Winnipeg Free Press - PRINT EDITION
ExxonMobil turns oil into global empire
ANYONE who cares about how we are governed or the future of our children should read American journalist Steve Coll's latest book.
Coll, who won the 2005 Pulitzer Prize for his book on Afghanistan, Ghost Wars, has written a detailed and gripping account of the ExxonMobil corporation from 1998 to the present.
In 1998, Exxon bought Mobil in order to gain ownership of its extensive worldwide oil reserves.
The new corporation became the world's largest non-governmental producer of oil and natural gas and 45th out of the 100 largest economic entities in the world (including national governments).
Although headquartered in the U.S., ExxonMobil does not see itself as an American company. It does not pretend to have patriotic or social obligations. It boasts that its only purpose is to make profit for its shareholders.
It is a private global empire that co-operates or not with the U.S. government according to what it sees as its best interests. Coll quotes President George W. Bush saying, "Nobody tells those guys what to do."
However, because the U.S. absolutely depends on oil and its government owns no oil companies, it is inevitable that it would from time to time find itself at ExxonMobil's beck and call.
Coll describes how, whenever ExxonMobil met obstacles in its negotiations with other countries, it would call on the American government to help to clear away the obstacles and then sideline the government and resume the negotiations by itself.
Coll's chapters on ExxonMobil's dealings with brutal kleptocratic rulers in Russia and Africa are worthy of John le Carré.
For instance, in 2002, Lee Raymond, then chairman of ExxonMobil, tried to buy a controlling interest in the Russian oil company Yukos from its owner, Mikhail Khodorkovsky. Vladimir Putin intervened because he didn't want to have to get ExxonMobil's permission to tell Yukos what to do.
An arrogant Raymond responded, "That's not so awful. That's true in a lot of places in the world."
This was one of the rare times when ExxonMobil's culture of hard-line negotiating met its match. Putin had Khodorkovsky arrested and jailed. The negotiations were over.
Canadian readers will be particularly interested in Coll's references to the American movement to boycott oil from the tar sands. ExxonMobil's theory of oil economics is that oil boycotts do not matter.
The corporation believes that no matter where it originates, all oil eventually finds its way onto the world market. If ExxonMobil (or its affiliate, Imperial Oil) cannot sell Canadian oil to America, it will easily find an alternative buyer in Asia.
It would be concerned if the Canadian government limited tar sands production but is sure there is virtually no chance of that.
As scientific evidence about fossil fuels as a cause of global warming began to grow, ExxonMobil adopted a strategy of denial. The corporation funded an aggressive public campaign designed to put the evidence in doubt.
Ironically, at the same time, its own scientists were exploring how ocean conditions affected by climate change might give the corporation a head start in discovering new oil finds.
Despite its controversial subject, Coll's book is not a polemic. It is a factual account of a powerful corporation that is not embarrassed to support its profit-making duties by deploying its superior resources to destroy opposition, influence legislators and spread public disinformation.
As a result, when ExxonMobil's interests and the public interest clash, the corporation usually prevails.
Perhaps our anger should be directed less at a corporation that does what it says and more at the meretricious politicians and regulators who betray the public interest on its behalf.
Winnipegger John K. Collins comes from a long line of anti-imperialists.
Republished from the Winnipeg Free Press print edition June 9, 2012 J7