Showing posts with label gas. Show all posts
Showing posts with label gas. Show all posts
Saturday 3 September 2022
Tuesday 17 April 2018
An Alternative View - The Gas Attack on Douma, Syria
Robert Fisk in The Independent
This is the story of a town called Douma, a ravaged, stinking place of smashed apartment blocks – and of an underground clinic whose images of suffering allowed three of the Western world’s most powerful nations to bomb Syria last week. There’s even a friendly doctor in a green coat who, when I track him down in the very same clinic, cheerfully tells me that the “gas” videotape which horrified the world – despite all the doubters – is perfectly genuine.
War stories, however, have a habit of growing darker. For the same 58-year old senior Syrian doctor then adds something profoundly uncomfortable: the patients, he says, were overcome not by gas but by oxygen starvation in the rubbish-filled tunnels and basements in which they lived, on a night of wind and heavy shelling that stirred up a dust storm.
As Dr Assim Rahaibani announces this extraordinary conclusion, it is worth observing that he is by his own admission not an eyewitness himself and, as he speaks good English, he refers twice to the jihadi gunmen of Jaish el-Islam [the Army of Islam] in Douma as “terrorists” – the regime’s word for their enemies, and a term used by many people across Syria. Am I hearing this right? Which version of events are we to believe?
By bad luck, too, the doctors who were on duty that night on 7 April were all in Damascus giving evidence to a chemical weapons enquiry, which will be attempting to provide a definitive answer to that question in the coming weeks.
France, meanwhile, has said it has “proof” chemical weapons were used, and US media have quoted sources saying urine and blood tests showed this too. The WHO has said its partners on the ground treated 500 patients “exhibiting signs and symptoms consistent with exposure to toxic chemicals”.
At the same time, inspectors from the Organisation for the Prohibition of Chemical Weapons (OPCW) are currently blocked from coming here to the site of the alleged gas attack themselves, ostensibly because they lacked the correct UN permits.
Before we go any further, readers should be aware that this is not the only story in Douma. There are the many people I talked to amid the ruins of the town who said they had “never believed in” gas stories – which were usually put about, they claimed, by the armed Islamist groups. These particular jihadis survived under a blizzard of shellfire by living in other’s people’s homes and in vast, wide tunnels with underground roads carved through the living rock by prisoners with pick-axes on three levels beneath the town. I walked through three of them yesterday, vast corridors of living rock which still contained Russian – yes, Russian – rockets and burned-out cars.
So the story of Douma is thus not just a story of gas – or no gas, as the case may be. It’s about thousands of people who did not opt for evacuation from Douma on buses that left last week, alongside the gunmen with whom they had to live like troglodytes for months in order to survive. I walked across this town quite freely yesterday without soldier, policeman or minder to haunt my footsteps, just two Syrian friends, a camera and a notebook. I sometimes had to clamber across 20-foot-high ramparts, up and down almost sheer walls of earth. Happy to see foreigners among them, happier still that the siege is finally over, they are mostly smiling; those whose faces you can see, of course, because a surprising number of Douma’s women wear full-length black hijab.
I first drove into Douma as part of an escorted convoy of journalists. But once a boring general had announced outside a wrecked council house “I have no information” – that most helpful rubbish-dump of Arab officialdom – I just walked away. Several other reporters, mostly Syrian, did the same. Even a group of Russian journalists – all in military attire – drifted off.
It was a short walk to Dr Rahaibani. From the door of his subterranean clinic – “Point 200”, it is called, in the weird geology of this partly-underground city – is a corridor leading downhill where he showed me his lowly hospital and the few beds where a small girl was crying as nurses treated a cut above her eye.
“I was with my family in the basement of my home three hundred metres from here on the night but all the doctors know what happened. There was a lot of shelling [by government forces] and aircraft were always over Douma at night – but on this night, there was wind and huge dust clouds began to come into the basements and cellars where people lived. People began to arrive here suffering from hypoxia, oxygen loss. Then someone at the door, a “White Helmet”, shouted “Gas!”, and a panic began. People started throwing water over each other. Yes, the video was filmed here, it is genuine, but what you see are people suffering from hypoxia – not gas poisoning.”
Independent Middle East Correspondent Robert Fisk in one of the miles of tunnels hacked beneath Douma by prisoners of Syrian rebels (Yara Ismail)
How could it be that Douma refugees who had reached camps in Turkey were already describing a gas attack which no-one in Douma today seemed to recall? It did occur to me, once I was walking for more than a mile through these wretched prisoner-groined tunnels, that the citizens of Douma lived so isolated from each other for so long that “news” in our sense of the word simply had no meaning to them. Syria doesn’t cut it as Jeffersonian democracy – as I cynically like to tell my Arab colleagues – and it is indeed a ruthless dictatorship, but that couldn’t cow these people, happy to see foreigners among them, from reacting with a few words of truth. So what were they telling me?
