies and green hydrogen (obtained from clean energy sources).”

But “on the other hand, some may interpret the present crisis as a reason to increase domestic and regional hydrocarbon production in the short term, which may extend dependence on fossil fuels, while companies recover the costs of new investments,” he said.

In addition, there is pressure on governments to provide fuel subsidies to lessen the impact of the crisis on consumers, which may be politically difficult to reverse and might thus generate the opposite effect to what is needed to drive the energy transition, Graham said.

The International Energy Agency (IEA), made up of major industrialized consumers, recognized at its Mar. 24 meeting held to assess measures to address the crisis “the importance to energy security and clean energy transitions of ensuring clean, affordable, reliable, resilient, and secure energy infrastructure.”

Energy security and the transition to clean energies are “inextricably linked” in the view of the IEA, and its executive director, Fatih Birol, stated that “the response to this energy crisis will be an acceleration of the transition to clean energy,” not necessarily for climate reasons, but for energy security.

Renewable energy is at the forefront of the changes sweeping Africa, and a “triple win” is within the region’s grasp to increase agricultural productivity, improve resilience to climate change, and contribute to long-term reductions in dangerous carbon emissions.

This is the message of a new report by former U.N. Secretary-General Kofi Annan’s Africa Progress Panel, titled Power, People, Planet: Seizing Africa’s Energy and Climate Opportunities.

The report calls for a ten-fold increase in power generation to provide all Africans with access to electricity by 2030, saying that this would reduce poverty and inequality, boost growth and provide the climate leadership that is sorely missing at the international level.

It also urges African governments, investors, and international financial institutions to scale up investment in energy significantly in order to unlock Africa’s potential as a global low-carbon superpower. “We categorically reject the idea that Africa has to choose between growth and low-carbon development. Africa needs to utilise all of its energy assets in the short term, while building the foundations for a competitive, low-carbon energy infrastructure” – Kofi Annan

“We categorically reject the idea that Africa has to choose between growth and low-carbon development,” said Annan. “Africa needs to utilise all of its energy assets in the short term, while building the foundations for a competitive, low-carbon energy infrastructure.”

Over 62 million people in sub-Saharan Africa lack access to electricity – and this number is rising.

The report notes that, excluding South Africa, which generates half the region’s electricity, sub-Saharan Africa uses less electricity than Spain. It would take the average Tanzanian eight years to use as much electricity as an average American consumes in a single month. And over the course of one year someone boiling a kettle twice a day in the United Kingdom uses five times more electricity than an Ethiopian consumes over the same year.

Power shortages are estimated to diminish the region’s growth by 2-4 percent a year, holding back efforts to create jobs and reduce poverty.

Despite a decade of growth, the power generation gap between Africa and other regions is widening. Nigeria, for example, is a petroleum exporting superpower, but 95 million of the country’s citizens rely on wood, charcoal and straw for energy.

The report reveals that households living on less than 2.50 dollars a day collectively spend 10 billion dollars every year on energy-related products, such as charcoal, kerosene, candles and torches.

Measured on a per unit basis, Africa’s poorest households are spending around 10 dollars/kWh on lighting – 20 times more than Africa’s richest households. By comparison, the national average cost for electricity in the United States is 0.12 dollars/kWh and in the United Kingdom 0.15 dollars/kWh.

The report says Africa’s leaders must start an energy revolution that connects the unconnected, and meets the demands of consumers, businesses and investors for affordable and reliable electricity.

It urges African governments to:

• Use the region’s natural gas to provide domestic energy as well as exports, while harnessing Africa’s vast untapped renewable energy potential.

• Cut corruption, make utility governance more transparent, strengthen regulations and increase public spending on energy infrastructure.

• Redirect the 21 billion dollars spent on subsidies for loss-making utilities and electricity consumption – which benefit mainly the rich – towards connection subsidies and renewable energy investments that deliver energy to the poor.

The report also calls for strengthened international cooperation to close Africa’s energy sector financing gap, estimated to be 55 billion dollars annually to 2030, which includes 35 billion dollars for investments in plant, transmission and distribution, and 20 billion dollars for the costs of universal access.

A global connectivity fund with a target of reaching an additional 600 million Africans by 2030 is said to be needed to drive investment in on- and off-grid energy provision, with aid donors and financial institutions doing more to unlock private investment through risk guarantees and mitigation finance.

Time to end ‘climate negotiating poker’

The report also challenges African governments and their international partners to raise the level of ambition for the crucial climate summit in Paris in December, and calls for wholesale reform of the fragmented, under-resourced and ineffective climate financing system.

G20 countries are called on set a timetable for phasing out fossil fuel subsidies, with a ban on exploration and production subsidies by 2018.  “Many rich country governments tell us they want a climate deal. But at the same time billions of dollars of taxpayers’ money are subsidising the discovery of new coal, oil and gas reserves,” said Annan. “They should be pricing carbon out of the market through taxation, not subsiding a climate catastrophe.”

