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Big Oil And Big Lithium | Earth Wise

July 7, 2023 By EarthWise Leave a Comment

The world’s big oil companies have worked pretty hard to prolong society’s dependence on petroleum. When there are trillions of dollars at stake, there is plenty of motivation. But those companies do see the writing on the wall.

An Exxon Mobil-funded study last year estimated that light-duty vehicle demand for combustion engine fuels could peak in 2025 and that electric vehicles of various types could grow to more than 50% of new car sales by 2050. This is pretty pessimistic compared with most other surveys, but it is still a big number. Exxon also projected that the global fleet of EVs could reach 420 million by 2040.

As a result of all this, Exxon is preparing for a future far less dependent on gasoline by drilling for lithium rather than oil. The company recently purchased mining rights to a sizable chunk of Arkansas land for over $100 million from which it aims to produce lithium for electric car batteries.

Exxon’s consultants estimated that the 120,000 acres in the Smackover formation of southern Arkansas could have as much as 4 million tons of lithium carbonate, enough to power 50 million cars and trucks.

Exxon plans to spend $17 billion through 2027 on cutting carbon emissions and developing low carbon technologies. Other large oil producers have also been looking at the lithium business. At the same time, some large oil companies like BP and Shell are investing in renewable energy.

The prospect of EVs dominating transportation in the coming decades is a strong incentive for oil-and-gas companies to adapt their businesses to the new world.

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Exxon Joins Hunt for Lithium in Bet on EV Boom

Photo, posted August 16, 2014, courtesy of Mike Mozart via Flickr.

Earth Wise is a production of WAMC Northeast Public Radio

Abandoned Oil Wells In The Gulf Of Mexico | Earth Wise

June 7, 2023 By EarthWise Leave a Comment

There have been offshore oil platforms in the Gulf of Mexico for 85 years. After all those decades of drilling, there are now more than 14,000 old, unplugged wells out in the water, and they are at risk of springing dangerous leaks and spills. There are now more unplugged, non-producing wells than active wells in the gulf. According to a new study, plugging all those abandoned wells could cost more than $30 billion.

Most of these wells are in federal waters and nearly 90% of them were owned at some point by one of the so-called supermajor oil companies: BP, Shell, Chevron, and Exxon. Under federal law, those companies would still be responsible for cleanup costs, even if they might have sold the wells in the past.

Oil and gas companies are legally responsible for plugging wells that are no longer in service, but such companies often go bankrupt, leaving wells orphaned and unplugged and taxpayers end up footing the bill. The 2021 trillion-dollar infrastructure bill sets aside $4.7 billion to plug orphaned wells, but that is nowhere near enough.

It may be possible to go after the supermajors to get them to pay for plugging wells in federal waters, but it will undoubtedly be a battle. In state waters, whose wells are generally in shallower locations, it is even more urgent to act because any pollution from the wells is more likely to reach shore and wreak environmental havoc.

As the world starts to transition away from fossil fuels, decades of mining and drilling in almost every corner of the world, including the oceans, has left behind the need for an immense plugging and cleanup effort.

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Price to Plug Old Wells in Gulf of Mexico? $30 Billion, Study Says

Photo, posted July 8, 2010, courtesy of John Masson / Coast Guard via Flickr.

Earth Wise is a production of WAMC Northeast Public Radio

A Tough Day For Big Oil | Earth Wise

June 24, 2021 By EarthWise Leave a Comment

May 26th was a difficult day for big oil. Three major setbacks for the industry occurred on the same day.

A Dutch court ruled in a case against Shell, ordering the company to cut emissions by 2030 in accordance with the goals of the Paris Climate Agreement. The case was brought by climate activists, ultimately comprising 17,000 co-plaintiffs. The ruling will probably be appealed but it does represent a major precedent for holding polluters accountable for their actions.

That same day, shareholders of ExxonMobil replaced at least two of the company’s board members with candidates dedicated to decarbonizing the company. Having two board seats filled by climate supporters is not likely to radically transform the company, but it is a powerful rebuke of Exxon’s iconic business model of “drill, baby, drill”.

Finally, Chevron’s shareholder meeting on May 26th saw 61% of shareholders voting for the company to reduce its so-called Scope 3 emissions, meaning the pollution from all the fossil fuels it sells. In addition, 48% of shareholders voted to demand a report on Chevron’s dark money lobbying. That initiative did not carry, but nevertheless, nearly half of the company’s shareholders expressed concern about how Chevron is corrupting the political process in order to achieve its ends.

These events are examples of mainstream activism where the pressure on fossil fuel companies is not just coming from the usual environmental activists but rather from shareholders, who after all actually own the companies. The fossil fuel industry still wields enormous power, but it appears increasingly possible to challenge it and even to win.

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A landmark day in the fight against fossil fuels

Photo, posted August 15, 2014, courtesy of Mike Mozart via Flickr.

Earth Wise is a production of WAMC Northeast Public Radio.