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PBS: Extreme Oil

Stephen Segaller
Executive Producer
Tuesday, September 14, 2004; 1:00 PM

"Extreme Oil" looks at how far the oil industry has to find new resources to drive the world's fuel economy and the many energy aspects of modern life. The series examines the difficulties of balancing the quest for new energy resources with security risks, environmental safety and the ethics of disrupting lives while tapping into tomorrow's reserves. From the construction of a massive pipeline that flows through some of the most unstable corners of the world to the debate over the Arctic National Wildlife Refuge (ANWR) and the new oil boom in Africa, the three-part PBS series is a voyage of discovery through the world's newest oil-producing regions.

Executive producer Stephen Segaller was online Tuesday, Sept. 14, at 1 p.m. ET, to discuss the program.


"Extreme Oil" airs on PBS Mondays, Sept. 13-27, 2004, at 10 p.m. ET. (Check local listings).

Editor's Note: Washingtonpost.com moderators retain editorial control over Live Online discussions and choose the most relevant questions for guests and hosts; guests and hosts can decline to answer questions.

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Stephen Segaller: Hello, I'm Stephen segaller at WNET in New York.

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Laurel, Md.: I watched your show last night and thought you were trying to make your documentary about building the Azerbajian pipeline look like a James Bond movie.

I was expecting to see some insight as to why the price of gasoline has approximately doubled since Exxon and Mobil, BP and Amoco, and Chevron and Texaco merged in the last six years.

But you played down the role of oil companies and up the role of security and corruption in small nations. Are we going to see anything about the role lack of competition plays in setting prices?

Stephen Segaller: I don't think we played down the role of oil companies. Getting oil from where it is to where it's needed is what oil companies do. In every one of the seven or eight countries we visited, it's the oil companies who extract, ship, or pipe the oil. It's a very tough and dangerous business - something we don't much think about on the clean garages along our streets.
I'm not sure mergers have caused prices to rise - they may have contributed. But global economic and political disruption - and greater competition - play a part. The rapid industrialization of China depends on energy, and China is a huge importer of oil. That wasn't tru a dozen years ago.

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Arlington, Va.: Some groups have said that in order to just maintain current petroleum production rates, prices will rise because the oil is getting harder to extract, and of course to increase production (if that is even possible) to meet growing demand would mean even higher prices. Others seem to be saying that there is enough excess capacity or untapped "easy" oil that rising demand can be met while maintaining basically current prices. Which is closer to the truth ? Given that our current economy and way of life seems so tied to the premise of stable, relatively low petroleum prices why has this not received serious discussion in this election (beyond just claiming that one candidate or another will ‘reduce our dependence on foreign oil') ?

Stephen Segaller: I'm not sure that anyone really knows. It's pure supply and demand. If the price is high enough, the cost of discovering and extracting "hard oil" can be covered. There is no question that the present and future global economy is tied to oil or energy generally being available - indefinitely. Energy security or independence is a great goal - there aren't any easy ways to get there.

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Eau Claire, Wis.: Showing the American people the extreme effort that is undertaken to supply them with petroleum is something that has been long overdue. I think your series will help open up the eyes of the consumers to the geopolitical world of oil and the environmental costs of oil exploration. As a veteran of the Persian Gulf War, I have seen the Royal Dutch Shell, Samarec, and Aramco operations along the northeastern coast of Saudi Arabia. I was amazed at the scale and capital devoted to oil production, and I developed a great appreciation for this resource as a participant in an "oil war". I greatly enjoyed part one of your series and look forward to parts two and three. Thanks for making this wonderful series.

Stephen Segaller: Thank you. We wanted to give viewers a sense of the trade-offs we're all involved in if we use the product. It makes no sense to say the oil companies are bad environmental citizens, any more than it is true to say that drivers are bad citizens because they pollute the atmosphere too. We wanted to offer a sense of the complexity of the issues - political, technological, environmental and ethical...

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Mt. Lebanon, Pa.: 1. What's the REAL expected date of first oil pumping through the pipeline?

2. Did they tell you how many days it would take to fill the pipeline from initial injection?

3. Do you recall all of the flawed and failed pipeline welds we had back home - Anchorage is my hometown - when TAPS was first placed into operation (1976?)? By the way TAPS came in 10 times over budget - just under $10B. What are they expecting here for flawed welds and cost overruns?

4. What's the diameter of the oil pipe. I couldnt' quite make it out from my TV set?

5. What's the nominal depth of burial to the top of the pipeline? And will it be enough given the explosive power of armored shells and plastic explosive?

