Exxonneration?

Help is on the way. It was wonderful to read that ExxonMobil is being sued by the New York Attorney General’s office in the United States for the lies to investors about the pollution caused by producing oil from Alberta tar sands. After three years of investigating, it is claimed that ExxonMobil (through its Canadian subsidiary Imperial Oil) has been understating its carbon emissions taxation exposure to the tune of US$30 billion.

With carbon taxes expected to reach $50 per ton in at least 10 U.S. states as well as across Canada by 2023, this $30 billion oversight is going to cost ExxonMobil much more than $30 billion in catching up and in possible court penalties.

The charge is that Imperial Oil and its parent company ExxonMobil have been lying to investors and the public for many years. Those of us who knew about some of their lies were not surprised. To a company created by American John D. Rockefeller, the lies were just as to be expected and the US$30 billion and fines will be paid out of petty cash.

The lies about the tar sands go back to the beginnings of Alberta as a province of Canada. It was the lie told to every Canadian school child that the Athabasca and Cold Lake tar sands were the largest reserve of ‘oil’ in the world. The bitumen-like heavy oil of Venezuela is probably the larger reserve but political problems there are currently preventing that country from increasing production.

But it was more insidious to rename the tar sands as ‘oil sands’ and to pretend that Canadian bitumen was just another form of heavy oil. The problem is that bitumen has to first be converted to synthetic crude oil before it can be further refined into oil products. That initial refinery step produces three times the carbon pollution of normal crude oil refining. It produces huge quantities of what is called bitumen slag.

While none of the ExxonMobil lies to investors has yet been discussed in court, it will be very interesting to see what ExxonMobil’s lawyers say in the company’s defence.

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Copyright 2018 © Peter Lowry

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