While recognising recent improvements in the negotiating positions of the European Union, the United States and China, the report says that current proposals still fall far short of a credible deal for limiting global warming to no more than 2˚C above pre-industrial levels.

The former U.N. Secretary-General said that “by hedging their bets and waiting for others to move first, some governments are playing poker with the planet and future generations’ lives. This is not a moment for prevarication, short-term self-interest and constrained ambition, but for bold global leadership and decisive action.”

“Countries like Ethiopia, Kenya, Rwanda and South Africa,” he added, “are emerging as front-runners in the global transition to low carbon energy. Africa is well positioned to expand the power generation needed to drive growth, deliver energy for all and play a leadership role in the crucial climate change negotiations.”

Edited by Phil Harris    

Is the G7 commitment to an energy transition that aims to gradually phase out fossil fuel emissions this century to avoid the worst of climate change just hot air? Credit: CC BY-SA 2.5

By Lucy Cadena
LONDON, Jun 11 2015 (IPS)

One of the promises made by the leaders of the world’s seven richest nations when they met at Schloss Elmau in Germany earlier this week was an energy transition over the next decades, aiming to gradually phase out fossil fuel emissions this century to avoid the worst of climate change.

Let us be clear: a target of zero fossil fuels by 2100 puts us on track for warming on an unmanageable scale. The only commitment made by the G7 this week was a commitment to climate chaos.

Putting our faith in as-yet-underdeveloped technology fixes such as ‘carbon capture and storage’ and ‘geo-engineering’ to save us in the next 85 years, while the solutions to the climate crisis – renewable technology and community energy systems – exist here and now, is senseless.“The only way to avoid the worst of climate change is to act now, with urgency and ambition. Not by 2100, nor 2050. We need real commitment to real solutions – and the best place the G7 can start is by taking its money – public money – out of dirty energy”

The only way to avoid the worst of climate change is to act now, with urgency and ambition. Not by 2100, nor 2050. We need real commitment to real solutions – and the best place the G7 can start is by taking its money – public money – out of dirty energy.

While the G7 gathered on Jun. 7 and 8, this was the message from people from around the world, who are calling for a ban on all new dirty energy projects and an end to the financing of dirty energy.

The G7’s role in upholding the current dirty energy system is not limited to the subsidies they pour into fossil fuels daily.

G7 countries also directly finance – and profit from – dirty energy projects, particularly in the global South, and in regions where poverty and limited energy access devastate families.

These include projects affecting communities deeply reliant on clean air, water, and land that is polluted and stolen from them, projects among populations most vulnerable to the effects of climate change, and projects where people face harassment and human rights violations for speaking out.

France

Last week, France, host of the 30 November-11 December 2015 Paris climate summit – the U.N. gathering to set the agenda for global climate commitments in the next decades – announced that two of the summit’s key sponsors will be EDF and ENGIE (formerly GDF-Suez).

The French state holds 84 percent and 33.3 percent of shares in these companies respectively. Both are involved in the construction of several very controversial, polluting projects across the world.

EDF is currently planning the destructive Mphanda Nkuwa mega-dam on the Zambezi River in Mozambique, in the face of fierce opposition from local communities and environmental organisations.

A letter from civil society reminds French President François Hollande that these and other projects place EDF and ENGIE among the top 50 companies that contribute the most to global climate change.

With 46 coal-fired power plants between them, EDF and ENGIE are responsible for emitting 151 million tonnes of CO₂ a year – which amounts to about half the total of France’s overall emissions.

Italy

The Italian state owns a considerable number of shares – almost one-third – in oil and gas company ENI. According to a recent report by Amnesty International, last year alone ENI reported 349 oil spills in the Niger Delta from its own operations.

The figure is remarkable – almost unbelievable. Each spill triggers a human and ecological crisis. The scale of the devastation and ENI’s failure to safeguard communities and ecosystems begs the question: is this sheer incompetence, recklessness, or simply utter indifference to the welfare of local communities?

Japan

Japan, the next offender on the G7 list, is the number one public financier of coal plants globally among the Organisation for Economic Cooperation and Development (OECD) countries.

Japan has 24 coal-powered projects either under construction or planned, many of them in Indonesia, Vietnam and India, where the more vulnerable local populations live under the cloud of plants’ toxic emissions.

Emissions of deadly sulphur dioxide and nitrogen oxides from coal plants are currently highest in Indonesia, where the planned Batang coal power plant is set to become the largest ever Japanese-financed plant in Southeast Asia.

United States

A report by Oil Change International indicates that the United States government alone provides 5.1 billion dollars in national subsidies to fossil fuel exploration each year – that’s 5.1 billion dollars into seeking out new sources of civilisation-destroying energy sources.

