At the beginning of 2008 Shell’s CEO at that time, Jeroen van de Veer, announced to his staff and the world that the era of “easy-to-find” oil was coming to an end. The giant oil fields, that people hoped would last forever, are starting to run dry and the big oil companies no longer have access to oil in countries whose governments don’t want them. And where they are let in, local conflict often disrupts production.

Faced with these increasing restraints on access to the easy oil, the big oil companies have begun chasing the difficult oil, going to ever more dangerous frontiers, and trying to access the oil at the ends of the earth.

‘Frontier’ oil is risky, expensive and destructive. It requires more money and energy per barrel to produce, increasing the climate impacts of oil. And as we’ve seen recently in the Gulf of Mexico, when accessing frontier oil goes wrong it’s extremely difficult to stop, spilling oil into the environment for months, and leaving untold effects on our ecosystems.

Despite claims by the industry to the contrary, frontier oil is unnecessary, won’t make oil cheaper, and won’t help us be more energy secure. If frontier oil resources are exploited, and the oil burnt, we will be on track for a six degree rise in global average temperatures. That would be catastrophic for our climate - for us, for food crops and ecosystems around the world. It might make big oil more money in the short-term - but in the long-term it’s risking our environment, our economies and our future.

Deepwater

The Gulf of Mexico is the most prolific area of deepwater activity, but it is certainly not the only one. Oil is being drilled at vast depths off the coasts of countries all around the world.

As the oil resources we’ve relied on for the last 100 years start to run out in shallower waters, oil companies are going further from shore and drilling deeper than they have ever gone before. The drilling for oil and gas in waters deeper than 650 ft (200 metres) is known as deepwater. But some drilling is happening in waters deeper than 5,000 feet.

A disaster waiting to happen?

The Deepwater Horizon well, which blew out in April 2010, was drilled in 4,993ft (1,522m) of water. The difficulty of completely stopping a blown out well at this depth has become clear with the multiple failed attempts made at the Macondo well. The ultimate solution, the drilling of relief wells, takes months. The deeper the well, the longer it takes, the more oil is spilled. The low temperatures and high pressures at these depths often make stopping the leak very difficult. There were many experts trying to warn industry and government bodies about the dangers of drilling at these depths in recent years, but the warnings appear to have been dismissed.

It is still too early to quantify the full extent of the environmental, social and economic damage caused by the Deepwater Horizon spill but already we know there has been a huge impact on local wildlife, coastal communities and local industry.

Some marine scientists have expressed concern that the huge plume of oil and gas that spread from the leak to the surface may create giant oxygen-deprived dead zones as oil consuming microbes proliferated around the plume using up all the available oxygen. Although US officials recently declared that oil from the spill is mostly “gone”, scientists have found evidence of a large underwater plume of oil more than half a mile underwater and at least 22 miles long.

The impact on fisheries, wildlife, both coastal and marine, and tourism and recreation industries in the region will likely be felt for decades to come. There are concerns that the presence of so much oil in the marine ecosystem is killing certain species while encouraging others to proliferate, with serious implications for the entire food web.

The Gulf of Mexico is the most prolific area of deepwater activity but it is certainly not the only one. Oil is being drilled at vast depths off the coasts of Canada, Norway, Nigeria, Angola, Brazil, Malaysia (Sarawak), China, Vietnam and Australia.

BP plans to begin a deep drilling operation off the Shetland Isles, in UK coastal waters, to depths of 4,265ft. The operation could begin as early as October, subject to government approval. Bp also has plans to begin drilling off the coast of Libya in the Mediterranean sea this autumn. The site is more than 1700 meters below sea level, that 200 meters deeper the the Deepwater Horizon site.

High Risk, High Cost

The Deepwater Horizon drilling rig that BP contracted from Transocean to drill the Macondo well in the Gulf of Mexico was costing BP $500,000 a day to lease. Statements from workers on the rig suggest that there were safety concerns weeks before the fatal blowout. The spiraling costs of drilling at the Macondo well perhaps led BP managers to decide not to spend the extra money to insert more effective technology which could have created more barriers to the fatal flow of gas which caused the explosion.

The expense of tighter safety regimes and procedures for deepwater production is something BP and the industry as a whole has lobbied successfully against for years. So while the industry pushes harder into more extreme, difficult and costly oil areas, both the need for more rigorous protections and the incentive for the oil companies to avoid them become greater.

If demand for oil continues to grow while the costs of exploiting it rise we will face increasing risks with escalating consequences. As time goes on and new technologies are developed to explore for oil in ever more treacherous environments, it seems inevitable that companies will not be prepared for disaster scenarios that are deemed “highly unlikely”, such as a major blowout in deepwater. The next disaster could occur in an environment that could be even more difficult to address than the Deepwater Horizon. It could occur in Arctic waters.

Tar Sands

Underneath boreal forests that stretch across northern Alberta in Canada there are bituminous deposits that contain sand, clay, water and heavy crude oil – also known as tar sands. The oil isn’t free flowing, it’s in a solid or semi-solid state so it requires specialised methods of extraction. But extracting the oil requires massive environmental disruption. Forests are clear-cut, the landscape is strip-mined, water-systems and wildlife are poisoned, and indigenous peoples are displaced.

There are basically two ways that the oil gets extracted. Either the soil mixture is mined - scooped up by gigantic machines and essentially cooked in a series of giant ovens to separate the crude oil from the sand. Or steam gets injected directly into the ground at huge pressure and temperature in order to liquefy the oil, what’s known as ‘in-situ’. Either way it takes a whole lot of energy to do it: producing tar sands oil means up to three times the carbon emissions of normal oil extraction, because it requires so much energy to separate the crude from the soil.

