Putin’s War: possibly a would-be emperor’s war, but most assuredly an OIL WAR!
Every news analysis I’ve seen of Russia’s criminally ruthless war against Ukraine has focused on Putin’s nationalistic dream of the resurrection of the old Soviet Union and his Czarist ambitions.
But what about the more convincing economic reasons for the war? Where are our major news outlets, including the progressive ones like MSNBC and CNN when it comes to the proven political wisdom, FOLLOW THE MONEY?
Here’s an eye-opening post I found on an old friend’s Facebook page (thank you, Betsy Collins, originally posted by Christopher Goodfellow,) “From Price Wars by Rupert Russell….The chapter on Ukraine is interesting….if anything this explains Donbas and getting the ring around from Donbas to Odessa to get Control of the Black Sea oil there.” Read on…
MORE: Christopher Goodfellow posted several later FB messages that are even more detailed and illuminating:
BENICIA – Mayor Steve Young says he’s displeased that Valero Benicia Refinery is poised once again to spend a large sum of money during the upcoming city council election.
The refinery dumped $200,000 into its Working Families for a Strong Benicia PAC last December, giving the PAC more than $232,000 ahead of the November 2022 election, according to campaign forms submitted to the Benicia City Clerk’s Office.
Benicia Mayor Steve Young
Typically, a Benicia council candidate can expect to receive more than $20,000 in contributions over the span of an election or about 10% of what Valero has available.
The move has revitalized conversation in town between environmentalists seeking more regulations, the company, and local unions that are concerned that city officials want to shut down the plant.
Valero couldn’t be immediately reached for comment.
Young — who said he issued his statement over the weekend only as a Benicia resident and not as mayor — admitted that what Valero was doing was legal but argued “it is wrong-and extremely harmful to our community.”
“There is only one purpose in making such a huge expenditure nine months before the election: to scare off any potential City Council candidate who would consider running without first getting Valero’s stamp of approval,” Young’s statement read. “What candidate is willing to go up against that kind of war chest?”
Young wrote that Valero should have a say in the election but “they should also play by the same rules that apply to everyone else under our campaign finance regulations.”
Young said the city’s campaign laws allow a candidate to spend no more than $35,000 on a campaign. He argued Valero should be held to the same rule.
“But Valero’s size and wealth gives them the belief that they can pick and choose who should be our elected representatives,” Young added.
Young said that to stop Valero every council candidate should reject support it receives from the company.
“In addition, voters should demand that any candidate take a public and ongoing stand that Valero should not support their campaign in any way,” Young added. “I call on all prospective candidates in the November election to make this pledge. If no candidate is willing to be supported by this PAC, where will they spend all of their money?”
Young’s statement comes as the Valero refinery has been receiving some negative attention.
The Bay Area Air Quality Management District announced in January that it was seeking a legally binding order against the refinery to correct “significant excess emissions violations.” The district alleges that Valero didn’t report that more than 8,000 tons of excess emissions came from the plant over a 16-year period.
Last November, a contractor was found dead hanging from a scaffolding ladder by his safety harness over a piece of refinery equipment.
Valero is the largest employer in Benicia, employing more than 400 people. The plant processed 165,000 barrels of oil each day, according to its website.
Campaign records show that from July 1 through Dec. 31, 2021, the PAC spent more than $5,000 with Sacramento-based Nielsen Merksamer Parrinello Gross & Leonli LLP for campaign services.
Young, who has opened a 2024 re-election campaign, reported raising no contributions and only spending $29 during the second half of 2021. The campaign reported having about $900.
Meanwhile, both Largaespada and Strawbridge, who are up for re-election this November, reported no activity during the same period.
(Chris Riley/Times-Herald) The city of Benicia was given a shelter in place alert and areas south of the Valero Refinery were evacuated after a power outage caused a flare up sending plumes of black smoke across Interstate 680.
By Grant Cooke, Benicia Resident and President Ag Tech Blends, September 24, 2020
Grant Cooke
I recently warned that Benicia faces a self-induced calamity. If the town doesn’t come to grips with the reality that it’s game over for the oil industry and that the tax revenue from Valero will end, the town’s future will be grim.
I suggested that by mid-century most, of it not, all Bay Area refineries—Valero included—would be shut. It may be sooner, as recently, Governor Gavin Newsom announced an executive order that would phase out gasoline-powered cars and pickups by 2035.
Most likely the big oil companies will do their best to delay this, but the direction is clear, California is turning away from fossil-powered vehicular transportation. Electric and hydrogen powered vehicles will be the norm sooner, instead of later.