Canada

Likewise, Canada’s expanding oil sector (caused by the growth in dirty tar sands production, known as ‘the biggest industrial project on Earth’) continues to reap the benefits of massive national subsidies.

United Kingdom

The U.K. government spent 300 times more supporting dirty energy overseas than it contributed towards renewable energy projects during its last term.

The 2012-2013 annual report of UK Export Finance, the country’s export credit agency, announced spending on projects such as a 147 million pounds (228 million dollars) guarantee to support oil and gas exploration by Petrobras in Brazil and 15 million pounds (23 million dollars) in guarantees to a loan for a gas power project in the Philippines.

Domestically, the government is prioritising drilling for new oil and gas, which will require huge subsidies. Hailing carbon-emitting gas as a ‘bridge fuel’ towards a cleaner energy system, the government is delaying investment in renewables to push fracking onto a population that vehemently opposes the dash for gas.

Germany

Meanwhile, Germany – the host of the G7 meeting – has been much lauded for its ‘Energiewende’ (‘Energy Revolution’), with a rapidly increasing use of renewable energy compensating for its nuclear phase-out in recent years.

However, German euros still make their way into the dirty energy machine – through sizeable tax exemptions afforded to fossil fuel producers’ exploration activities – allowing such companies to go further and dig deeper to uncover more carbon that needs to stay in the ground.

G7 Must Catch Up

The G7 countries have done the most to cause climate change. According to the Climate Equity Reference Calculator, they are responsible for 70 percent of historical carbon emissions, while hosting only 10 percent of the global population.

A commitment to a phase-out of fossil fuels in eight decades’ time is not a commitment. It is an easy promise for a politician, who probably will not even be in power in the next decade, to make. It is an easy promise for a rich nation, whose citizens are not the most vulnerable, to make.

G7 societies have grown rich by exploiting the human and natural world. They owe an enormous ‘climate debt’ to developing nations – yet they can barely scrape together the money they promised to the developing world via the Green Climate Fund.

Whether it’s an oil spill in Nigeria, a mega-dam in Mozambique or a coal plant in Java, the sources of our publicly-owned dirty energy are always sites of ecological and social devastation.

Access to energy is a right, but it should not come at the cost of other people’s rights – to clean air and drinking water, to land and food sovereignty, and to sustainable societies.

The international movement for climate justice is building, and will keep up pressure on governments to take money out of dirty energy and reinvest it in democratic renewable solutions that benefit everyone.

The global shift towards a just energy transformation has long been under way. Now, it’s snowballing. People from around the world are showing the way and implementing community-owned renewable energy solutions.

There is a hunger for change, despite continued inaction from governments. G7 leaders, take note: you are trailing far behind and have a lot of catching up to do!

Edited by Phil Harris

The views expressed in this article are those of the author and do not necessarily represent the views of, and should not be attributed to, IPS – Inter Press Service. 

Excerpt:

Demonstrators protesting at the Business & Climate Summit in Paris, May 20. Credit: A.D. McKenzie/IPS

By A. D. McKenzie
PARIS, May 21 2015 (IPS)

When it comes to climate change, business as usual is simply “not an option”.

That was the view of Eldar Saetre, CEO of Norwegian multinational Statoil, as international industry leaders met in Paris for a two-day Business & Climate Summit, six months ahead of the next United Nations Climate Change Conference (COP 21 ) that will also be held in the French capital.

Subtitled “Working together to build a better economy”, the May 20-21 summit brought together some 2,000 representatives of some of the world’s largest retail and energy concerns, including  companies that NGOs have criticized as being among the worst environmental offenders.

At the end, business leaders proclaimed that they wanted “a global climate deal that achieves net zero emissions” and that they wanted to see this happen at COP 21.

Throughout the conference, participants stressed that businesses will have to change, not only to protect the environment, but for their own survival. “Taking climate action simply makes good business sense. However, business solutions on climate are not being scaled up fast enough,” declared the summit organizers.

They pledged to lead the “global transition to a low-carbon, climate resilient economy.”

Saetre, for example, said his company wanted to achieve “low-carbon oil and gas production” and that it had embarked on renewables in the form of offshore wind energy. But he said that fossil fuels would still be needed in the future, alongside the various forms of renewable energy.

Acknowledging the widespread scepticism about multinational companies’ commitment, business leaders said that they could not “go it alone”, and called for support from governments as well as consumers.

Mike Barry, Director of Sustainable Business at British retailer Marks & Spencer, told IPS in an interview that global commitment was important in the drive to transform industry to have more environmentally friendly practices.

“Collective action can bring about real change,” he said. “We’re here today because we believe that climate change is happening and it’s going to have a significant impact on our business in the future and our success.

“Our customers would expect us to take the lead on this, and we want governments to take this seriously as well in the run-up to COP 21 [the 21st session of the Conference of the Parties to the United Nations Framework Convention on Climate Change to be held in Paris from Nov. 30 to Dec. 11].”