Glad it's not my project to agonize over. Buried pipelines and pump stations are notorious maintenance headaches even in stable, civilized parts of the world.

Thanks much. Professional Consulting Engineer

Stephen Segaller: 1. 2005 projected, I don't know if it's real.
2. No
3. Watch on September 27 - the third epsiode, The Wilderness is all about Alaska and Alberta.
4. About 3 metres, 9-10 feet.
5. It's buried about ten feet deep. Not sure how armored it is.

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Fairfax, Va.: I understand the world has a large supply of tar sand that contains a great deal of extractable oil. Has any progress been made on making this economically feasable?

Stephen Segaller: We cover that very topic in episode 3, on September 27 in most places - The Wilderness. We go to Alaska and Washington DC for the debate over the ANWAR, but also to Alberta where tar sands are being exploited in a huge way. It is said that by counting the oil in tar sands, the estimated global oil reserves were upped by the biggest amount ever.

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Jamaica, NY: How do the issues with oil in the Middle East differ from the ones we saw in the show last night? Do you do any programs that deal with the Middle East?

Stephen Segaller: We don't cover the Middle East, because it's the most familiar. The central issue there is political instability, clearly. It's at least partly because of that instability that we look at three other regions of the world where the oil companies and nations dependent on oil have to explore and extract - Alaska & Canada, Africa, and Central Asia.

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Takoma Park, Md.: Hello Stephen. I would like to ask about oil discovery rates. Is it true that for every barrel of oil that is being discovered this year four or five are being burned?

Stephen Segaller: You'll get different numbers from every expert, but there's some agreement that "soon" - in the next ten years - the consumption will exceed the discovery rate.

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Naples, Fla.: Please comment on the industry's claims (including in several recent law suits and protests in developing countries) that doing business according to the corrupt practices of developing nations exempts the industry from liability to indigenous people for unsafe practices (such as Texaco's unlined disposal pits in the Ecuadorian rainforest). Considering that the indigenous do not consider their nations' governments as acting in their interests, who should be responsible to these people for increased cancer rates, decreasing food supplies, and a general state of chaos allegedly caused by pollution as well as colonial encroachment into their territories?

Stephen Segaller: Please watch next week's program, The Oil Curse (Sept 20) when we cover exactly this subject. In Ecuador, there is a landmark lawsuit now in court in which Texaco faces huge damages if it is found responsible for the environmental and health consequences of drilling there in the 1970s. But by contrast in Angola, Chevron Texaco today is working closely with USAID and other agencies to ensure that local populations benefit from the presence of oil companies. Stay tuned!

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Rochester NY: Hi,
I saw the "Pipeline" show on PBS last night and found myself wondering if Putin's latest moves to increase control over the government have more to do with controlling oil than terrorism? Any reaction to this idea?

Thanks.

Stephen Segaller: I can't answer that exactly, but it's clear that Russia today has less access to oil than the Soviet union did - much of the reserves are in former Soviet Republics like Azerbaijan. Every industrialized nation has to be concerned about how to keep its economy going at eevry level if the supply of energy is limited, rationed, or withheld.

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Saint Paul, Minn.: The diameter of the pipeline could not be more than 1.5 meters. L. Sullivan, Petroleum Engineer

Stephen Segaller: Thank you for the correction.

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Deerfield beach, Fla.: how high can oil prices go?

I have heard that bin laden has a price that he came up with. Is that true? What is that price?

Stephen Segaller: supply and demand

Stephen Segaller: supply and demand will answer that question. The price is suppressed only by an unwillingness to pay. Like Broadway tickets at $100, quickly followed by even more exclusive tickets at $500.
I'm not aware of a Bin laden pricepoint.

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Hartford, Conn.: A few questions for you:
What's the solution, in your opinion, to solving the oil crisis and easing our national dependency on that resource?
Are there alternatives that are viable at this time that we, as a country, aren't taking advantage of?
Are alternatives covered in the series?
Thanks for doing the topic.

Stephen Segaller: 1. More supply, less demand, or alternatives. There are no other answers. One reason (some) people are so concerned about ANWAR (see episode 3 on Sept 27) is that they feel if we're willing to drill in (and risk) the wilderness, will we be willing to drill offshore along the eastern seaboard - where there may also be oil. It's a matter of trade-offs - the risks we can tolerate for the security we demand.
Clearly higher MPG would reduce demand a bit. But the great hope is perhaps Hydrogen-power. This series doesn't look at alternatives - we might do that in a future series.