The impact on Benicia and the other towns—Martinez, Rodeo, Richmond—will be significant. Unless those towns plan ahead—a troublesome chore for municipal governments—services will be drastically cut.
Secondly, if the refineries lock the gates and walk away, the cities will be stuck with the bill for cleaning up the hazardous waste that has accumulated for decades on the refinery property.
A couple of other points to consider. The first is the horrendous conflagrations that are besetting our state. Anyone who lives in California and doesn’t accept that climate change is real and life-threatening needs to talk to some of the state’s farmers who live that reality daily. Farmers know the weather and they know the ravages they are facing as the climate changes.
Climate change is not complex. It is caused by excess greenhouse gases caused by excess fossil fuel use. School kids can explain it.
The second is further from Benicia, but relevant. Over the last few weeks, a peace accord has been struck between Israel and the United Arab Emirates. Now Bahrain has joined and eventually Saudi Arabia and Iraq will also.
This is something I never dreamed I would see—peace in the Middle East. After all the trillions of dollars spent, the tragic deaths and wounded US soldiers, the horrific dismemberments by ISIS, and the millions of civilians who lost their homes, villages or lives; the wars are ending.
The stated reason for the accord is that the moderate nations are sick and tired of the Sunni and Shia extremists and decided that working with Israel with its military might and US backing is the lesser of two evils. These guys are ever pragmatists.
On the other hand, the unstated, but probably more significant reason, is the moderate nations, particularly UAE and Bahrain, have leaders who understand that they have to move away from oil-dependent economies. With a growing population of well-educated, underemployed and potentially restless citizens, change has to happen. The Middle East needs economic diversification with renewable energy, science, modern Western technology, risk capital and innovative thinkers, or the moderate nations are doomed.
This too is Benicia’s dilemma. Basically, the city is a mini petrostate with 45 percent of its tax revenue coming from Valero or related businesses. The city’s problem of dependency on oil tax revenue is the same as the Middle East nations, or Louisiana, or any other municipality that fails to plan for a non-carbon world. At least UAE and Bahrain have come to that realization.
If UAE and Bahrain can think this through, maybe Benicia can. The first step is to resist Valero’s and the union’s PAC to take over the city government in the November election. If the town’s oil interests and supporters control the city, planning for a diversified tax base won’t happen.
Vote for Steve Young and anyone else who is willing to refuse campaign contributions from Valero and the union PAC. That’s a simple step.
The next steps are going to be harder. The first is to bring the problem out in open. Ask Valero for their plans as the oil refinery winds down. What will be the decline in tax revenue? How much have they put aside for environmental cleanup? How many of their folks live in Benicia and what will be the job losses?
Supposedly, Valero says that it will be the “last man standing” or the final oil refinery left in the Bay Area. I doubt it. My bet is that Chevron in Richmond will hold out the longest because their corporate headquarters are in the Bay Area. Valero is a Texas company, which probably means they will be one of the first to shut.
The second step is that Benicia has to do what Bahrain is doing, namely diversify the tax revenue by moving from a fossil fuel to a knowledge-based economy. The world is full of examples of cities—Bristol, Vancouver, Melbourne, Singapore, come to mind—that have remade their economies.
There are several examples in the Bay Area—San Francisco, Walnut Creek, Livermore and Pleasanton.
The third step is probably the hardest still. The move to a robust knowledge-based economy with science, technology and innovation to produce wealth should be sub-regional—along the Straits. Benicia is going to have to cooperate with Vallejo.
Wealth is being generated all along 680 and both cities have to adapt quickly, or they will be left behind as Fairfield and Vacaville prosper by growing their knowledge and service-based economies.
Unfortunately, Benicia and Vallejo have flaws and neither has the ability to generate significant change. They do, however, have exceptional geography with beautiful waterfronts and spectacular views. They have more potential than other underdeveloped Bay Area cities, except maybe Richmond.
But neither can develop a robust new economy by themselves. They don’t have the resources or the willingness to overcome the differences that serious change requires.
There are no easy answers for remaking a city’s economy. It takes vision, hard work and a united citizenry with common goals and a willingness to change. Cities are like alcoholics; they usually don’t change their behavior until they reach rock bottom, or their livers give out.
The cities I mentioned that were able to remake their economies had remarkable good luck when a new company suddenly boomed—like Pleasanton with People Soft—or a brilliant and powerful leader like Willie Brown in San Francisco, who could wrench the existing power structure into action.
It is particularly hard for a small town like Benicia that has prospered along with a single industry and has a city council with decent folks but split agendas. Heaven knows there are small company towns—like Benicia—throughout the Rust Belt that are dead or dying because they waited until the gates were locked and the pink slips issued. Look what happened to Detroit.