He said that Marks & Spencer and other companies in a network called the Consumer Goods Forum wanted to “stand shoulder to shoulder with government to say ‘this matters and we’re here to help’.”

But government consensus on how to address climate change has proved difficult, and even French President Francois Hollande, who opened the summit, conceded that it would require a miracle for a real agreement to be reached at COP 21.

“We must have a consensus. It’s already not easy in our own countries, so with 196 countries, a miracle is needed,” he said at the Business & Climate Summit, expressing the conviction, however, that agreement will be reached through negotiation and “responsibility”.

Hollande and other officials said the involvement of businesses was essential, and France, with its huge oil and electricity companies, evidently has a big role to play.

However, demonstrators outside the summit, held at the headquarters of the United Nations Educational, Scientific and Cultural Organisation (UNESCO), slammed big business.

“These multinationals (and the banks that finance their activities) are in fact directly at the origin of climate change,” read a statement from organisations including Les Amis de la Terre (Friends of the Earth, France) and the civil disobedience group J.E.D.I. for Climate.

Saying that it was ironic to have fossil-fuel companies represented at the summit, the groups asked: “Can one imagine for a second that the tobacco industry would be associated with policies to combat smoking aimed at ending the production of cigarettes? No, that would be the best way to ensure that the world continued to chain-smoke.”

The protesters added that if Hollande and his ministers wanted to show a real commitment to the environment, they should make it clear that “the climate is not a business”.

“The fight against climate change is not the business of fossil-fuel multinationals: they belong to our past,” the groups said in a joint release, handed out on the street.

At the summit, Christiana Figueres, Executive Secretary of the U.N. Framework Convention on Climate Change (UNFCCC), said that businesses should not be “demonised” and she called for collaboration rather than confrontation.

“We all start with a carbon footprint,” she said. “It is not a question of demonising anyone but realizing that we’re all here … This is not about confrontation. This is about collaboration. If you’re thinking about confrontation, forget it. Because we’re not going to get there.”

The summit – co-hosted by Entreprises Pour l’Environnement, an association of some 40 French and large international companies, and UN Global Compact France, a policy initiative for businesses – also addressed the vulnerability of island states in the face of climate change.

Tony de Brum, the Marshall Islands’ Minister of Foreign Affairs, said that island states in the Pacific and elsewhere had an interest in keeping pressure on carbon emitters because their populations’ survival was at stake.

Angel Gurría, Secretary General of the Paris-based Organisation for Economic Cooperation and Development (OECD), also highlighted the threat to vulnerable countries, saying that for them, climate change is not about protecting the environment for future generations, but “it’s about how long the water will take to overcome the land.”

Gurría said that greater reductions in carbon emissions were required than has so far been proposed by states, and he stressed that countries over time needed to “develop a pathway to net zero emissions globally” by the second half of the century.

“Governments at COP 21 need to send a clear directional signal that will drive action for decades to come,” he said. “We are on a collision course with nature, and unless we seize this opportunity, we face an increasing risk of severe, pervasive and irreversible climate impact.”

Edited by Phil Harris    

Africa’s wetland areas are experiencing immense pressure from commercial development and agriculture, settlements, excessive exploitation by local communities and improperly-planned development activities. Credit: Creative Commons CC0

By Tonderayi Mukeredzi
HARARE, Mar 12 2015 (IPS)

African wetlands are among the most biologically diverse ecosystems on the continent, covering more than 131 million hectares, according to the Senegalese-based Wetlands International Africa (WIA).

Yet, despite their importance and value, wetland areas are experiencing immense pressure across the continent. Commercial development ranks as the major threat for the draining of wetlands, including for tourism facilities and agriculture, where hundreds of thousands of hectares of wetlands have been drained.

Other threats to Africa’s wetlands are commercial agriculture, settlements, excessive exploitation by local communities and improperly-planned development activities. The prospect of immense profits from recently discovered oil, coal and gas deposits has also led to an increase in on-and offshore exploration and mining in sensitive ecological areas.Commercial development ranks as the major threat for the draining of [Africa’s] wetlands, including for tourism facilities and agriculture … Other threats are commercial agriculture, settlements, excessive exploitation by local communities and improperly-planned development activities

In Nigeria, Guinea-Bissau and Mozambique, for example, wetlands and estuaries coincide with fossil fuel deposits and related infrastructure developments.

In northern Kenya, port developments in Lamu are set to take place in the West Indian Ocean Rim’s most important mangrove area and fisheries breeding ground.

In KwaZulu-Natal and the Eastern Cape of South Africa, heavy mineral sands are located in important dune forest ecosystems, and gas is being prospected for in the water-scarce and ecologically unique Karoo.

In East Africa, oil discoveries have been made in the tropical Congo Basin rain forest and the Virunga National Park – a world heritage site and a wetland recognised under the Ramsar Convention.

