Daily Archives: December 20, 2010

Oil Found in Kenya and Jamaica, Who Really Benefits?

 

By Andre Michael Eggelletion

Gippsland Offshore, the same oil exploration firm that found oil in Jamaica in 2009, has now completed negotiations with the Government of Kenya to enter the next exploration term for its L-6 permit. The Kenyan government began the licensing process for petroleum exploration in June 2009. Gippsland Offshore and its partner in the L-6 venture, Pancontinental Oil and Gas, share a 60 percent/40 percent stake respectively. Pancontinental Oil & Gas (ASX:PCL) also has a 25 percent interest in a license to explore the L-8 Mbawa area in the offshore waters of Kenya. Pancontinental has determined the L-8 area exceeds the potential for 1 billion barrels of recoverable oil, or 1 trillion cubic feet of recoverable gas. Future estimates are expected to be revised up or down to some extent. New 3D mapping began three months ago, and are near to finding a drilling site. With water depth in the L-8 area only about 800 meters, it’s easily within the range of modern drilling and production equipment.

The L-6 and the L-8 areas of Kenya, covering the offshore Lamu and Mbawa Basins repsectively parallel the history of petro-geological profiles in Jamaica. Indeed, a great deal of East Africa has been poorly explored historically. However, new technologies have allowed better and easier exploration. In Kenya, a total of seven prospects have been mapped, both on and off-shore. They are highly prospective and are supported by oil and gas shows in wells and seeps in the region. The first petro-geological profiles of Jamaican territories were conducted in 1955 and 1973, and according to the Geological Society of Trinidad and Tobago, again in 1981, and 1983. What did they conclude? According to the Journal of Petroleum Geology, eleven wells were drilled in Jamaican territory over a 27–year period commencing in 1955: all were abandoned as dry. These combined results would suggest that conditions did not favor the generation, accumulation and preservation of petroleum in Jamaica. Twenty six years later in 2009, another profile was conducted, and this time, they found oil. According to Oil Voice: Gippsland Offshore Petroleum is a 50% equity partner in the Jamaica Joint Venture (JJV) that has 5 exploration permits over 14,500km2 of frontier exploration acreage offshore Jamaica over the majority of the Walton Basin. Of the 11 wells that had been drilled in and around the basin, 10 of them had oil. Seven prospects have been mapped with upside potential for greater than 2 billion barrels of recoverable oil.

Both Jamaica and Kenya offer high petroleum prospectivity, in that they import 100 percent of their oil. They also offer attractive government commercial terms, and Kenya particularly, offers proximity to the growing markets in East Africa and India. Both these areas of the world now form a high quality component of Gippsland Offshore’s ongoing exploration portfolio. That’s great news for Gippsland and its shareholders. But what about the owners of these newly discovered, and highly lucrative natural resources?

I can only imagine what this discovery will mean to Kenya and Jamaica. The discovery of this oil should mean an end to their sovereign debt burdens, but given the history of how things of this nature are usually resolved; I’m not so sure that it will. The reality of the oil situation in the Caribbean is probably much worse than some may inductively consider. I wrote about this in my book, “Where the Right Went Wrong on National Security (and the Left too).” The way it has historically worked is that every time poor countries have been found to poses such valuable natural resources, control is lost due to privatization. When the leaders of these countries do not accept losing the tremendous prosperity offered by their resources, and opt for their nationalization, a coup or assassination usually follows. Instead of these discoveries improving the quality of life for people sitting on these resources in the less-developed world, historically they are either sold-out by their leaders or robbed by pirate corporations from powerful nations. They usually end up enslaved and being forced to live in increased pollution, poverty, and dislocation. I hope it’s different this time.  

New warheads for Russian missiles, No START Yet?

 

By Andre Michael Eggelletion

Republican leaders in the U.S. Senate want to obstruct ratification of the START Treaty while Russia gets new warheads for all of their active intercontinental missiles. According to “The Voice of Russia,” the chief designer of the Bulava missile, Yuri Solomonov, says the modifications will occur before 2016.

The number of missiles are said to comply with the latest Russian-American strategic arms reduction treaty, signed at a summit in Prague on April 8th. The latest Strategic Arms Reduction Treaty (START) proposal commits Russia and the US to reducing the nuclear warheads on each side by one third, and the strategic delivery vehicles, by more than one half.

Historically, START has received bipartisan support, including from much of the Republican establishment and military elite (PragueProject), however the incoming freshman class of Republican senators, particularly those associated with the Tea Party movement, has expressed considerable reservations with the treaty (FP). The current math for ratification would require the fifty-eight sitting Democrats (including two caucusing Independents) to procure nine additional, Republican votes.

Why Republicans oppose the START Treaty

Sen. Lindsey Graham (R-SC), decided against his previously declared support for approval, out of his discontent over the “Don’t Ask, Don’t Tell” bill. “If you really want to have a chance of passing START, you better start over and do it in the next Congress because this lame duck has been poisoned,” said Graham on CBS, commenting his decision.

The Obama administration is not surprised that Sen. Mitch Mc Connell (R-KY) the incoming Senate Majority Leader is opposed to the treaty. Proponents of the treaty should hope the level of aggressiveness by Republican leaders in opposition doesn’t become infectious. “I’ve decided that I cannot support the treaty,” Senator McConnell said on CNN. “I think the verification provisions are inadequate and I do worry about the missile-defense implications of it.”

Writing off cooperation from McConnell, the President has still tried to assuage the concerns of Senate Minority Whip Jon Kyl (R-AZ) (NewsHour), by agreeing to a 10-year $85 billion program to modernize the nation’s nuclear weapons complex. Still, Jon Kyl stated to Fox News that he would vote against the approval unless it was amended.

