A Crude Awakening The Oil Crash Essay

7 Feb 2007

Film Review – ‘A Crude Awakening – the Oil Crash’.

I had the pleasure of watching Basil Gelpke and Ray McCormack’s new film **’A Crude Awakening’** recently, and was very impressed. The film has had a small number of screenings in various parts of the world, and is due to be shown in a small number of cinemas in the UK in April. It will be shown on April 5th as part of the Transition Town Totnes programme at the Barn Cinema, Dartington. It is the noble successor to ‘The End of Suburbia (EoS)’, whose crown it steals, becoming, for me, the best exposition of the peak oil argument yet committed to film.

The ‘talking heads’ are very good, some of them familiar (Campbell, Simmons, Savinar..) and others not. All have useful insights to offer on the situation, from perspectives new to the peak oil debate. Unlike EoS’s’ focus on suburbia, or ‘the greatest misallocation of resources in the history of the world’ as it describes it, this film goes beyond the US experience, being more of a global film, focusing on Europe and the UK as much as the US. Whereas the recent movie ‘Crude Impact’ focuses on too many things and it ends up a rather confused and exhausting sprawl, Crude Awakening keeps its gaze purely on peak oil, and presents a well argued, well-paced, and well-edited summary of what peak oil is and what it will mean for us all.

It begins by discussing what an amazing material oil is, how it was formed and how much energy it contains. The message is simple; oil is a one-off extraordinary legacy left to us by history, a material which is so extraordinarily energy-dense that it is little wonder that we have sucked it out of the ground and built an entire society out of it in little over 150 years. As the film goes on to point out, this absurd degree of dependency cannot continue, due to the imminent peaking in world oil production. This is the first film to contain archive film of M.King Hubbert, it is fascinating to see the great man himself on US television in 1975.

It is a film which avoids over sensationalising the material, allowing the facts to speak for themselves. It isn’t overly explicit about what the impacts of peak oil might be, allowing the viewer to follow those trains of thought in his or her own head. I found it compelling viewing, which while not the edge of the seat ride that EoS was, impacted in a different way. Like EoS it refuses to offer a happy ending, resisting the temptation to end on a rallying call of solutions, choosing to close with a very short section of my friends Clare and Quentin gardening and putting the goats out in West Cork, which although gorgeous, presents, like EoS the idea that the cities and the suburbs have no future at all, and that a rural idyll will be our only option. Perhaps some funky urban agriculture might have been a closing shot that would have resonate with more people.

Like EoS, its power lies in not sugaring the pill with lots of solutions. It takes you to a place where the enormity of the challenge sets in and leaves you there. It is a powerful, if upsetting, place to visit, but an essential part of peoples’ journeys through this. We might question how many of the unconverted would actually go and see a film called *”A Crude Awakening – the Oil Crash”*, it’ll be interesting to see how it does in the cinemas. As an activist, I feel this is an important tool. It is a peak oil film with great gravitas, and is one that will do a great deal to communicate the message. Organise a screening, get it out there, this is a powerful ally.

Week of 6.16.06

Crude Awakening

This Week:Crude Awakening | Whistleblower: A Former Government Employee Speaks Out | FAQ: Oil and Gas Royalty Relief | Essay: Trivializing Corruption | Transcript

As oil and gas companies continue to make enormous profits in a time of record-high gas prices, watchdog groups are accusing these companies of shortchanging American taxpayers out of billions of dollars in royalties for drilling rights on public property. Members of Congress are also being blamed for making sweetheart deals with Big Oil engineered to avoid the payment of royalties.

"These oil companies along with some members of Congress have really engineered one of the greatest train robberies of all time," says California Congressman George Miller.

You might not realize it, but American taxpayers own some very valuable property, some of it located in the deep waters of the Gulf of Mexico. If oil and gas companies want to drill on this territory they are required to lease it out from the U.S. government, which collects royalties from them on the taxpayers' behalf.

Big Money

It's no paltry sum. Royalties from oil and gas exploration are the government's second largest source of revenue, behind income tax.

"I think the American taxpayers are losing billions of dollars," Kevin Gambrell, former director of the Federal Indian Minerals Office in Farmington, New Mexico, told NOW.

Gambrell worked for seven years collecting royalties from petroleum companies working on federal and Native American lands in the Four Corners region.

"I think oil and gas companies were always trying to figure out how not to pay royalties or to pay as little as possible," Gambrell said.

He said he caught many oil and gas companies lying and cheating to avoid paying the full royalties owed. He adds that when he tried to go after a company for the royalties they owed, he received phone calls from Congressional offices leaning on him to side with industry.

The Royalty Treatment

CompanyAnnual Profits
From 2004
ExxonMobil$36.1 billion43%
Royal Dutch Shell$25.3 billion37%
BP$22.3 billion31%
ConocoPhillips$13.5 billion66%
Chevron Texaco$14.1 billion6%
Back in 1995, Congress passed the Deep Water Royalty Relief Act that reduced the amount of royalties oil and gas companies had to pay. At the time, when gas prices were fairly low, the move was seen by many as an incentive to get petroleum companies to drill for oil and natural gas and keep energy production inside the United States.

Since then, a number of other royalty relief measures have been passed, such as the one included in the most recent energy bill, signed last summer, which increased the amount of oil that can be drilled without paying royalties.

Royalty relief under the 1995 act could cost taxpayers up to $80 billion over the next twenty-five years, depending upon the outcome of an industry lawsuit, according to a recent draft report by the Government Accountability Office. This includes a mistake by the government when drawing up some of the royalty agreements, which could cost $10 billion.

Who's following the money, and who's keeping it? Get ready for a crude awakening. Next time on NOW.

Related Links:

Statement by Walter Cruickshank, Deputy Director, Minerals Management Service, United States Department of the Interior, before the Committee on Government Reform, Subcommittee on Energy and Resources, United States House or Representatives, March 1, 2006. [Requires Adobe Reader]

Statement by the Kerr-McGee Corporation, an oil company that has sued the Bush administration to expand royalty relief. [Requires Adobe Reader]

Government Accountablity Office: Briefing on Oil and Gas Royalties, March 27, 2006 [Requires Adobe Reader]

Report of the National Energy Policy Development Group, May 2001 [3MB - Requires Adobe Reader]

Department of the Interior, Audit of the Minerals Management Service, March 2003 [2MB - Requires Adobe Reader]

NOW: Crude Behavior: An investigation on the oil industry

Find out the average price of gas in your locale by using the AAA's Fuel Gauge Report.

Also this week, a video interview and essay on big money and government by David Sirota and viewers respond to last week's program "Who Killed the Electric Car"

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