There are many other reasons why tar sands oil extraction isn’t good for us or our planet:

• The boreal forests, peat lands and wetlands of Northern Canada play their role in absorbing carbon from the atmosphere. And when they are destroyed they release the additional carbon into the atmosphere that they store within them.
• Alberta is becoming Canada’s industrial air pollution hotspot as a result of tar sands extraction and processing. The processes produce nitrogen oxides (NOx) and sulphur dioxide (SO2) which cause breathing problems, smog and acid rain. They also produce Benzene, a volatile organic compound also known as a carcinogen which increases the risk of cancer.
• Indigenous first nation peoples in Alberta are losing their ability to hunt and fish, water, habitats, fish and game are being contaminated, and communities are reporting unusually high levels of cancer.
• Tar sands extraction and processing takes a huge toll on water resources. Vast amounts of the Athabasca river are being diverted and the mining process has already created huge lakes of toxic slurry covering 130 km2 (the size of Manchester). These are suspected to be leaking at least 11 million litres a day into the Athabasca watershed, and could triple in coming years. The censorship of an 18-month study into the impacts of tar sands production on water resources is a clear signal that both industry and government have something to fear on this issue.
• The total area that could be impacted if all extraction projects go ahead is 13.8 million hectares, which is greater than the entire land area of England.

You can read more about the Tar Sands here.

The Arctic

The Arctic is a stunning pristine environment and also a barometer of the health of the planet. The Arctic is home to an incredibly diverse range of animals and plants, with new species, being discovered every year. The evidence of recent years shows that climate change is already affecting the Arctic, as average temperatures rise and the sea melt season is getting shorter. Analysis of data from the last three decades shows that the summer Arctic sea ice melt season now lasts nearly a month longer than it did in the 1980s. Because of the receding polar ice, many industries, including industrial fishing trawlers, are able to access areas previously unexploited. And oil companies have their eye on it too.

Research suggests that the Arctic contains up to 90 billion barrels of oil. According to the US Geological Survey the Arctic holds 13% of the world’s untapped oil reserves, mostly offshore. The Arctic has captured the attention of all the major world powers and tensions are being fuelled by the race for Arctic oil. Russia is focused on the Arctic as a significant potential source of oil and gas. Similarly NATO members such as the US, Canada, Norway, Iceland, Denmark and Greenland also see the region as a strategic priority.

Currently the production of oil in the Arctic is relatively small and has been limited to the Norwegian sea and the Beaufort sea, north of Alaska and Canada. In the aftermath of the Deepwater oil spill, US licensing rounds in the seas north of Alaska have been put on hold. Still, a number of exploratory offshore wells have already been drilled in the area and the Canadian parts of the Beaufort sea have a number of active exploration licenses. Canada is still soliciting bids for more.

Despite calls for a moratorium, the Norwegian government is opening up new blocks for exploration and drilling in the Barents and Norwegian seas of the Arctic. Russia is also actively developing offshore oil fields in its parts of the Barents sea.

But it is Greenland that is currently causing the most excitement over Arctic oil and gas prospects. Many geologists believe it possesses the greatest potential for oil reserves. The Greenland government is looking to oil, minerals and fisheries development as a way to build up its self-reliance from Denmark.

BP and Shell were involved in early seismic exploration in the 1990s and as a result maintain preferential bidding rights in the area. In 2012 and 2013 they will try to turn these bidding rights into licenses when Greenland opens up areas off Greenland’s northeastern shore.

Edinburgh-based Cairn Energy is the key UK company active in the region. Cairn has started drilling two exploration wells in the West Disko region, and in August 2010 it received the go-ahead from the Greenland government for a further two sites. It is also planning to drill a further 3-4 wells in the Southern basin in 2011. The company holds eight exploration licenses off western and southwestern Greenland covering half the size of England – right in the middle of the Davis Straits – better known as ‘iceberg alley’.

If a spill occurred in this harsh and unpredictable Arctic environment the consequences would likely be disastrous. Little to no capacity exists to handle accidents in ice-filled seas. The techniques deployed in the Gulf which were fraught with failure would be useless in the Arctic. Cold weather, thick ice cover and the slow development of plants and animals means that multiple generations of organisms would be exposed to contamination since the toxic oil would linger in the environment. Even without a major spill, the regular ongoing industry practices of exploration, seismic testing, and extraction of offshore oil reserves has the potential to disrupt seasonal migrations of whales, spawning run of salmon, and crucial reproductive periods of migrating birds.

The impact of the 1989 Exxon Valdez spill into the Gulf of Alaska continues to plague marine and coastal environments. Pockets of toxic oil remain in sediment under gravel beaches. Sea otters, whose population size was cut in half, have yet to rebound, and marine mammal species, with toxins incorporated into their blubber, are nearing extinction. Populations of killer whales were reduced by as much as 40%. Twenty years later the same killer whale population has yet to recover and could go extinct in a few decades.

Arctic oil spills could set off irreversible chain-reactions of contamination because inland species, such as Polar bears and foxes, rely heavily on coastal resources. As a result, the ‘footprint’ of oil exposure would extend far inland because coastal species would accumulate toxins in their bodies as they consume oil-exposed marine prey.

The Arctic is one of our last, untouched natural environments. Why would we want to put it at risk?