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Detroit, Mich.: Did your crew really get arrested while filming the show? How dangerous was it?

Stephen Segaller: They were arrested twice - in Azerbaijan. It's always hard to know how dangerous it is in such cases - It's no fun being arrested, or filming in minefields in Angola, for example (episode two, Sept 20). But the film-makers are intrepid and adventurous types.

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Edmonton, Alberta: Alberta's oil sands are recognized by USDOE as holding 170 billion barrels of proven reserves, and up to 350 billion ulitimately recoverable (Saudi Arabian reserves are 230 billion). My familiarity with this resource makes me concerned about your program's presentation - based on your website's description: "pristine forest landscape -- perhaps a model for the ANWR project -- that has become the extraction site of what some call "the world's worst oil."

First, there is no honest way to compare ANWR (3-5 bill bls max. of conventional oil) with the oil sands. Second, oil sands prod'n is now 1 million bl/day, and forecast to be 2 mill by 2010, 3 mill by 2015, and potentially over 8 mill by 2050. This huge resource, in a stable freindly NAFTA partner right next door is the best hope for the U.S. to reduce reliance on OPEC imports. (Alberta already provides 10% of U.S. crude imports). Third, oil sands producers take their environmental responsibilities very seriously. They reclaim all land (muskeg and scrub brush actually) disturbed during extraction, maintain water quality, and are vigourously developing technology to reduce CO2 emmissions - including reinjection that will increase extraction efficiency. Advances in oil sands technology to date have been most impressive - reducing the per barrel costs of its high-grade synthetic crude from $30 two decades ago to
$8-11 today. Will your program provide a balanced perspective on the oil sands, and if not, why? Hope to see a reply. Thanks.

Stephen Segaller: I hope you'll watch the program on Sept 27 (The Wilderness) and see that it's balanced in its presentation. One of the corporate guys in the Alberta tar sands operation himself describes it as "not benign" but we have other people who make the point that North American environmental controls are so much tougher than elsewhere in the world that it's better to be getting the oil here than elsewhere. Local First Nations people describe the replanting and restoration of the landscapes.
We also represent the Candian concern that Candian reserves are becoming "America's gas tank". Please watch & let us know.

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Nashville, Tenn.: It's been long reported that the BTC Pipeline is an effort to squeeze out Russia from access to much of the Caspian Sea resources. Does the pipeline from Baku through Grozny, Chechnya, still operate given the war situation there and what are the foreseen political dynamics of that situation? With greater political control over Russia, what likelihood is there that Putin will invade Azerbaijan in the interest of recovering a former Soviet state and a major source of oil?

Stephen Segaller: It's scheduled to go on stream next year.

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Yelm, Wash.: you mention
"some agreement that "soon" - in the next ten years - the consumption will exceed the discovery rate."

Given that, would it not be vitally important to our economy to begin a national debate over preparations for the energy economy we will have to transition to after petroleum production enters it's decline?

Stephen Segaller: You bet. I hope the series will contribute to that debate.

Stephen Segaller: The difficulty is knowing when to project that transition, and how to base it on reliable information.

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Rumson, N.J.: Interesting show...can you explain the relationship between the refugees we saw in last night's episode and the overall oil story? And did you uncover why they have to live under such conditions?

Stephen Segaller: It's one of those post-Cold War legacies. They are Azeri refugees from a part of Armenia that used to be under the control of Azerbaijan - called Nagorno-Karabakh. They are illustrative of the kind of simmering threat of conflict that affects the planning of this, or other pipelines. I think they are stuck there becuase they can't settle in Azerbaijan, and they can't cross back to where they fled from.
Another related issue is the fact that in Turkey there are Kurdish nationalists who have used violence as part of their campaign. If the pipeline were to be routed through areas where their population is concentrated, there could be the risk of sabotage. Hence, the pipeline makes a great big turn west and south to get to Ceyhan.

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Minneapolis, Minnesota: Was the series shot on film or tape? If tape, what format? Also HD or SD? Pictures looked good.

Stephen Segaller: It was shot on Standard Definition, and mostly small format, tape cameras. Sony PD150, etc. They are wonderful for this kind of flexible, adventurous shooting.

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Wheaton, Md.: If the west is to continue to depend on oil from arab-occupied countries, how long until this supply would run out?