They talked about the Islamists under whom they had lived. They talked about how the armed groups had stolen civilian homes to avoid the Syrian government and Russian bombing. The Jaish el-Islam had burned their offices before they left, but the massive buildings inside the security zones they created had almost all been sandwiched to the ground by air strikes. A Syrian colonel I came across behind one of these buildings asked if I wanted to see how deep the tunnels were. I stopped after well over a mile when he cryptically observed that “this tunnel might reach as far as Britain”. Ah yes, Ms May, I remembered, whose air strikes had been so intimately connected to this place of tunnels and dust. And gas?
This is the story of a town called Douma, a ravaged, stinking place of smashed apartment blocks – and of an underground clinic whose images of suffering allowed three of the Western world’s most powerful nations to bomb Syria last week. There’s even a friendly doctor in a green coat who, when I track him down in the very same clinic, cheerfully tells me that the “gas” videotape which horrified the world – despite all the doubters – is perfectly genuine.
War stories, however, have a habit of growing darker. For the same 58-year old senior Syrian doctor then adds something profoundly uncomfortable: the patients, he says, were overcome not by gas but by oxygen starvation in the rubbish-filled tunnels and basements in which they lived, on a night of wind and heavy shelling that stirred up a dust storm.
As Dr Assim Rahaibani announces this extraordinary conclusion, it is worth observing that he is by his own admission not an eyewitness himself and, as he speaks good English, he refers twice to the jihadi gunmen of Jaish el-Islam [the Army of Islam] in Douma as “terrorists” – the regime’s word for their enemies, and a term used by many people across Syria. Am I hearing this right? Which version of events are we to believe?
By bad luck, too, the doctors who were on duty that night on 7 April were all in Damascus giving evidence to a chemical weapons enquiry, which will be attempting to provide a definitive answer to that question in the coming weeks.
France, meanwhile, has said it has “proof” chemical weapons were used, and US media have quoted sources saying urine and blood tests showed this too. The WHO has said its partners on the ground treated 500 patients “exhibiting signs and symptoms consistent with exposure to toxic chemicals”.
At the same time, inspectors from the Organisation for the Prohibition of Chemical Weapons (OPCW) are currently blocked from coming here to the site of the alleged gas attack themselves, ostensibly because they lacked the correct UN permits.
Before we go any further, readers should be aware that this is not the only story in Douma. There are the many people I talked to amid the ruins of the town who said they had “never believed in” gas stories – which were usually put about, they claimed, by the armed Islamist groups. These particular jihadis survived under a blizzard of shellfire by living in other’s people’s homes and in vast, wide tunnels with underground roads carved through the living rock by prisoners with pick-axes on three levels beneath the town. I walked through three of them yesterday, vast corridors of living rock which still contained Russian – yes, Russian – rockets and burned-out cars.
So the story of Douma is thus not just a story of gas – or no gas, as the case may be. It’s about thousands of people who did not opt for evacuation from Douma on buses that left last week, alongside the gunmen with whom they had to live like troglodytes for months in order to survive. I walked across this town quite freely yesterday without soldier, policeman or minder to haunt my footsteps, just two Syrian friends, a camera and a notebook. I sometimes had to clamber across 20-foot-high ramparts, up and down almost sheer walls of earth. Happy to see foreigners among them, happier still that the siege is finally over, they are mostly smiling; those whose faces you can see, of course, because a surprising number of Douma’s women wear full-length black hijab.
I first drove into Douma as part of an escorted convoy of journalists. But once a boring general had announced outside a wrecked council house “I have no information” – that most helpful rubbish-dump of Arab officialdom – I just walked away. Several other reporters, mostly Syrian, did the same. Even a group of Russian journalists – all in military attire – drifted off.
It was a short walk to Dr Rahaibani. From the door of his subterranean clinic – “Point 200”, it is called, in the weird geology of this partly-underground city – is a corridor leading downhill where he showed me his lowly hospital and the few beds where a small girl was crying as nurses treated a cut above her eye.
“I was with my family in the basement of my home three hundred metres from here on the night but all the doctors know what happened. There was a lot of shelling [by government forces] and aircraft were always over Douma at night – but on this night, there was wind and huge dust clouds began to come into the basements and cellars where people lived. People began to arrive here suffering from hypoxia, oxygen loss. Then someone at the door, a “White Helmet”, shouted “Gas!”, and a panic began. People started throwing water over each other. Yes, the video was filmed here, it is genuine, but what you see are people suffering from hypoxia – not gas poisoning.”
Independent Middle East Correspondent Robert Fisk in one of the miles of tunnels hacked beneath Douma by prisoners of Syrian rebels (Yara Ismail)
Oddly, after chatting to more than 20 people, I couldn’t find one who showed the slightest interest in Douma’s role in bringing about the Western air attacks. Two actually told me they didn’t know about the connection.
But it was a strange world I walked into. Two men, Hussam and Nazir Abu Aishe, said they were unaware how many people had been killed in Douma, although the latter admitted he had a cousin “executed by Jaish el-Islam [the Army of Islam] for allegedly being “close to the regime”. They shrugged when I asked about the 43 people said to have died in the infamous Douma attack.
