ExxonMobil, the new criminal company to carry out fracking in Colombia
Gearóid Ó Loingsigh
22 March 2020
According to reports in the Colombian media, the North American company ExxonMobil has put forward a proposal to carry out the second pilot programme for fracking in the Middle Magdalena Basin. (1) It one of the largest oil companies on the planet with operations in 45 countries. The Colombian government seemed to be bent on handing over the country not just to fracking but the worst criminals from that shadowy world.
The president of the National Hydrocarbon Agency (ANH) praised the company highlighting that "ExxonMobil... has great experience in these types of projects”, (2) but didn't mention its environmental record, but rather said that "the experience of companies such as ExxonMobil and Ecopetrol will be deployed in projects with the highest technical standards, an open and participative dialogue with the communities and the guaranteed protection of the environment."(3)
However, ExxonMobil's experience indicates that it is not just one of the worst companies regarding pollution but neither is its experience with fracking very positive. The company became very well known internationally due to the Exxon Valdez environmental disaster, a ship that spilled 41,000m3 of crude oil affecting 2,100 Km of the coast of Alaska. But its disastrous environmental history does not end there, but rather continues to date.
First, it should be pointed out that Exxon opposed the attempts to make them pay for the harm caused in Alaska. When it happened, it did not rush out to acknowledge its role and pay for the damage caused but rather fought till the end in order not to pay or reduce payment. Exxon paid a fine of $150 million dollars, but the courts reduced it to $25 million, accepting the clean-up carried out by the company as payment of $125 million. The company agreed to pay $100 million in criminal restitution and another $900 million as part of a civil settlement (this payment was spread out over 10 years). (4) In all, $ 1.125, if we include its expenditure in cleaning up. It is not a lot of money. In 1989, the year of the spillage, it paid out a dividend of $2.30 per share, and in 1991, $2.68, rising to $2.83 in 1992 and in the following years continued to rise i.e. it did not affect its profits.(5) The company itself acknowledges that over 38 years its dividends have risen at a yearly rate of 6.1% and according to its 2020 annual report it had a net income of $14.34 billion in 2019 and paid out $14.652 billion in dividends for the same year.(6) Despite what it had to pay it was not a measure that affected the company much.
Exxon also fought a case in the state of New Jersey. The state sued for $8.9 billion due to the loss of 1,500 acres of wetlands. However, in 2015 it reached an agreement with the state of New Jersey and paid out just $225 million, without acknowledging or accepting its responsibility in the events in the suit. (7) It also faced a suit for dumping 215 m3 of water used in fracking into a river. In a perverse statement the company said that pursuing them for such a small quantity discouraged good environmental practices. The company ended up paying a fine of $100,000 and spent $20 million in updating its machinery. (8)
The company has faced other suits, including one from its own CEO, Rex Tillerson. ExxonMobil does not like being litigated but does not hesitate to sue others. It presented a suit against Venezuela before the International Center for Settlement of Investment Disputes (ICSID) and was awarded $1.6 billion, less than the $14.7 billion sought but significant nonetheless. The cause of the suit was the nationalisation of the company's assets by Hugo Chávez. The suits against it have not been few in number, following another suit it paid the city of New York $104.7 million for water pollution. Whilst the other companies involved in the events paid out, ExxonMobil, fought the matter out in the courts. In 2011 it had to pay $500 million for water pollution in the state of Maryland. Furthermore, ExxonMobil covered up the issue. In another case in 2013 one of the pipelines broke and 757 m3 flowed through the streets of Mayflower.(9)
But the strangest suit presented is one from its own ExxonMobil's CEO, Rex Tillerson against a fracking operation by his own company near his house. (10) If Tillerson doesn't want fracking near his house, what right does he have to ask us to accept it? If he doesn't trust the process or doesn't like it, why should we accept it? But it is clear that he doesn't trust it as he knows that ExxonMobil lies and covers up the truth. The company carried out its own investigations in the 1970s and 1980s and found that carbon was heating up the planet. It not only covered up its own research but rather financed campaigns that denied that climate change was real and even went as far as to state the planet was cooling down and now they say it doesn't matter as we will be saved from the impacts of climate change by modern technologies. (11)
Like many other oil companies, ExxonMobil suffered a serious crisis in 2020 due to the Covid-19 pandemic that provoked a sharp fall in demand. In the first nine months of 2020 the company reported losses of $2.4 billion. Despite this the company has been slow in adopting new strategies. Instead of investing in new technologies, the company has doubled down on its stake in gas and oil.(12) So ExxonMobil is one of the companies exploring new fields in Suriname in an attempt to leave behind the crisis caused by the pandemic. Its arrival in Colombia is part of that strategy. But we should always remember that it is one of the biggest environmental criminals in history and not even its own CEO trusts it.
(1) El Tiempo (17/03/2021) ExxonMobil se apunta para hacer el segundo piloto de 'fracking' https://www.eltiempo.com/economia/sectores/fracking-estadounidense-exxonmobil-se-postula-para-hacer-segundo-piloto-574237
(4) See https://evostc.state.ak.us/oil-spill-facts/settlement/
(6) ExxonMobil 2020 Annual Report https://corporate.exxonmobil.com/-/media/Global/Files/investor-relations/annual-meeting-materials/annual-report-summaries/2020-Annual-Report.pdf
(7) New York Times (07/04/2015) New Criticism After New Jersey Posts Text of Exxon Settlement. Benjamin Weiser https://www.nytimes.com/2015/04/08/nyregion/new-criticism-after-new-jersey-posts-text-of-exxon-settlement.html
(8) Grist (13/09/2013) ExxonMobil company charged with fracking-related crimes. John Upton. https://grist.org/climate-energy/exxonmobil-company-charged-with-fracking-related-crimes/
(9) Money Inc. (2016) 10 Exxon Mobil Lawsuits You Should Know About. Gareth Parker. https://moneyinc.com/exxon-mobil-lawsuits-you-should-know-about/
(11) Bill McKibben (18/02/2016) Exxon's Never-Ending Big Dig. https://tomdispatch.com/bill-mckibben-it-s-not-just-what-exxon-did-it-s-what-it-s-doing/
(12) New York Times
(10/12/2020) 'Is Exxon a Survivor?' The Oil Giant Is at a Crossroads.
Clifford Krauss. https://www.nytimes.com/2020/12/10/business/energy-environment/exxon-mobil-pandemic-energy-transition.html?searchResultPosition=7