Private Empire: ExxonMobil and American Power

by Steve Coll

  In 1999, to memorialize the tenth anniversary of the Exxon Valdez spill, reporters and camera crews descended on Prince William Sound. ExxonMobil spokespeople emphasized that the sound’s beaches were free of oil—as was true, at least on the surface—and that wildlife in the region had recovered, as was also true, generally speaking. And yet some area residents claimed that they had accidentally set a few oiled Prince William Sound beaches on fire while camping. Dave Janka had discovered beaches around Knight Island where he could easily dig beneath the rocks and find pockets of fresh oil. Where had the oil come from? Was it left over from the Valdez? During the tenth anniversary season, Janka ferried media crews to those beaches and helped the reporters dig out handfuls of oil to show their audiences. “There was a considerable range of opinion” about whether Prince William Sound remained burdened by submerged Valdez oil, Jeffrey Short recalled. So, around the time of the anniversary, he proposed a study “to actually measure how much oil was on the beach, which had never been done before and was widely viewed as impossible.” Given the findings about oil’s sublethal effects, if the oil was still around the Sound, hidden, it might pose persistent dangers.8

  Two scientists at the United States Geological Survey, Jim Bodkin and Brenda Bellachey, were in the meantime intrigued by a second biological mystery in local wildlife populations. Scientists funded by a trust established with proceeds from the Exxon legal settlement had discovered elevated levels of an enzyme known as P450 in sea otters and harlequin ducks. Biologists sometimes track the enzyme because it increases in an animal’s liver if the creature is exposed to oil or other pollutants. Where was the pollution coming from? All of the scientists studying Prince William Sound could see that residual oil on the surface of the beaches was declining almost to the vanishing point, and that tides and rain were chipping away at what little remained on the surfaces of rocks. Did significant quantities of oil that nobody could see persist around the sound and were they somehow getting into the sea otters’ food chain or ecosystem?9

  If there was persistent oil, it had to lie below the surface. Jeep Rice, a biologist at Auke Bay who specialized in toxicology, Mandy Lindeberg, and Jeffrey Short recruited a statistician to help them design a random sampling on the sound’s beaches. On each beach segment, they would stretch out surveyor’s tape and implant stakes to initially divide beaches into squares, at randomly selected locations, and then dig. Short feared that the whole project could prove to be an embarrassment; they would dig seven thousand holes, spend hundreds of thousands of taxpayer dollars, and find perhaps four or five pockets of persistent Valdez oil. As it turned out, Mandy Lindeberg’s pit-digging teams almost immediately struck fresh oil—oil that had not been weatherized into relatively harmless tar balls, but which seemed to be preserved beneath the rocks, as fresh—and toxic—as the day it spilled from the Exxon Valdez. Her initial findings meant that fresh oil had survived in many more places inhabited by the sound’s wildlife than had previously been contemplated, which might have implications for ExxonMobil’s liability under the reopener clause. Accounts of her initial findings reached the Alaskan press in May 2001. “Within about a week,” recalled her colleague Jeep Rice, “she’s being followed” by the ExxonMobil cruise ship.

  Letters arrived at Auke Bay from O’Melveny & Myers, a large corporate law firm based in Los Angeles. They contained Freedom of Information Act requests from ExxonMobil demanding all of the documents, plans, and preliminary research findings in the federal government’s possession concerning not only the seven-thousand-hole study Lindeberg had started, but other studies the Auke Bay scientists had undertaken about the possible toxic effects of oil on the environment.10

  Jeffrey Short published a newspaper essay that summer in which he described the findings of N.O.A.A.’s work examining the legacy of the Exxon Valdez spill: “Much more oil was found than anticipated—around 200 times more than claimed by Exxon’s contractor.” Sea otters and some bird species that forage on beaches where oil remained beneath the surface “have biochemical markers that indicate they are still exposed to oil. It appears that oil may still be a factor impeding their recovery, possibly through ingestion of oiled prey.”11

  The Auke Bay scientists knew that their findings would be provocative, but the response they drew this time went beyond any line of argument they had heard before. David S. Page, a professor at Bowdoin College in Maine and a scientist under contract with ExxonMobil, published a rejoinder that came close to accusing the Auke Bay scientists of faking their evidence.

  It was Page, as it turned out, who had overseen the effort to shadow Lindeberg around the sound during the summer. After inspecting the beaches studied, he wrote, “We saw no evidence that Short dug 7,000 pits. . . . Had thousands been dug, we would have located many more.” The pit sites he could find “were chosen subjectively” by the N.O.A.A. team, he argued; the government scientists had employed an approach that “exaggerates the extent of remaining residues. . . . It indicates a strong bias in Short’s study and raises questions about the scientific validity of its conclusions.” Overall, Page wrote, “Prince William Sound today is as healthy as it would have been if the spill hadn’t happened.”