The White Helmets – the medical first responders already legendary in the West but with some interesting corners to their own story – played a familiar role during the battles. They are partly funded by the Foreign Office and most of the local offices were staffed by Douma men. I found their wrecked offices not far from Dr Rahaibani’s clinic. A gas mask had been left outside a food container with one eye-piece pierced and a pile of dirty military camouflage uniforms lay inside one room. Planted, I asked myself? I doubt it. The place was heaped with capsules, broken medical equipment and files, bedding and mattresses.
Of course we must hear their side of the story, but it will not happen here: a woman told us that every member of the White Helmets in Douma abandoned their main headquarters and chose to take the government-organised and Russian-protected buses to the rebel province of Idlib with the armed groups when the final truce was agreed.
There were food stalls open and a patrol of Russian military policemen – a now optional extra for every Syrian ceasefire – and no-one had even bothered to storm into the forbidding Islamist prison near Martyr’s Square where victims were supposedly beheaded in the basements. The town’s complement of Syrian interior ministry civilian police – who eerily wear military clothes – are watched over by the Russians who may or may not be watched by the civilians. Again, my earnest questions about gas were met with what seemed genuine perplexity.
But it was a strange world I walked into. Two men, Hussam and Nazir Abu Aishe, said they were unaware how many people had been killed in Douma, although the latter admitted he had a cousin “executed by Jaish el-Islam [the Army of Islam] for allegedly being “close to the regime”. They shrugged when I asked about the 43 people said to have died in the infamous Douma attack.
The White Helmets – the medical first responders already legendary in the West but with some interesting corners to their own story – played a familiar role during the battles. They are partly funded by the Foreign Office and most of the local offices were staffed by Douma men. I found their wrecked offices not far from Dr Rahaibani’s clinic. A gas mask had been left outside a food container with one eye-piece pierced and a pile of dirty military camouflage uniforms lay inside one room. Planted, I asked myself? I doubt it. The place was heaped with capsules, broken medical equipment and files, bedding and mattresses.
Of course we must hear their side of the story, but it will not happen here: a woman told us that every member of the White Helmets in Douma abandoned their main headquarters and chose to take the government-organised and Russian-protected buses to the rebel province of Idlib with the armed groups when the final truce was agreed.
There were food stalls open and a patrol of Russian military policemen – a now optional extra for every Syrian ceasefire – and no-one had even bothered to storm into the forbidding Islamist prison near Martyr’s Square where victims were supposedly beheaded in the basements. The town’s complement of Syrian interior ministry civilian police – who eerily wear military clothes – are watched over by the Russians who may or may not be watched by the civilians. Again, my earnest questions about gas were met with what seemed genuine perplexity.
How could it be that Douma refugees who had reached camps in Turkey were already describing a gas attack which no-one in Douma today seemed to recall? It did occur to me, once I was walking for more than a mile through these wretched prisoner-groined tunnels, that the citizens of Douma lived so isolated from each other for so long that “news” in our sense of the word simply had no meaning to them. Syria doesn’t cut it as Jeffersonian democracy – as I cynically like to tell my Arab colleagues – and it is indeed a ruthless dictatorship, but that couldn’t cow these people, happy to see foreigners among them, from reacting with a few words of truth. So what were they telling me?
They talked about the Islamists under whom they had lived. They talked about how the armed groups had stolen civilian homes to avoid the Syrian government and Russian bombing. The Jaish el-Islam had burned their offices before they left, but the massive buildings inside the security zones they created had almost all been sandwiched to the ground by air strikes. A Syrian colonel I came across behind one of these buildings asked if I wanted to see how deep the tunnels were. I stopped after well over a mile when he cryptically observed that “this tunnel might reach as far as Britain”. Ah yes, Ms May, I remembered, whose air strikes had been so intimately connected to this place of tunnels and dust. And gas?
Tuesday 24 November 2015
There’s a population crisis all right. But probably not the one you think
While all eyes are on human numbers, it’s the rise in farm animals that is laying the planet waste
A recent paper in the journal Science of the Total Environment suggests that our consumption of meat is likely to be “the leading cause of modern species extinctions”. Not only is livestock farming the major reason for habitat destruction and the killing of predators, but its waste products are overwhelming the world’s capacity to absorb them. Factory farms in the US generate 13 times as much sewage as the human population does. The dairy farms in Tulare County, California, produce five times as much as New York City.
Freshwater life is being wiped out across the world by farm manure. In England the system designed to protect us from the tide of slurry has comprehensively broken down. Dead zones now extend from many coasts, as farm sewage erases ocean life across thousands of square kilometres.
Livestock farming creates around 14% of the world’s greenhouse gas emissions: slightly more than the output of the world’s cars, lorries, buses, trains, ships and planes. If you eat soya, your emissions per unit of protein are 20 times lower than eating pork or chicken, and 150 times lower than eating beef.
So why is hardly anyone talking about the cow, pig, sheep and chicken in the room? Why are there no government campaigns to reduce the consumption of animal products, just as they sometimes discourage our excessive use of electricity?
‘By 2050 the world’s living systems will have to support about 120m tonnes of extra humans, and 400m tonnes of extra farm animals.’ Illustration by Nate Kitch
GeorgeMonbiot in The Guardian
This column is about the population crisis. About the breeding that’s laying waste the world’s living systems. But it’s probably not the population crisis you’re thinking of. This is about another one, that we seem to find almost impossible to discuss.
