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By Root 1891 0

While most employees of the Kutubu project are resident citizens of Papua New Guinea, others are Americans or Australians who are flown out to Papua New Guinea to work there for five weeks, then are flown back home to spend five weeks with their family, and those airplane fares are also expensive. All those employees see for themselves the state of the environment in the oil fields, and they see the company’s commitment to clean environmental policies. Many Chevron employees told me that that issue of employee morale and environmental views was both a benefit of their company’s visibly clean environmental policies and also a driving force behind the adoption of those policies in the first place.

In particular, environmental concern has been one criterion used to select company executives, and Chevron’s two most recent CEOs, first Ken Derr and then David O’Reilly, have both been personally concerned about environmental issues. Chevron employees in several countries told me independently that every month they and every other Chevron employee around the world receive from the CEO an e-mail about the state of affairs in the company. The e-mails often talk about environment and safety issues and speak of them as being number-one priorities, and as making good economic sense for the company. Thus, employees see that environmental matters are taken seriously, and are not just window-dressing that is for public display but that is ignored within the company itself. This observation corresponds to a conclusion that Thomas Peters and Robert Waterman Jr. drew in their best-selling book on business management In Search of Excellence: Lessons from America’s Best-Run Companies. The authors found that if managers want their employees to behave in a certain way, the most effective motivation is for the employees to see the managers themselves behaving in that way.

Finally, new technology has made it easier for oil companies to operate more cleanly now than in the past. For instance, several horizontal or diagonal wells can now be drilled from a single surface location, whereas formerly each well had to be drilled vertically from a separate surface location, each causing environmental impacts. The rock debris (the so-called cuttings) that is ground up as a well is drilled can now be pumped into an isolated underground formation containing no producible oil, instead of (as before) dumping the rocks into a pit or into the ocean. Natural gas obtained as a by-product of oil extraction is now either reinjected into an underground reservoir (the procedure used in the Kutubu Project), or (in some other oil fields) shipped out by pipeline or else liquefied for storage and transport by ship and then sold, instead of burning it off (“flaring” it). In many oil fields, as in much of the Kutubu fields, it is now routine to operate exploration drill sites by means of helicopters rather than by putting in roads; helicopter use is of course expensive, but road construction and impacts are often even more expensive.

These, then, are reasons why Chevron and the handful of other big international oil companies have been taking environmental issues seriously. What it all adds up to is that clean environmental practices help them make money and gain long-term access to new oil and gas fields. But I should reiterate that I am not thereby claiming that the oil industry is now uniformly clean, responsible, and admirable in its behavior. Among the most widely publicized persisting and serious problems are recent large spills at sea from wrecks of poorly maintained and poorly operated single-hulled tankers (such as the sinking of the 26-year-old tanker Prestige off Spain in 2002), belonging to shipowners other than the large oil companies, which have mostly switched to double-hulled tankers. Other major problems include legacies of old, environmentally dirty facilities, constructed before the more recent availability of cleaner technologies and difficult or expensive to retrofit (e.g., in Nigeria and Ecuador); and operations under the auspices of corrupt and abusive