The fate of the treaty remains unclear as long as Republicans remain committed to their total obstruction of President Obama’s every proposal. This really exposes something dark in their thinking. They seem to be willing to risk the ability of Washington and the Kremlin to verify the status of the world’s most dangerous weapons, and the strategic intent of both sides in their use. They are willing to disrupt or dismantle U.S.-Russian cooperation (NYT) on a host of international issues including terrorism and the Iranian nuclear program. I know I’m not alone in my view that this amounts to incommensurable recklessness on the part of GOP leaders. To them, it seems there is no price too high for their political gains and the nullification of President Obama. One person who agrees with me is Max Bergmann, at the Center for American Progress. Mr. Bergmann has voiced frustration at such superficial objections motivated by base political gamesmanship.

The United States has not had a verification regime in place (ArmsControlToday) since the original START treaty expired in December 2009. It’s time the ability to verify the capabilities and intent surround these weapons is restored. History may record this as another example of where the Right went wrong on national security.

 

 

Study Shows 2010 Midterm Voters Badly Misinformed

 

By Andre Michael Eggelletion

A recent poll by the University of Maryland recently found strong evidence that voters were substantially misinformed on many of the key issues of the 2010 midterm election. Such misinformation was correlated with how people voted and their exposure to various news sources. If you’re wondering who those news sources were, just remember that the vast majority of voices on the radio are Republicans and Fox News by far has the highest ratings. I think that narrows a lot of it down.

In spite of a solid consensus of non-partisan government agencies, economists and scientists, voters were still duped by misinformation. Some of the things incorrectly believed by the voting public were:

Did the stimulus create or lose jobs?

The Congressional Budget Office (CBO) concluded that the stimulus legislation has saved or created 2 to 5.2 million jobs. But only 8% of voters thought most economists who had studied it concluded that the stimulus legislation had created or saved several million jobs. Most (68%) believed that economists estimate that it only created or saved a few jobs and 20% even believed that it resulted in job losses.

Would Obamacare reduce or increase the deficit?

Though the CBO concluded that the health reform law would reduce the budget deficit, 53% of voters thought most economists have concluded that health reform will increase the deficit. Though the Department of Commerce says that the US economy began to recover from recession in the third quarter of 2009 and has continued to grow since then, only 44% of voters thought the economy is starting to recover, while 55% thought the economy is still getting worse.

Does science confirm climate change?

Though the National Academy of Sciences has concluded that climate change is occurring, 45% of voters thought most scientists think climate change is not occurring (12%) or that scientists are evenly divided (33%).

Did President Obama initiate the bailouts?

40% of voters believed incorrectly that the TARP legislation was initiated under Barack Obama, rather than George Bush. 53% thought that the bailout of GM and Chrysler occurred only under Obama, though it was initiated under Bush  

Have your taxes gone up or down under Obama?

54% believed that there were no tax cuts in the stimulus legislation. 86% assumed their taxes had gone up (38%) or stayed the same (48%), while only 10% were aware that their taxes had gone down since 2009

Areas where Republican voters were duped

The poll also found significant differences depending how people voted. Those who voted Republican were more likely than those who voted Democratic to believe that: most economists have concluded that the health care law will increase the deficit (voted Republican 73%, voted Democratic 31%); the American economy is still getting worse (72% to 36%); the stimulus legislation did not include any tax cuts (67% to 42%); most scientists do not agree that climate change is occurring (62% to 26%); and it is not clear that Obama was born within the United States (64% to 18%)

Areas where Democrat voters were duped

On the other hand those who voted Democratic were more likely to incorrectly believe that: it was proven to be true that the US Chamber of Commerce was spending large amounts of foreign money to support Republican candidates (voted Democratic 57%, voted Republican 9%); Obama has not increased the level of troops in Afghanistan (51% to 39%); and Democratic legislators did not mostly vote in favor of TARP (56% to 14%).

In most cases those who had greater levels of exposure to news sources had lower levels of misinformation. There were, however, a number of cases where greater exposure to a particular news source increased misinformation on some issues.

The Fox News effect

Those who watched Fox News almost daily were significantly more likely than those who never watched it to believe that most economists estimate the stimulus caused job losses (12 points more likely), most economists have estimated the health care law will worsen the deficit (31 points), the economy is getting worse (26 points), most scientists do not agree that climate change is occurring (30 points), the stimulus legislation did not include any tax cuts (14 points), their own income taxes have gone up (14 points), the auto bailout only occurred under Obama (13 points), when TARP came up for a vote most Republicans opposed it (12 points) and that it is not clear that Obama was born in the United States (31 points). The effect was also not simply a function of partisan bias, as people who voted Democratic and watched Fox News were also more likely to have such misinformation than those who did not watch it–though by a lesser margin than those who voted Republican.

The effect from the Left

There were cases with some other news sources as well. Daily consumers of MSNBC and public broadcasting (NPR and PBS) were higher (34 points and 25 points respectively) in believing that it was proven that the US Chamber of Commerce was spending money raised from foreign sources to support Republican candidates. Daily watchers of network TV news broadcasts were 12 points higher in believing that TARP was signed into law by President Obama, and 11 points higher in believing that most Republicans oppose TARP.

The poll of 848 Americans was fielded from November 6 to 15, 2010. The margin of error is plus or minus 3.4 percent.

Source: http://www.worldpublicopinion.org/pipa/pdf/dec10/Misinformation_Dec10_rpt.pdf