You’ll hear a lot about population in the next three weeks, as the Paris climate summit approaches. Across the airwaves and on the comment threads it will invariably be described as “the elephant in the room”. When people are not using their own words, it means that they are not thinking their own thoughts. Ten thousand voices each ask why no one is talking about it. The growth in human numbers, they say, is our foremost environmental threat.
At their best, population campaigners seek to extend women’s reproductive choices. Some 225 million women have an unmet need for contraception. If this need were answered, the impact on population growth would be significant, though not decisive: the annual growth rate of 83 million would be reduced to 62 million. But contraception is rarely limited only by the physical availability of contraceptives. In most cases it’s about power: women are denied control of their wombs. The social transformations that they need are wider and deeper than donations from the other side of the world are likely to achieve.
At their worst, population campaigners seek to shift the blame from their own environmental impacts. Perhaps it’s no coincidence that so many post-reproductive white men are obsessed with human population growth, as it’s about the only environmental problem of which they can wash their hands. Nor, I believe, is it a coincidence that of all such topics this is the least tractable. When there is almost nothing to be done, there is no requirement to act.
Such is the momentum behind population growth, an analysis in the Proceedings of the National Academy of Sciences discovered, that were every government to adopt the one-child policy China has just abandoned, there would still be as many people on Earth at the end of this century as there are today. If 2 billion people were wiped out by a catastrophe mid-century, the planet would still hold a billion more by 2100 than it does now.
If we want to reduce our impacts this century, the paper concludes, it is consumption we must address. Population growth is outpaced by the growth in our consumption of almost all resources. There is enough to meet everyone’s need, even in a world of 10 billion people. There is not enough to meet everyone’s greed, even in a world of 2 billion people.
So let’s turn to a population crisis over which we do have some influence. I’m talking about the growth in livestock numbers. Human numbers are rising at roughly 1.2% a year, while livestock numbers are rising at around 2.4% a year. By 2050 the world’s living systems will have to support about 120m tonnes of extra humans, and 400m tonnes of extra farm animals.
Raising these animals already uses three-quarters of the world’s agricultural land.A third of our cereal crops are used to feed livestock: this may rise to roughly half by 2050. More people will starve as a result, because the poor rely mainly on grain for their subsistence, and diverting it to livestock raises the price. And now the grain that farm animals consume is being supplemented by oil crops, particularly soya, for which the forests and savannahs of South America are being cleared at shocking rates.
This might seem counter-intuitive, but were we to eat soya rather than meat, the clearance of natural vegetation required to supply us with the same amount of protein would decline by 94%. Producing protein from chickens requires three times as much land as protein from soybeans. Pork needs nine times, beef 32 times.
GeorgeMonbiot in The Guardian
This column is about the population crisis. About the breeding that’s laying waste the world’s living systems. But it’s probably not the population crisis you’re thinking of. This is about another one, that we seem to find almost impossible to discuss.
You’ll hear a lot about population in the next three weeks, as the Paris climate summit approaches. Across the airwaves and on the comment threads it will invariably be described as “the elephant in the room”. When people are not using their own words, it means that they are not thinking their own thoughts. Ten thousand voices each ask why no one is talking about it. The growth in human numbers, they say, is our foremost environmental threat.
At their best, population campaigners seek to extend women’s reproductive choices. Some 225 million women have an unmet need for contraception. If this need were answered, the impact on population growth would be significant, though not decisive: the annual growth rate of 83 million would be reduced to 62 million. But contraception is rarely limited only by the physical availability of contraceptives. In most cases it’s about power: women are denied control of their wombs. The social transformations that they need are wider and deeper than donations from the other side of the world are likely to achieve.
At their worst, population campaigners seek to shift the blame from their own environmental impacts. Perhaps it’s no coincidence that so many post-reproductive white men are obsessed with human population growth, as it’s about the only environmental problem of which they can wash their hands. Nor, I believe, is it a coincidence that of all such topics this is the least tractable. When there is almost nothing to be done, there is no requirement to act.
Such is the momentum behind population growth, an analysis in the Proceedings of the National Academy of Sciences discovered, that were every government to adopt the one-child policy China has just abandoned, there would still be as many people on Earth at the end of this century as there are today. If 2 billion people were wiped out by a catastrophe mid-century, the planet would still hold a billion more by 2100 than it does now.
If we want to reduce our impacts this century, the paper concludes, it is consumption we must address. Population growth is outpaced by the growth in our consumption of almost all resources. There is enough to meet everyone’s need, even in a world of 10 billion people. There is not enough to meet everyone’s greed, even in a world of 2 billion people.
So let’s turn to a population crisis over which we do have some influence. I’m talking about the growth in livestock numbers. Human numbers are rising at roughly 1.2% a year, while livestock numbers are rising at around 2.4% a year. By 2050 the world’s living systems will have to support about 120m tonnes of extra humans, and 400m tonnes of extra farm animals.
