by Gary Cook
Baikal Watch
While the diplomats and soldiers sort out the situation in Kosovo, another battle rages on the other side of Eurasia. It is here, on the seemingly insignificant island of Sakhalin, that a handful of environmentalists vie with some of the world's largest oil and gas corporations. At stake is more than just modest oil deposits hidden below the Pacific shelf. The fate of western investment - the quest to extract the resources of Russia - may lie in the balance.
Repercussions of the NATO/Serbia confrontation are reaching all the way into eastern Russia. A certain xenophobia has infected the populace here, much of it directed against America and its western allies. Representatives of western oil companies have already begun feeling some of this mistrust from the local people. Conventional wisdom has it that this suspicion comes simply from a the historic sense of kinship between Slavs and Serbs. But are there other causes?
To answer this question, we can look back at the recent history of Pacific Russia. In the early 1990s, as exploratory teams from companies such as Exxon, Shell, and Mitsubishi began to arrive on Sakhalin Island, scientists and community leaders began to raise questions about oil development. They were already aware of the Exxon Valdez disaster in neighboring Alaska, and - thanks to their connections with international activist groups such as Earth Island Institute - they had uncovered critical information about similar mishaps around the world.
As efforts at cooperation blossomed between local citizens and international eco-groups, mistrust of oil companies grew. Local people were quick to fret about events that seemed to contradict the companies' claims. For instance, all the oil corporations had formed limited liability companies, and then registered them in obscure countries such as Bermuda and the Bahamas. Did this show their concern that there might be damage done to the environment and to the local economies which they wanted to avoid paying for?
There was other evidence as well. The oil companies seemed quite unwilling to dedicate any of their double-hulled tankers to transporting the oil at Sakhalin. The first platform to be put in place there was over 20 years old, having been retired from use in Canada. These and similar cost-cutting efforts caused much concern among the locals. Many now believe that the companies are conducting an experiment in the region; an odd place for an experiment, since it is one of the most ice-laden, seismically-active areas in Russia, if not the world.
The oil companies have countered these arguments by emphasizing the potential economic benefits to the region from oil. The locals have their doubts. They cite the companies' old promise to supply enough gas to supply heat and power to the entire island by century's end. Yet no project to develop the large gas reserves off Russia's east coast has even begun. Jobs were also promised, but most jobs have gone to "imported" western workers, leaving only menial opportunities for locals.
Finally, the people throughout eastern Russia are worried about the livelihoods of local fishers. The surrounding Sea of Okhotsk is one of the richest commercial fisheries in the world. It supplies Russia with nearly 40 percent of its marine food products. The companies have claimed that there should be little or no damage to these resources. Yet fishers and environmentalists from abroad have shown how the fisheries in Alaska, in southern California, in the North Sea, and elsewhere, have all been harmed by the oil industry over time.
Armed with this knowledge, the indigenous people of eastern Russia are poised to protest oil development on Sakhalin Island. They are being joined in their concerns by the people of Hokkaido Island in Japan, 40 miles south of Sakhalin. Citizens of both countries now wonder who will benefit from these oil developments. They ask why there's a moratorium on off-shore drilling in the fish-rich regions off North America's coasts, while there is no such intention to spare the ocean shelves of eastern Asia.
Are greens harming relations?
As Russia is tempted to retreat again from the West, couldn't western environmentalists fomenting against western companies influence Russians to return to the old days of anti-Americanism?
To environmentalists active in Russia, it appears that the opposite may be true. International groups are mostly promoting democratic principles. They work closely with local groups to enlighten and motivate the citizens of Russia. They also assist local governments, and the oil companies themselves, to enhance their understanding of the complexities of oil development in the region.
Environmentalists have given expert assessments and recommendations for improving companies' oil spill prevention and contingency plans in eastern Russia. They have helped local oceanographers to predict the scope and direction of possible oil spills.
They have even allied themselves with the Russian Federal Agency for Sea Inspection, which was to be dissolved by the "pro-oil" faction in the Russian government. Thanks to suits brought by public interest law firms in Moscow, this important agency is now back in operation, and monitoring the critical oil developments in the Russian Pacific.
But most important of all, the international environmental groups are trying to help the Russian public get involved. They want Citizen Ivan to be as prepared as possible as Russians decide the fate of their environment. In essence, they are helping secure the rights of local people. And one of the most important rights is a guarantee that the oil companies will either spend the money to protect the environment while providing economic benefits for local people, or cease all operations in the region.
A decade's oily learning curve
Though we find more environmental safeguards taken in high-profile places such as Prince William Sound, the oil industry is still dragging its feet. They are delaying many improvements, including the construction of a suitable number of double-hulled tankers. As for Russia and other foreign countries, these companies seem content to keep their social investments at a minimum. No doubt they will continue importing some of the oldest and cheapest technologies for extracting crude oil in a manner that maximizes their profits.
There is finally the rather dubious distinction of these oil companies acting as representatives of the West, especially in countries where they often make unfavorable impressions, such as in Russia, China, and the other opening economies of the world. Given their record in the Middle East, it is difficult to believe that the oil corporations won't burn bridges before they are even crossed. And it will be a sad testament if the legacy that is left on Sakhalin and eastern Russia is one of pollution and economic dependence. In these fragile times, such a development would only push East and West towards a return to the polarization of the Cold War.
Gary Cook is Director of Baikal Watch, a project of Earth Island Institute.
Oil in the Russian Pacific