The Okavango Delta in Botswana, one of Africa’s most important wetlands and designated as the 1,000th world heritage site by UNESCO, has been home to many threatened species and the main water source of regional wildlife in Southern Africa. Yet it is shrinking due to drier climate, increased grazing and growing pressure from tourism.

“This delta is a true oasis in the middle of the bone-dry Kalahari Sand Basin, a rare untouched wilderness that’s been preserved by decades of border and civil wars in the Angolan catchment,” said National Geographic explorer Steve Boyes in an interview. “Many people along the Okavango River live like communities did some 400 years ago – and from them I think we can learn a lot about how to be better stewards of the natural world.”

Boyes calculated the abundance of life in the delta: more than 530 bird species, thousands of plant species, 160 different mammals, 155 reptiles, scores of frogs and countless insects.

“Everywhere you look you find life. We surveyed bats and we found 17 species in three days. We started looking for praying mantises and found 90 different species,” he said.

A recent survey by the Botswana Department of Wildlife and National Parks and the environmentalist group BirdLife Botswana concluded that that the wetland’s historical zones of dense reed beds and water fig islands were largely destroyed by hydrological changes and fire. Bush fires and a high grazing pressure further reduced the natural shores of the Okavango Delta.

Studies by BirdLife Botswana also showed that the slaty egret, a vulnerable water bird living only in Southern Africa, with its main breeding grounds in the wetlands of Zambia, Mozambique and Botswana’s Okavango Delta, is now estimated to have a total population of only about 4,000 birds.

The egret, which is listed on the IUCN Red List of Threatened Species as vulnerable, seems to be losing its main breeding sites in the Okavango.

Environmentalists hope that they can still save the wetland, and pin their hopes on a “Slaty Egret Action Plan” which will be used by the Botswana’s Department of Wildlife and National Parks, BirdLife and other environment stakeholders to guarantee the survival of the Okavango Delta as a safe haven for the birds.

In a further step to save the wetlands, the Botswana government announced this month that from now on, seekers of mobile safari licences would be prohibited from operating in the Okavango Delta because the area in now congested.

The Botswana Guides Association, which represents many of the mobile safaris, is threatening to appeal.

Another example of the devastation of major wetlands occurred in Nigeria with pollution of farmlands linked to the Shell oil company.  The Niger Delta Natural Resource Damage Assessment and Restoration Project, an independent team of scientists from Nigeria, the United Kingdom and the United States, has characterised the Niger Delta as “one of the world’s most severely petroleum-impacted ecosystems.”

In 2013, a Dutch court found the Nigerian subsidiary of Shell culpable for the pollution of farmlands at Ikot Ada Udo in Akwa Ibom state in the coastal south of the country.

The Niger Delta is Africa’s largest delta, covering some 7,000 square kilometres – one-third of which is made up of wetlands. It contains the largest mangrove forest in the world.

Assisted by environmental organisation Friends of the Earth, the court ruling was a victory for the communities in the Niger Delta after years of struggle against the oil company dating back 40 years, although the clean-up still has far to go.

“Destruction of wetlands is prevalent in almost all countries in Africa because the driving factor is the same – population pressure – many mouths to feed, ignorance about the role wetlands in playing in the ecosystem, lack of policies, laws and institutional framework to protect wetlands and in cases where these exist, they are hardly enforced,” John Owino, Programme Officer for Water and Wetlands with the International Union for Conservation of Nature (IUCN)  told IPS from his base in Nairobi, Kenya.

Owino said that the future of African wetlands lies in stronger political will to protect them, based on sound wetland policies and encouragement for community participation in their management, which is lacking in many African countries.

But very few African governments have specific national policies on wetlands and are influenced by policies from different sectors such as agriculture, national resources and energy.

Edited by Lisa Vives/Phil Harris   

Governments continue to subsidise exploration for fossil fuels despite pledges to support the transition to clean energy. Credit: Flickr/Leszek Kozlowski

By Shelagh Whitley
LONDON, Nov 11 2014 (IPS)

Just a week after the Intergovernmental Panel on Climate Change (IPCC) gave its starkest warning yet that the vast majority of existing oil, gas and coal reserves need to be kept in the ground, a new report reveals that governments are flagrantly ignoring these warnings and continuing to subsidise exploration for fossil fuels.

The report by the Overseas Development Institute (ODI) and Oil Change International (OCI) shows that G20 governments are propping up fossil fuel exploration to the tune of 88 billion dollars every year through national subsidies, investment by state owned enterprise and public finance.

Shelagh Whitley, Research Fellow at the Overseas Development Institute (ODI)

And this is only a small part of total government support to producing and consuming fossil fuels, which is estimated at 775 billion dollars a year.