Raising these animals already uses three-quarters of the world’s agricultural land.A third of our cereal crops are used to feed livestock: this may rise to roughly half by 2050. More people will starve as a result, because the poor rely mainly on grain for their subsistence, and diverting it to livestock raises the price. And now the grain that farm animals consume is being supplemented by oil crops, particularly soya, for which the forests and savannahs of South America are being cleared at shocking rates.
This might seem counter-intuitive, but were we to eat soya rather than meat, the clearance of natural vegetation required to supply us with the same amount of protein would decline by 94%. Producing protein from chickens requires three times as much land as protein from soybeans. Pork needs nine times, beef 32 times.
A recent paper in the journal Science of the Total Environment suggests that our consumption of meat is likely to be “the leading cause of modern species extinctions”. Not only is livestock farming the major reason for habitat destruction and the killing of predators, but its waste products are overwhelming the world’s capacity to absorb them. Factory farms in the US generate 13 times as much sewage as the human population does. The dairy farms in Tulare County, California, produce five times as much as New York City.
Freshwater life is being wiped out across the world by farm manure. In England the system designed to protect us from the tide of slurry has comprehensively broken down. Dead zones now extend from many coasts, as farm sewage erases ocean life across thousands of square kilometres.
Livestock farming creates around 14% of the world’s greenhouse gas emissions: slightly more than the output of the world’s cars, lorries, buses, trains, ships and planes. If you eat soya, your emissions per unit of protein are 20 times lower than eating pork or chicken, and 150 times lower than eating beef.
So why is hardly anyone talking about the cow, pig, sheep and chicken in the room? Why are there no government campaigns to reduce the consumption of animal products, just as they sometimes discourage our excessive use of electricity?
A factory farm in Missouri, USA. ‘Why is hardly anyone talking about the cow, pig, sheep and chicken in the room?’ Photograph: Daniel Pepper/Getty Images
A survey by the Royal Institute of International Affairs found that people are not unwilling to change diets once they become aware of the problem, but that many have no idea that livestock farming damages the living world.
It’s not as if eating less meat and dairy will harm us. If we did as our doctors advise, our environmental impacts would decline in step with heart disease, strokes, diabetes and cancer. British people eat, on average, slightly more than their bodyweight in meat every year, while Americans consume another 50%: wildly more, in both cases, than is good for us or the rest of life on Earth.
But while plenty in the rich world are happy to discuss the dangers of brown people reproducing, the other population crisis scarcely crosses the threshold of perception. Livestock numbers present a direct moral challenge, as in this case we have agency. Hence the pregnant silence.
A survey by the Royal Institute of International Affairs found that people are not unwilling to change diets once they become aware of the problem, but that many have no idea that livestock farming damages the living world.
It’s not as if eating less meat and dairy will harm us. If we did as our doctors advise, our environmental impacts would decline in step with heart disease, strokes, diabetes and cancer. British people eat, on average, slightly more than their bodyweight in meat every year, while Americans consume another 50%: wildly more, in both cases, than is good for us or the rest of life on Earth.
But while plenty in the rich world are happy to discuss the dangers of brown people reproducing, the other population crisis scarcely crosses the threshold of perception. Livestock numbers present a direct moral challenge, as in this case we have agency. Hence the pregnant silence.
Sunday 29 September 2013
Time to get cracking on fracking
S A Aiyer
After years of consideration, the government has come out with a disappointing shale gas policy. The public sector companies, ONGC and Oil India, will be allowed to drill for shale oil and gas in blocks they already have, but fresh auctions will be conducted for all other shale deposits. Private sector companies will not be allowed to exploit shale formations in their existing blocks. This means delay and unwarranted red tape. There is little reason to have separate auctions for conventional and non-conventional oil and gas.
Shale gas and oil have changed the face of the US. Huge increases in production have taken the US close to self-sufficiency in oil, and created a big gas surplus. By 2020, the US may get all its energy needs from its own fields and those of Mexico and Canada, eliminating the need for oil from the Middle East or Latin America. India’s prospects are much poorer. Yet preliminary data suggest that India has 63 trillion cu. ft of shale gas, 20 times as much as in Reliance’s offshore field. Additional prospecting could raise reserves considerably.
One good feature: the new policy mandates auctions based on simple production sharing between the explorer and government. The current cost-plus system has led to endless disputes in Reliance’s case. This new policy will apply to conventional as well as non-conventional deposits.
The question remains, why treat shale gas as different from conventional natural gas?
Gas and oil have been formed by the decay under great pressure and heat of marine life trapped in sands millions of years ago. Conventional oil and gas are produced by drilling into rock formations that are porous (lots of holes in the rock) and permeable (the holes are interconnected, letting the oil/gas to flow out under its own pressure). Limestone and sandstone are rocks with good flow rates. But other rock formations can be “tight”, having low porosity and permeability, in which oil does not flow easily.
This is true of shale and some other rock formations. These formations have long been known to contain enormous deposits, but extracting them was earlier not economically viable. Then a new technology, fracking, was devised in the 1990s. It used horizontal drilling and highpressure water with sand to crack open tight formations. This improved the flow enough to make drilling viable.
