Photo by Felix Clay / Greenpeace
It’s not often that you meet a life size polar bear on your way into work but that is what greeted staff at Cairn Energy in Edinburgh this morning. The Scottish oil and explorer is being targeted by Greenpeace as part of an ongoing campaign to stop the company from exploring in the waters of the Arctic off Greenland.
Several activists – along with the bear – blockaded the entrance to Cairn’s office. Earlier in the day, Geenpeace along with other environment organisations WWF and Friends of the Earth wrote to Sir Bill Gammell, Cairn’s CEO, demanding he publishes the company’s emergency response plan to any incident or accident in the Arctic. Activists from the group scaled one of the rigs Cairn was using last year in Greenland and managed to stop work there for a bit.
Another day, another complaint about the carbon floor price. This controversial policy has united an unlikely alliance of green campaigners and heavy industry in opposition.
Greens don’t like it because it benefits the nuclear industry, while manufacturers are disgruntled about having to pay more for electricity.
But Greenpeace and WWF had a legitimate claim that government policy was incoherent – on the one hand promising no subsidies to nuclear power but at the same time implementing a policy that could indeed earn such generators billions of pounds. The EEF, which represents manufacturers, on the other hand, is criticising the energy department for doing exactly what it intends to do: push up the cost of energy.
As reported in the FT on Monday, green campaigners in the UK have stepped up their attack on the carbon floor price, calling it a “windfall” for the nuclear industry.
They first made this warning in the immediate aftermath of the electricity market reform announcement, but now Greenpeace and WWF have put some numbers to their arguments.
They say the move could benefit the nuclear industry by up to £3.4bn, which would effectively be a subsidy, and so breach the coalition agreement.
The chancellor has stopped speaking and the figures are in. But did the experts to whom this blog spoke earlier get what they wanted? Here are their responses.
It’s the big day. Finally we see what the UK government’s spending plans are going to look like over the next four years. But what will George Osborne’s announcement mean for the energy industry? We asked a group of experts, industry insiders and campaigners to give us their view on the main things they want to hear from the chancellor. Here’s what they said:
An analyst commented to me this week:
Will the oil industry change in the wake of the BP oil spill? I doubt it. There may be some changes on the fringes but most people expect to see business continue as normal.
Today we have the first signs of a return to “business as normal” with the news that the UK energy department has agreed to let Chevron begin deepwater drilling off the Shetland coast. This is the first new project to be agreed since the BP spill.
Chris Huhne, the UK’s energy secretary, said yesterday he was worried about the “financing of big renewable projects, particularly big wind farms”, which could hinder the government’s pledge to make sure 15 per cent of the country’s energy comes from renewable sources by 2020.
He has reason to be worried. At the height of the financial crisis, some of the UK’s biggest wind power projects were hit by a wave of withdrawals from financiers. In May 2008, Shell backed out of the London Array, while later that year, BP said it would focus instead on US wind power. Then, early last year, Iberdrola said it would cut its investment in the UK by 40 per cent.
But Huhne may be being a little disingenuous here. Industry sources tell us the major disincentive from building wind power capacity at the moment is not a lack of private investment, but worries about the government’s commitment to the necessary infrastructure.
It just wouldn’t be a proper oil-related disaster if Greenpeace were not involved at every stage of the game.
Responding to BP’s report on the oil spill, Jim Footner, head of its energy campaign, said:
“This report is a sorry catalogue of the gaffes and failures behind the Deepwater Horizon disaster. And it’s highly likely that a truly independent report would be even more damning for BP.
“Worryingly, they’re just weeks away from drilling at similar depths in UK waters. The Government must step in right now and stop this by introducing a moratorium on deep water drilling.
Cairn Energy has been forced to suspend its operations on one of its rigs in the Arctic after four Greenpeace campaigners scaled the rig early on Tuesday morning in a bid to stall oil drilling in the region.
The UK oil and gas explorer has plans to drill four wells in the waters of Baffin Bay Basin, off Greenland’s west coast, but the recent BP oil spill in the Gulf of Mexico has raised fears over the risks of offshore drilling.
Cairn announced last week that its first well had shown evidence of hydrocarbons.
A Greenpeace ship, the Esperanza, has been in a stand-off with the Danish navy off Greenland for the past few days. Many environmentalists argue that Arctic drilling is fraught with risks, from drifting icebergs to hostile weather, but as oil companies scramble to find new reserves around the world to meet demand its reserves have caught they eye of the industry.
Nothing like the words “Arctic” and “oil drilling” to get the environmental campaigners excited.
Add banks to the mix, and you have the perfect mix for a modern day witch-hunt.
The latest targets are Cairn Energy and the Royal Bank of Scotland. In a joint press release, PLATFORM, Friends of the Earth Scotland and the World Development Movement on Tuesday said they “condemn [the] link between public money and Cairn’s Arctic drilling – RBS provided loan to oil company one month before it acquired rig for arctic drilling.”
The amount in question is a reported $100m lent by RBS – majority owned by UK taxpayers – last December.
The (first) problem with their point, however, is that RBS is a corporate broker to Cairn -so the $100m is likely to be just a fraction of the total it lent to the oil company last year. There seems to be no evidence to show that this particular $100m and the Arctic drilling are linked.
Secondly, the environmentalists’ outrage at taxpayer money financing oil drilling bizarrely stops with the Arctic. Drilling in Rajasthan – where Cairn in fact gets most of its oil – doesn’t seem to be a problem. Yet why is it less acceptable to drill near barely-populated frozen landmass than in the middle of India, where actual people may be affected by the drilling operations?
Maybe because polar bears are much cuter than people?