The G20 continues to provide these subsidies – mostly hidden from public view – in spite of repeated pledges to phase out fossil fuel subsidies, address climate change, and support the transition to clean energy.

The subsidies provided to exploration by the G20 alone are almost equivalent to total global support for clean energy (101 billion dollars), tilting the playing field towards oil, gas and coal.

The report also shows that G20 governments spend more than double what the top 20 private companies are spending to look for new oil, gas and coal reserves. This suggests that companies depend on public support for their exploration activities.“Fossil fuel exploration subsidies are fuelling dangerous climate change; this support is increasingly uneconomic; and oil, gas and coal will not address the energy needs of the poorest and most vulnerable”

As finding fossil fuels gets more risky, expensive and energy intensive, and the prices of oil, gas and coal continue to fall, companies are only likely to become more dependent on tax payers’ money to continue exploration.  This was also demonstrated by the recent request by the United Kingdom’s oil and gas industry for further tax breaks to address rising operating costs in the North Sea.

Some will claim that although these subsidies are uneconomic, exceptions can be made. After all, the arguments go, we need fossil fuels to provide energy access – and we can keep burning oil, gas and coal if we just use carbon capture and storage.

This simply isn’t true. Doing so will drive dangerous climate change, with the impacts falling first on the most vulnerable people in the poorest countries and regions.

First, when it comes to energy access, it is actually through clean energy that we will be able to provide heat and electricity to the poorest.

According to the International Energy Agency, most new investment needs to be in distributed energy, including in mini-grid and off-grid options that most often rely on renewable energy sources. If G20 governments redirected 49 billion dollars a year – just over half of what they currently provide in support to fossil fuel exploration – we could achieve universal energy access as soon as 2030.

Second, there has only been very limited application of carbon capture technology so far.

The first and only full-scale ‘commercial’ carbon capture and storage project, launched this year in Canada, relies on government subsidies and sells the captured carbon to the oil industry, which uses it to extract even more fossil fuels. It is not a sustainable model.

In short: fossil fuel exploration subsidies are fuelling dangerous climate change; this support is increasingly uneconomic; and oil, gas and coal will not address the energy needs of the poorest and most vulnerable.

The G20 countries have the resources to support a transition to clean energy. They can set an example for the world by shifting national subsidies, investment by state-owned enterprise and public finance away from fossil fuels and toward renewables and efficiency.

G20 leaders meeting in Brisbane this week must recognise this and make good on their existing pledges. Immediately phasing out fossil fuel exploration subsidies would be the right place to start.

(Edited by Phil Harris)

The views expressed in this article are those of the author and do not necessarily represent the views of, and should not be attributed to, IPS – Inter Press Service. 

Excerpt:

Pacific Climate Warriors organised a canoe flotilla in Australia on Oct. 17 to protest against the Australian coal industry and call for action on climate change. Credit: Jeff Tan for 350.org

By Kaio Tiira Taulu
TUVALU, Oct 25 2014 (IPS)

The fate of my country rests in your hands: that was the message which Ian Fry, representing Tuvalu gave at the United Nations Climate Change Conference in Copenhagen five years ago. This is also the message that the Pacific Climate Warriors have come to Australia to bring.

We have come here, representatives of 12 different Pacific island nations, which are home to 10 million people, to ask the people of Australia to reject plans to double Australia’s exports of coal and to become the biggest exporter of gas in the world.

We want Australia (and other industrialised countries which also rely on the burning and extraction of fossil fuels) to understand that for every kilo of coal which they dig, or every gas well they make, there is someone in the islands who is losing their home.“We want Australia (and other industrialised countries which also rely on the burning and extraction of fossil fuels) to understand that for every kilo of coal which they dig, or every gas well they make, there is someone in the islands who is losing their home”

My home, Tuvalu, is a series of three islands and six atolls halfway between Hawaii and Australia. Tuvalu is the fourth smallest country in the world and home to 11,000 people and most of us have been there for generations

Tuvalu, like many of our island neighbours, is living on borrowed time with climate change expected to displace over 300 million people worldwide before 2050. The displacement has already started to happen with thousands of my countrymen forced to leave by the rising King Tides and the long drought affecting our food supplies.

One family drew international attention when they became the first refugees to seek asylum in New Zealand based on grounds of climate change.

Aside from the humanitarian cost, there is also the loss to culture and diversity with several thousands of years of civilisation and history wiped from the face of the planet. And there is nothing that we can do about this except hope that you and your country will see the value of keeping our island above water and make the decision to turn away from fossil fuels.

This is the reason I have joined with the Pacific Climate Warriors to come to Australia and represent my country and our region.

For years our leaders have tried to convey our message in the halls of power to politicians, diplomats and whoever else would listen, but the arguments of economic growth have always taken precedence over the arguments for our survival.

I now come as an envoy to ask the people of Australia to please consider the plight of the 11,000 people in Tuvalu and the further millions in other Pacific islands and other low lying nations which may expect to be wiped out by climate change.