Now, many oil and gas deposits lie in multiple layers of different rocks. Thick sandstone and limestone formations may be interspersed with shale layers. The oil and gas lie trapped in all the layers, but conventionally were extracted only from the easy-flowing ones. Now they can be extracted from the tight layers too.
Does it make sense to decree that an explorer can touch only conventional strata and not tight layers, which should be auctioned to a separate company? Is it logical to have two companies drilling in the same block, one in the limestone strata and another in the shale? Apart from the duplication in cost and effort, it could lead to endless disputes and litigation. It could jeopardize safe field development too.
The US makes no distinctions. An explorer strikes deals with landowners, and can extract any gas or oil from any sort of rock. After all, nobody knows in advance whether oil or gas will be discovered, and if so in what sort of rock.
Exploration policy in India should similarly have no distinctions in exploration policy. However, fracking will need separate environmental clearance, because it poses special challenges.
Fracking needs very large quantities of water, mixed with chemicals, for blasting open tight formations. Waste water after fracking could contain toxic chemicals, and so must not be dumped.
To begin with, fracking in India can be limited to areas with abundant water. Only deep aquifers should be tapped for fracking, avoiding shallow aquifers used for irrigation or drinking water. Maybe sea water can be used in coastal locations.
Second, waste water after fracking must be recycled for use in new wells, not dumped. This will not only check toxic hazards but reduce the water needed for additional wells. Only certified safe chemicals should be used for fracking.
If surplus fracked water is pumped underground for disposal, it can cause small tremors (misleadingly reported as “earthquakes” by activists). This can be managed by gradual, deep disposal.
Activists will undoubtedly ask the courts to ban fracking, even though not a single case of contamination has been established after two decades in the US. The government should get an advance ruling on this from the Supreme Court, clarifying conditions under which fracking can take place. This may take a few years, so we need to start forthwith.
After years of consideration, the government has come out with a disappointing shale gas policy. The public sector companies, ONGC and Oil India, will be allowed to drill for shale oil and gas in blocks they already have, but fresh auctions will be conducted for all other shale deposits. Private sector companies will not be allowed to exploit shale formations in their existing blocks. This means delay and unwarranted red tape. There is little reason to have separate auctions for conventional and non-conventional oil and gas.
Shale gas and oil have changed the face of the US. Huge increases in production have taken the US close to self-sufficiency in oil, and created a big gas surplus. By 2020, the US may get all its energy needs from its own fields and those of Mexico and Canada, eliminating the need for oil from the Middle East or Latin America. India’s prospects are much poorer. Yet preliminary data suggest that India has 63 trillion cu. ft of shale gas, 20 times as much as in Reliance’s offshore field. Additional prospecting could raise reserves considerably.
One good feature: the new policy mandates auctions based on simple production sharing between the explorer and government. The current cost-plus system has led to endless disputes in Reliance’s case. This new policy will apply to conventional as well as non-conventional deposits.
The question remains, why treat shale gas as different from conventional natural gas?
Gas and oil have been formed by the decay under great pressure and heat of marine life trapped in sands millions of years ago. Conventional oil and gas are produced by drilling into rock formations that are porous (lots of holes in the rock) and permeable (the holes are interconnected, letting the oil/gas to flow out under its own pressure). Limestone and sandstone are rocks with good flow rates. But other rock formations can be “tight”, having low porosity and permeability, in which oil does not flow easily.
This is true of shale and some other rock formations. These formations have long been known to contain enormous deposits, but extracting them was earlier not economically viable. Then a new technology, fracking, was devised in the 1990s. It used horizontal drilling and highpressure water with sand to crack open tight formations. This improved the flow enough to make drilling viable.
Now, many oil and gas deposits lie in multiple layers of different rocks. Thick sandstone and limestone formations may be interspersed with shale layers. The oil and gas lie trapped in all the layers, but conventionally were extracted only from the easy-flowing ones. Now they can be extracted from the tight layers too.
Does it make sense to decree that an explorer can touch only conventional strata and not tight layers, which should be auctioned to a separate company? Is it logical to have two companies drilling in the same block, one in the limestone strata and another in the shale? Apart from the duplication in cost and effort, it could lead to endless disputes and litigation. It could jeopardize safe field development too.
The US makes no distinctions. An explorer strikes deals with landowners, and can extract any gas or oil from any sort of rock. After all, nobody knows in advance whether oil or gas will be discovered, and if so in what sort of rock.
Exploration policy in India should similarly have no distinctions in exploration policy. However, fracking will need separate environmental clearance, because it poses special challenges.
Fracking needs very large quantities of water, mixed with chemicals, for blasting open tight formations. Waste water after fracking could contain toxic chemicals, and so must not be dumped.
To begin with, fracking in India can be limited to areas with abundant water. Only deep aquifers should be tapped for fracking, avoiding shallow aquifers used for irrigation or drinking water. Maybe sea water can be used in coastal locations.
Second, waste water after fracking must be recycled for use in new wells, not dumped. This will not only check toxic hazards but reduce the water needed for additional wells. Only certified safe chemicals should be used for fracking.