Stephen Segaller: I can't answer that. But remember, we depend heavily, but not exclusively, on oil from the Middle East. But I think Russia has the second-largest oil resevres after Saudi Arabia, for example. The US produces about 20% or so of its oil domestically. Oil is found in China, Norway, the UK, Sudan, Angola. Places where oil is expected to be found also become the sudden focus of a great deal of interest - both at national government level, and oil companies. See for example the islands of Sao Tome, off Nigeria; and the Spratly Islands, in the South China Sea. Both are relatively insignificant dots of land, with major oil reserves proven or suspected - and their status and importance increases accordingly.

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Washington, D.C.: The show said that the pipeline discussed in last night's episode is going to be a major supplier for China. Do you know from where Asia currently gets its oil and whether they are feeling the same timeclock-crunch to find alternate resources like us?

Stephen Segaller: No, this pipeline goes west and south to the Mediterranean, supplying Europe mostly. There is another pipeline, on the eastern side of the Caspian, heading east. China has transformed the global oil market in the last dozen years. Their national oil corporation is all over the world looking for oil exploration and supply contracts, because China's rapid industrialization depends ona continuing supply of oil that exceeds China's domestic production and reserves. In a few years' time China will outstrip Japan as Asia's largest consumer of oil.

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Ocean, N.J.: How did you find your stories for this series? I had not heard about the BTC pipeline before seeing the show...is it a well known project overseas?

Stephen Segaller: Good research team, I guess. We looked at big themes - the extremes of political, environmental, ethical and technological challenges to the pursuit of oil worldwide, researched a lot of them, and narrowed down to these three programs: The Pipeline, The Oil Curse, and the Wilderness. The BTC pipeline is one of the larger engineering ventures, backed by a consortium of several nationalities, led by BP. Well known in the industry, less so to the public in Europe or elsewhere. But our series is airing on the BBC at the same time, and it aired already in Canada on the CBC.

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Baltimore, Md.: Just logged onto the discussion - the subject matter caught my eye. Missed the show last night....will it air again?

Stephen Segaller: Last night's show, probably not (for a while at least) but episodes 2 and 3, next Monday at 10 in Baltimore, 11 in DC. And check out our program website: www.pbs.org/extremeoil

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Washington, D.C.: With Mexico as a major oil supplier right on our border, why don't US oil companies initiate a major initiative to explore, drill, import, etc. as much oil as possible from them? No major pipeleines to build, no possible oil tanker spillages, no delays in transport, no unstable and despotic countries to deal with -- and, this would not only help our economy and energy needs, but significantly bolster Mexico's economy.

Stephen Segaller: I think you'll find that energy security is making Venezuela, Colombia, Ecuador, and Mexico all more important in US geo-political thinking, and you make a good point about accessibility.

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Saint Paul, Minn.: Stephen, what a great project and a fine film. I have worked in international oil for over 20 years and found your insight very accurate. I have 10 years of university education and 20 years of experience. I always tried to help locals get a foot hold in this crazy business but they just do not have the education, skills and refinement. In Gabon, I tried to train locals in drilling engineering but they did not have the basic mechanical mindset so needed to do this work. The opposite was true in Norway: I was training them in new drilling and guess what? The took the technology, made it better and now lead the world in it! It is the mindset. Norwegians used to go to sea to fish-now they fish for oil and have the mindset.

Keep up the good work. We need folks like you to show the world the dramatic effect oil and gas development has on locals.

Stephen Segaller: Very pleased to hear your reaction. Thanks.

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Duluth, Minn.: Mr. Segaller:

I watched Part I of Extreme Oil last night- and was prepared for an onslaught of propaganda. (Against the Oil Industry and Americans). Excellent program!! You did a great job. (My car has been stored for winter and I'll be on foot and skiis for the next nine months. It's not much but it's one less person driving.) In any event:

You had a quick shot of a survey crew. Can you please tell me where I can find a list of contractors bidding on the prelim/stakeout surveys for this PL? Im a surveying/mapping tech. and worked in the Prudhoe Bay Oil Fields on the Arctic North Slopes in AK. No big proj.coming up there, and the economy is tight here in Northern MN. I'd do anything to get on this project.

Thanks if you can point me in the right direction- Sarah

Stephen Segaller: The pipeline is being built by BTC, led by BP. Headquartered in Baku, Azerbaijan. Try their website ? Good luck!

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Stephen Segaller: Thanks for all your very interesting questions. I'm sorry I couldn't answer more of them, or the more technical ones. Please do visit the website for the series www.pbs.org/extremeoil and stay tuned on September 20 and 27 for The Oil Curse and The Wilderness.

best to all
Stephen

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