In my time in Australia I have heard plenty about the importance of the Australian coal industry and the jobs and economic growth that it generates, yet it is us in the islands who are paying the price with our land, our culture and our livelihoods. This hardly seems a fair price to pay when we gain nothing from this industry.

This is why it incenses me so much to hear that coal is good for humanity or coal will be the solution to poverty. Coal will benefit only the wealthy whereas it will be the poor, like us, who suffer.

This is why it is the ultimate insult to hear that wealthy corporations are acting in the interests of the world’s poor when they dig and burn coal.

The Australian people have the power to decide the fate of my country and others in the Pacific. You need to let your government know that you have considered the matter carefully that you choose human life over the digging and export of coal.

If you do not, you must be ready to open your borders for the flood of climate refugees who will end up on your doorstep.

(Edited by Phil Harris)

Excerpt:

July 2014 floods in Russia but authorities turning blind eye to climate change. Credit: takemake.ru

By Mikhail Matveev
MOSCOW, Aug 30 2014 (IPS)

The recent call from Russian Prime Minister Dmitry Medvedev for “tightening belts” has convinced even optimists that something is deeply wrong with the Russian economy.

No doubt the planned tax increases (introduction of a sales tax and increases in VAT and income tax) will inflict severe damage on most businesses and their employees, if last year’s example of what happened when taxes were raised for individual entrepreneurs is anything to go by – 650,000 of them were forced to close their businesses.

Nevertheless, it looks like some lucky people are not only going to escape the “belt-tightening” but are also about to receive some dream tax vacations and the lucky few are not farmers, nor are they in technological, educational, scientific or professional fields – it is the Russian and international oil giants involved in oil and gas projects in the Arctic and in Eastern Siberia that stand to gain.

“In October [2013], Vladimir Putin signed a bill under which oil extraction at sea deposits will be exempt from severance tax. Moreover, VAT will not need to be paid for the sales, transportation and utilisation of the oil extracted from the sea shelf,” noted Russian newspaper Rossiiskie Nedra.“It looks like some lucky people are not only going to escape the ‘belt-tightening’ but are also about to receive some dream tax vacations and the lucky few are not farmers, nor are they in technological, educational, scientific or professional fields – it is the Russian and international oil giants involved in oil and gas projects in the Arctic and in Eastern Siberia that stand to gain”

Some continental oil projects were alsoblessedby the “Tsar’s generosity”: “For four Russian deposits with hard-to-recover oils [shale oil, etc.] – Bazhenovskaya [in Western Siberia] and Abalakskaya in Eastern Siberia, Khadumskaya in the Caucasus, and Domanikovaya in the Ural region – severance taxes do not need to be paid. Other deposits had their severance tax rates reduced by 20-80%.”

In fact, the line of thinking adopted by Russian officials responsible for tax policy is very simple. Faced with the predicament of an economy dependent on oil and gas (half of the state budget comes from oil and gas revenue, while two-thirds of exports come from the fossil fuel industry), they decided to act as usual – by stimulating more drilling and charging the rest of the economy with the additional tax burden.

There have been many warnings from well-known economists about the “resource curse” [the paradox that countries and regions with an abundance of natural resources tend to have less economic growth and worse development outcomes than countries with fewer natural resources] – and its potential consequences for the countries affected: from having weak industries and agriculture to being prone to dictatorships and corruption.

For a long time, however, economists have been keen on separating the economic and social impacts of fossil fuel dependency from the environmental and climate-related problems. But now, these problems are closely interconnected, and Russia might be the first to feel the strength of their combination in the near future.

Medvedev may not have read much about the “resource curse” but he should at least be familiar with the official position of the UN Framework Convention on Climate Change (UNFCC), whose Executive Secretary Christiana Figueres has said that three-quarters of known fossil fuel reserves need to stay in the ground in order to avoid the worst possible climate scenario.

One should at least expect this amount of knowledge from Russia as a member of the UN Security Council and it will be interesting to note whether the Russian delegation attending the UN Climate Summit in New York on September 23 will be ready to explain why, instead of limiting fossil fuel extraction, the whole country’s economic and tax policy is now aimed at encouraging as much drilling as possible.

However, it is not just the United Nations that has been warning against the burning of fossil fuels due to the related high climate risks. In 2005, Russia’s own meteorology service Roshydromet issued its prognosis of climate change and the consequences for Russia, stating that the rate of climate change in Russia is two times faster than the world’s average.