If surplus fracked water is pumped underground for disposal, it can cause small tremors (misleadingly reported as “earthquakes” by activists). This can be managed by gradual, deep disposal.
Activists will undoubtedly ask the courts to ban fracking, even though not a single case of contamination has been established after two decades in the US. The government should get an advance ruling on this from the Supreme Court, clarifying conditions under which fracking can take place. This may take a few years, so we need to start forthwith.
Tuesday 10 September 2013
Reliance Energy Pricing - Selling the dream for a song
The Hindu
The government has spared no effort to convince the public that its gas pricing formula, skewed in favour of Reliance, will be the solution to India's energy needs
Politicians worldwide are dream merchants. They sell dreams. Indian politicians are, of course, second to none in this business and have indeed perfected this art form. Their success in selling pipe dreams is perhaps a measure of the depth of our despair as a nation. Can any Indian, my age, forget the euphoria that the dream of “Garibi Hatao” created in the 1970s? Some 40 plus years later, the same Congress party is telling the nation that 70 per cent of people now need food subsidy to survive. Of course, its minions in the Planning Commission are running out of newly sharpened pencils convincing the nation that poverty has reduced significantly. They see no contradiction between the claimed lowering of poverty and the proposed food security bill that has its foundation in the fact that 70 per cent of Indians cannot even buy sufficient food to survive today.
Rangarajan formula
Veerappa Moily, an old Congress satrap, is a highly decorated warrior of many election battles. As an experienced dream merchant, he is selling the Rangarajan formula for pricing gas as the panacea to India’s energy security woes. No one has answered any of the direct questions that I have asked in my four articles in The Hindu since the Rangarajan Committee report surfaced. However, deceptive claims have kept appearing in the press about the wisdom of pricing natural gas as proposed by Dr. Rangarajan. And since no one was buying their arguments, the powers-that-be took out their most lethal weapon — the pen of the Honourable Minister himself to destroy non-believers like myself. Unfortunately, some of the statements in Mr. Moily’s op-ed of August 7, 2013 in the Times of India come straight out of a recent Annual Report of Reliance.
My issue is with our dream merchants and not with Reliance for it, like any private enterprise, responds efficiently and effectively to shape the prevailing environment and maximise profits. So let me cut short the song and dance and pose some straight questions to the Honourable Minister.
1. Can the Honourable Minister list the $100 billion that Indian companies have invested or committed to date for oil and gas assets overseas? The actual investment to date is under $25 billion and I honestly wish it was four times higher as claimed by the Honourable Minister. Although there are huge cans of worms under some of the overseas acquisitions we have made, the truth is that for every dollar invested overseas we have accrued more oil and gas reserves than for the same dollar invested in the Indian sedimentary basin. Large and serious global investors in oil and gas go where the prospects are the best. I am proud that despite a few questionable deals, the Indian public sector (primarily OVL) took the lead in this while the domestic private sector concentrated on India — an environment it could efficiently and effectively manage for much higher monetary gains (not resource accretion).
2. Can the Honourable Minister name any country in the world that offered investors from India or elsewhere a formula such as that proposed by the Rangarajan Committee or, for that matter, a formula such as the one currently in use in India to lure exploration and production investments in conventional natural gas or oil?
3. Despite the price reforms in Brazil and China cited by the Honourable Minister, do either of these countries or for that matter any country in the world provide the kind of guaranteed well head price for conventional natural gas that we have been paying under the current formula or promising to pay under the Rangarajan formula from April 2014? Can the Honourable Minister name a single well head in the world that is currently receiving $8.40/MMBTU or anywhere close to it for conventional natural gas?
Doubtful claims
4. The Honourable Minister gives several numbers about potentially higher domestic productions that could have been realised by end-2013 and by 2014-15 from KG-D6 and the likely savings in LNG imports. The Honourable Minster blames his own government for failure to give timely approvals to Reliance to achieve these outputs. The validity of these claims, especially the basis for estimating avoided LNG imports, remains in doubt but, more importantly, is the Honourable Minister trashing the various findings of the CAG and the Parliamentary Committee on KG-D6? Is the Honourable Minister trashing the findings of his predecessor and the reports of his own Ministry and the DGH?
5. The Honourable Minister promises an additional production of 40 MMSCMD of gas annually “starting” 2016-17 and savings of $65 billion in LNG imports. This outcome, the Honourable Minister informs, is the direct result of the changes he has instituted in the way his Ministry had been operating and the use of the Rangarajan formula for pricing conventional natural gas at the well head. Again, leaving aside the dubiousness of the estimated savings on LNG imports, let me ask the Honourable Minster if he can guarantee the promised additional output. Will this additional output come from the existing fields or new fields with new investments? Will the additional output result from RIL belatedly fulfilling its long unmet commitments under the addendum to the agreed initial development plan as detailed by the CAG? Finally, will this additional production come from acreage that should have been relinquished years ago as pointed out by the CAG?
In closing, the Honourable Minister lets fly a “conservative” pipe dream of 100 tcf of gas unlocking “$1 trillion in value” — never mind the details or the basis. At IIM-Ahmedabad, one of my very famous professors always said that a policymaker must have her/his head in the clouds but the feet must remain firmly on the ground. Since my infancy, my mother always told me that thieves have no feet. Neither that famous professor nor my illiterate mother is alive today for me to ask them if dream merchants with heads in the clouds too have no feet!
