The Big Question: Is it possible to drill for oil without devastating the environment?

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Why is this question being asked afresh?

BP, formerly known as British Petroleum and now the second largest oil company in the world, is shutting down production from its giant oilfield in Alaska after finding another spill from a corroded pipeline.

It is a drastic response to the discovery that several chunks of the pipeline are corroded and close to breaking open. The temporary closure of wells producing 400,000 barrels of oil a day, 8 per cent of total production for the whole of the US, has sent oil prices soaring.

BP was shouting at the top of its voice yesterday about how it is prioritising the environment in this sensitive area inside the Arctic Circle. But environmentalists say the evidence of corrosion simply proves what they have been saying all along: that BP's Alaskan operations have an appalling environmental record that has only been exposed because of brave whistle-blowers inside the company.

The tests on the pipeline, which discovered this latest spill at the weekend, were instigated because of a much bigger disaster earlier this year. Oil had been leaking for five days from a corroded BP pipeline between facilities at Prudhoe Bay when a worker driving a deserted stretch of road noticed a strong petroleum smell and stopped to investigate. It was the worst oil spill in Alaska since the Exxon Valdez container ship was holed in 1989, and BP is now under criminal investigation for its safety record in the region.

Why is Alaska so environmentally sensitive?

Alaska's Arctic region is a vast wilderness, home to hundreds of animal species including bears, wolves, caribou, musk oxen, and millions of migratory birds. Conservationists argue that the tundra is fragile and will be irreparably harmed by development of the infrastructure that is required for drilling. The wildlife of the area is already being disturbed and displaced, they say, and an awe-inspiring wilderness will eventually be lost forever.

Green groups have mounted a strong campaign against plans by BP and other major oil companies to extend their drilling into the explicitly protected Arctic National Wildlife Reserve (ANWR), created to maintain a unique eco-system that span Arctic and sub- Arctic Alaska.

And if the impact of development on these areas is one thing, the potential effects of oil spills is quite another. There are about 500 spills reported annually across the North Slope, the north-western tip of the state where wells and pipelines are currently located.

Alaskans are still fighting Exxon for a settlement over the Exxon Valdez disaster which, they said, wiped out their livelihoods from fishing.

Is the environment lobby winning the political arguments in the US?

It is difficult to be hopeful that the ban on oil production in ANWR will be maintained, particularly if oil prices stay high and American consumers continue to feel the pinch of soaring petrol prices. The likelihood that there are billions of barrels of oil under the ground within the sanctuary, and even more gas, will tempt politicians looking for ways to bring down oil prices.

President George Bush, who supports drilling in ANWR, has also linked the issue to "energy security", that is, the need for the US to reduce its dependence on oil from the volatile Middle East. A new Bill to remove the protections from ANWR was introduced into Congress last month. To mute criticism, it would also introduce new financial incentives for oil companies to invest in renewable fuels.

What about in the rest of the world?

The concern is that exploration work is now moving away from the developed world, where governments have more or less strict environmental regulations in place, to areas where such protections are much lower down the political agenda. Friends of the Earth is currently campaigning against Shell's major project at Sakhalin Island, off the east coast of Russia, which goes near breeding grounds of endangered western grey whales. And green groups say unchecked development in rural Africa could be an environmental disaster.

Are oil companies doing enough to protect the environment?

One thing both the oil industry and the green movement would agree on is that it is impossible to drill for oil without having an impact on the environment. The question is whether the industry is doing as much as it can to minimise that impact; the larger debate is whether the damage is a price worth paying.

Undeniably, companies are telling us more about their activities. This is an era of environmental impact assessments and consultation with local communities. Most companies also have policies on the use of natural resources and clean-up operations. Advances in technology have also been able to limit damage, with multiple wells drilled from a single rig. The remote control device used by BP in the Alaskan pipelines spotted corrosion earlier than would have been possible before. Even Exxon Mobil, the bogeyman of the industry because it denies the link between carbon emissions and global warming, is committed to new technologies that reduce the greenhouse emissions of its refineries and other operations.

Environmentalists, though, insist that as long as the pursuit of profit is put above protection of the environment, the oil majors will make damaging choices.

Shouldn't we have switched to renewable fuels by now, anyway?

The answer to whether we can drill for oil without harming the environment is already no, in the narrow sense that no system will totally prevent spills or fail to alter a natural habitat for wildlife. But it is most certainly no if climate change is included in the equation. BP is still investing barely 5 per cent of its capital budget on renewable fuels, and most oil companies are putting in even less. It is clearly not enough to speed up the development of new fuel sources such as wind and solar power, or even biofuels made from sugar and other natural ingredients. Progress is being made outside of the big companies, but it remains painfully slow.

Is the oil industry doing enough to protect the environment?


* Environmental protection has moved up the agenda inside every major oil company

* New technologies mean that drilling can be done with minimal impact on the environment

* Regulations in the West have got ever tighter and companies cannot afford to be fined or to lose their reputations


* Small oil spills are widespread, and larger environmental disasters are inevitable

* Money-hungry oil companies will develop regions that have so far remained unspoilt

* Burning fossil fuels will destroy the environment through global warming