Roshydromet predicted a rapid increase in both the frequency and strength of extreme climate events – including floods, hurricanes, droughts, and wildfires. The number of such events has almost doubled during the last 15 years, and represent not only an economic threat but also a real threat to humans’ lives and their well-being,

Consider this summary of climate disasters in Russia during an ordinary July week (not including any of the large natural disasters such as the floods in Altai, Khabarovsk, and Krymsk, or the forest fires around Moscow in 2010):

“Following the weather incidents in the Sverdlovsk and Chelyabinsk District where snow fell last weekend, a natural anomaly occurred in Novosibirsk, resulting in human casualties … Two three-year-old twin sisters died after a tree fell on them during a strong wind storm in the town of Berdsk, Novosibirsk District.”

“The flood in Yakutia lasted a week and resulted in the submersion of Ozhulun village in Churapchinsky district last Saturday. Due to the rise of the Tatta River, 57 house went under.”

“Flooding in Tuapse [on the coast of the Black Sea] occurred on July 8, 2014 … [and] has left 236 citizens homeless.”

Cars swept away in July 2014 floods in Russia. Credit: takeme.ru

Is it not worrisome that so many climate disasters have to occur before Russian officials start to realise that climatologists are not lying? Or perhaps they are simply not inclined to take the climatologists’ warnings seriously.

Another significant problem could arise for Russia if oil consumers start taking U.N. climate warnings seriously – and there is evidence that this is happening.

The European Union (still the main consumer of Russian oil and gas) has announced an ambitious “20/20/20 programme” – increasing shares from renewables to 20 percent, improving energy efficiency by 20 percent, and decreasing carbon emissions by 20 percent. The United States has decided to decrease carbon emissions from power plants by 30 percent. These are only first steps – but even these steps can help decrease fossil fuel consumption.

Fossil fuel use has only very slowly been increasing in the United States and decreasing in Europe in the last five years. On the other hand, demand for oil has continued to rise in China and Southeast Asia, and it is perhaps this – rather than the recent “sanctions” against Russia over Ukraine – that inspired President Vladimir Putin’s recent “turn to the East”.

But there are serious doubts that Asia’s greed for oil will continue into the future. China recently admitted that it will soon be taking measures to limit carbon emissions – for the first time in its history. China has already turned to green energy andled the rest of the worldin renewable energy investment in 2013.

Will other Asian countries follow suit? Perhaps – because they certainly have a very strong incentive. According to Erin McCarthy writing in the Wall Street Journal, South and Southeast Asia’s losses due to global warming may be huge, and its GDP may be reduced by 6 percent by 2060, despite the measures taken to curb its emissions.

What does this mean for Russia?

Well, if the oil-consuming countries meet their carbon emission targets, we can expect a 10-20 percent decrease in oil demand in the next ten years, maybe more. Any decrease in demand usually induces a decrease in price – but not always proportionally. Sometimes, especially if the market is overheated, even a small decrease in demand can trigger a drastic falls in price. Economists call such a situation a “bursting bubble”.

Today, the situation in the oil (and, in general, fossil fuel) market is often called a “carbon bubble”. Because of high oil prices, investors are motivated to make investments in oil drilling in the hopes of earning a stable and long-term income.

But once the world starts taking climate issues seriously and realises that most of the oil needs to be left in the ground, oil assets will fall in value. Investors will try to withdraw their money from the fossil fuel sector, and, facing a crisis, oil companies will be forced to decrease both production and prices.

If the “carbon bubble” bursts, Russia will be left with sustainable businesses (that are being choked by the nation’s own tax politics) and with a perfect network of shelf platforms, oil rigs, and pipelines (which will be completely unprofitable and useless). Thus, by making fossil fuels the core of its economy, Russia is taking twice the number of risks.

First, it risks ruining the climate, and second, it risks ruining its own economy. It looks like Russia will lose at any rate: if the leading energy consumers are unable to decrease their oil consumption, the climate will be ruined everywhere, including Russia. If they manage to decrease their dependence on fossil fuel, the Russian economy will be ruined.

This certainly is not looking pleasant, especially if we add in the high probability of a major disaster like the Gulf of Mexico Oil spill happening in the Arctic, as well as countless minor leaks possibly occurring along the Russian pipelines.

But maybe Russia just has no other alternative to an economy dependent on fossil fuels?

In that case, perhaps it is worth mentioning a recent article by Russian financier Andrei Movchan in the Russian Forbes magazine. Movchan convincingly shows that the Achilles’ heel of the modern Russian economy is its extremely underdeveloped small and medium-sized businesses. And it looks like the current tax plans would literally exterminate them.

If Russia were able to reverse this tax policy and make small businesses play as big of a role in the economy as they do in the United States or Europe, there could be economic growth comparable to the growth expected from oil and gas – without all the frightful side effects of an economy driven by fossil fuels.

Sounds like a dream, but the first step to making it a reality can be simple: get rid of big oil lobbying in the government and try to reform the taxation system to suit the interests of Russian citizens instead of the interests of the big oil corporations.

(Edited by Phil Harris)

* Mikhail Matveev is 350.org Communications Coordinator for Eastern Europe, Caucasus, Central Asia and Russia