Wednesday 14 November 2012
Energy pricing: the market is manipulation
As an oil industry whistleblower, I know the energy sector is even more flawed than this week's exposé of gas prices reveals
'The real problem lies not with gas, but crude oil – which is suffering perhaps the greatest market manipulation the world has seen.' Photograph: Getty Images
The Guardian's investigation into the alleged "Libor-like" fixing of UK gas prices was doubly ironic for me. The first irony is that, as director of compliance and market supervision of the International Petroleum Exchange (now ICE Futures Europe) in the 1990s, I was heavily involved in the development and legal architecture of the gas-market contract that has now allegedly been manipulated.
The second painful irony is that in 2000 the Guardian published detailed allegations made by me on very similar micro-manipulation of the International Petroleum Exchange's Brent futures contract-settlement prices. This systemic manipulation was so pervasive that traders referred to the on-exchange profits they made at the expense of the manipulators – who profited "off-exchange" – as "grab a grand".
Unfortunately, I described the manipulation as "systematic" – taken to mean that some of the players were routinely manipulating the price most of the time – rather than "systemic", where most of the players manipulate the market some of the time. On this basis the commissioner appointed to investigate my allegations rejected them, and in finest whistleblower tradition my reputation was destroyed: I lost my livelihood, home and marriage. Had the crude oil market been properly investigated at that time, subsequent oil market history would probably have been very different.
One thing I have come to realise since my failed attempt at whistleblowing is that the short-term trading exposed this week is only part of the problem. The malaise runs much deeper. If you want to find out who really has an interest in rigging the market, ask who benefits from medium- and long-term high commodity prices: it's the producers, stupid. From De Beers' diamond hoarding to coffee-grower cartels, if the history of commodity markets tells us anything it's that if producers can find leverage to support commodity prices, they will.
The real problem in the energy market lies not with gas, but crude oil – which is suffering perhaps the greatest market manipulation the world has seen. This is due to financialisation of markets which began in crude oil about 12 years ago, but only became significant from around 2005 onwards. From the mid-90s, a new type of investor entered the markets as investment banks created new vehicles – index funds, exchange traded funds and so on – which enabled investors to invest directly in equities, precious metals; commodities generally and above all, in energy, with a view to "hedging inflation". Rather than speculatively taking a risk in search of a profit, they sought only the return of their capital, and the preservation of the value of their investment relative to dollars, sterling and so on.
To understand what happened to oil, we just need to look at the Enron scandal. The fundamental scam perpetrated here was based on an ancient financing method known as "prepay". Quite simply, this occurs when producers sell their product at a discount for cash now, with delivery later. So via intermediary banks such as JP Morgan and Citigroup, Enron were able to opaquely obtain "off-balance sheet" financing disguised as commodity trades of which Enron's investors and creditors were blithely unaware.Essentially, Enron was borrowing dollars and lending commodities.
A similarly opaque prepay technique has been responsible since 2005 for the inflation of two oil market bubbles. The first – a private sector bubble – culminated in July 2008 in a spike to $147 a barrel, and then a collapse to $35, causing great pain to producers used to high prices. At this point key producers – facilitated by friendly investment banks – resorted to prepay to finance themselves, and a public sector bubble was rapidly inflated during 2009.
In my analysis, the US and Saudis then hit upon a strategy that loosely "pegged" the oil price against the dollar within an agreed trading range, keeping prices relatively stable. But this trick only worked until early 2011, after which Fukushima and supply shocks in Libya and Iran have caused more turmoil.
I believe that there is now virtually nothing holding the oil market up, and that when (not if) Iran reaches an accommodation with the US on terms similar to those spurned by Dick Cheney in 2003, we will see the oil market price fall, possibly dramatically.
I have been warning for some time that risk-averse investors – whose very presence in the market causes the inflation they wish to avoid – are taking a much higher level of market risk than they appreciate. If I am correct, this will – sooner rather than later – give rise to the next Great Regulatory Disaster.
Perhaps worse than this, and particularly relevant to my work on financial market resilience, there is a significant risk of the sort of discontinuity in market price that took place in the tin market in 1985 when the market price collapsed overnight, from the price level supported by producer cartel stockpiling of $8,000 a tonne to the much lower price of $4000 a tonne, which reflected the influx of new low-cost tin supply.
The presence in the market of middlemen who have an interest in volatility and opacity means that we have now reached a stage where market manipulation is no longer an aberration: the market is the manipulation.
So what can be done? In the long term, crude oil prices can only go up, and many would argue that for the sake of the environment it is essential that carbon fuel prices are set at levels at which demand is low. The problem then is how best to distribute interationally and domestically the surplus value thereby created, in particular in investment in renewable energy, and above all in the cheapest energy of all – energy savings.
This will require a new (in fact very old) – and non-toxic – type of market architecture, and the good news is that this are already emerging as the current market paradigm approaches its end.
Sunday 21 October 2012
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