The Bay Area is maybe the world’s center for science, technology, innovation and risk capital. It is an unparalleled combination that is being copied in China and on a smaller scale in Boston and Copenhagen. The mixture creates wealth like mountain snow creates mighty rivers. Despite the trillion-dollar successes of Apple, Google, Facebook and Sales Force, this era of magnificent knowledge-based companies is just starting. There are untold new wonders to be developed and decades to run.
It would be a pity if Benicia fails to participate.
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Grant Cooke is a Benicia resident and co-author of two books:
By Woodrow Clark II and Grant Cooke, published by Elsevier and available at Amazon:
SACRAMENTO, Calif.— As one of California’s largest oil producers enters bankruptcy, the Center for Biological Diversity and Sierra Club today urged Gov. Gavin Newsom to prevent California Resources Corporation and other troubled oil companies from shirking legal obligations to clean up their wells and prevent pollution. CRC filed for Chapter 11 bankruptcy on Wednesday.
Today’s letter calls on the governor to intervene in CRC’s bankruptcy proceedings to ensure the company sets aside enough money for well cleanup. CRC and its affiliates operate approximately 18,700 wells in California, which could cost more than $1 billion to properly plug, according to the Institute for Energy Economics and Financial Analysis. Of these, 7,826 are already “idle,” which means they’ve produced little to no oil in the past two years.
“Bankruptcy proceedings like these endanger California because oil companies like CRC can weaponize them to dump their environmental cleanup costs on the public,” said Kassie Siegel, an attorney at the Center for Biological Diversity. “Given the huge number of wells at stake, the Newsom administration should intervene quickly to protect the public from those costs and our environment from pollution. More big oil bankruptcies are coming, and Gov. Newsom has a responsibility to be ready.”
“CRC’s bankruptcy is likely just the first of many as the oil industry inevitably declines in California. Gov. Newsom has the tools to protect the public from Big Oil, but so far he hasn’t used them,” said Kathryn Phillips, director of the Sierra Club California. “It’s critical that Gov. Newsom ensure that failing oil companies are held accountable for cleaning up their own mess, rather than leaving taxpayers and workers to pay the price.”
Although oil companies are required to pay for the cost of properly plugging and abandoning wells, they have not set aside nearly the amount required for remediation. Statewide, the California Council on Science and Technology estimates that cleaning up California’s approximately 107,000 oil and gas wells would cost over $9.2 billion, yet the bonds that are supposed to cover these costs total only about $107 million.
Today’s letter also urges Gov. Newsom to take proactive steps to protect the public and the environment in anticipation of a likely wave of future oil and gas bankruptcies. These steps include:
Increasing and accelerating well plugging and abandonment requirements to reduce air and water pollution and create jobs.
Increasing bond requirements to ensure that oil and gas companies set aside enough financial resources to cover the full costs of remediation even if they become insolvent.
Ensuring that the oil and gas industry as a whole – not taxpayers –funds the remediation of truly “orphaned” wells, by increasing the administrative fee on well owners as needed.
Avoiding the accrual of additional well cleanup costs by halting approvals and permits for new oil and gas activity, including new wells and fracking permits.
Taking steps to ensure that oil and gas companies satisfy their obligations to workers by honoring their pension and healthcare commitments.
Despite the dire outlook for the company, Newsom has continued to issue CRC new permits to drill wells. State oil regulators have issued CRC and its affiliates permits to drill nearly 300 new wells so far this year, including 27 new permits in just the first week of July, all without conducting environmental review required by law. Newsom has approved this expansion of drilling operations despite CRC’s long record of violating safety and environmental regulations.
“As other companies flirt with insolvency, the governor should accelerate well remediation by solvent operators, increase bonding levels on existing wells, and stop digging the hole deeper by handing out new drilling permits,” said Siegel. “Forcing companies to clean up their own messes would create jobs, keep the public safe from unattended wells and make sure polluters are the ones paying for cleanup.”
Statewide, Newsom has issued 1,500 drilling permits for new wells so far this year. He also lifted a moratorium on fracking by authorizing 360 new fracking events over the past few months.
In 2014, CRC was created as a spin-off by Occidental Petroleum and took over Occidental’s California oil and gas wells. Since then, CRC has performed poorly, earning “junk bond” status from ratings agencies. CRC blamed the coronavirus pandemic and economic downturn for the bankruptcy, but CRC was at high risk of bankruptcy even before these events, as detailed in a report from the Institute for Energy Economics and Financial Analysis.
Every news analysis I’ve seen of Russia’s criminally ruthless war against Ukraine has focused on Putin’s nationalistic dream of the resurrection of the old Soviet Union and his Czarist ambitions.
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