  Page’s published accusations prompted an internal review at N.O.A.A. to determine whether Short and his colleagues had indeed committed fraud. “It’s against the law for civil servants to take the public’s money and make stuff up,” as Short put it later. Eventually, the investigators exonerated the Auke Bay team. Short hired lawyers and fired off cease-and-desist letters to Page and to the administration of Bowdoin College; he accused his adversary of defamation. Neither Page nor the college took any action in response.12

  David Page was an academic scientist who had been working on the biological effects of oil spills since the mid-1980s. After the Exxon Valdez accident, he received contracts from the oil corporation, as well as from other funders, such as the state of Maine. Over the years he had come to regard the government scientists at N.O.A.A. as rent seekers who perpetuated a narrative of persistent oil pollution in order to justify their professional funding and projects. “It’s like the Arabian Nights—if you run out of stories, you get your head cut off,” he said. “They kept doing research long after it would do any good.”13

  It was with Page’s collaboration that ExxonMobil began to deliver the Freedom of Information Act (F.O.I.A.) requests to the Auke Bay Laboratories at a rate sometimes as high as four per week. Whenever Short or Rice made a public presentation of their findings, “an Exxon lawyer, biologist or chemist would be in the audience,” and the corporate-affiliated scientists would sometimes stand up to make “an out-and-out attack on our work,” Rice recalled. At one conference in San Diego, Rice had heard enough; he “got up and told them I thought it was a classless act. People attending were shocked—it’s not something you normally see.”

  Pete Hagen, a biologist who arrived at Auke Bay as the program manager for Exxon Studies, a title that referred to N.O.A.A.’s research into the Valdez’s impact, found that his views about the scientists working for ExxonMobil hardened as time went on and as F.O.I.A. requests accumulated on his desk. “They may want to wear down government scientists,” he reflected. “Beyond harassment, we don’t know what Exxon’s motivation is.” His thinking about the oil corporation and its allies in the scientific community “has become more extreme,” he admitted. He felt that their willingness to bend data to serve the corporation’s legal and business aims was “not too dissimilar to what the tobacco industry went through, or the lead industry. . . . Sometimes you win by persistence.” For his part, Jeep Rice regarded ExxonMobil’s tactics as “legal, but just immoral.” Jeffrey Short resented ExxonMobil’s drive to “access data before we’d even published it, which put us in the position of giving data before we interpreted it—giving them, in theory, the chance to write up papers before we did.”

  For David Page, too, the arguments about science in Prince William Sound grew personal. He found the N.O.A.A. s
cientists’ responses to his criticisms of their research to be “shrill . . . I wasn’t accusing them of fraud. I was just saying my observations were at variance with what they were claiming.” In fact, his published essay did come close to implying that Short’s team had faked its hole digging, but after the initial, accusatory exchanges, Page did not return to that charge. He supported Exxon’s Freedom of Information Act demands because Jeffrey Short “rarely presents data” and “the only way” you can get detailed information underlying his studies is to make a formal legal request. “F.O.I.A. is not harassment; F.O.I.A. is to find out important information that government agencies aren’t willing to let become public,” Page said. As to Short’s concern that ExxonMobil was seeking raw data in order to advance arguments in public before the government scientists could, he said, “The record shows that our requests were made well after published reports were made in various venues, often several years or more after the studies were done.”14

  Science is innately uncertain. Its progress has been marked again and again by the defiance of settled wisdom by independent-minded mavericks, from Galileo Galilei to Charles Darwin. It can be difficult even for excellent scientists to distinguish between a revolutionary new insight and plain foolishness. Vested interests—governments, clergy, or private corporations—have long sought to control and manage the policy implications of scientific findings. Only in an environment of free debate can the best scientific facts and interpretations eventually win out. Even where new facts affecting the public welfare become well established, as had occurred with the research into global warming by 2001, it does not follow from scientific logic which public policy response is the best one; in the case of climate change, the economic costs of full and rapid remediation would be high. Governance and economics are not hard sciences, despite the contrary aspirations of some of their theorists and practitioners.

  Yet, the environment in which ExxonMobil and the Bush administration devised parallel approaches to managing science and public policy in the age of oil spills and global warming was influenced by several factors that Darwin would not have recognized. One was the prominence of lawyers and their win-for-the-client mind-sets. The tobacco industry’s near bankruptcy had demonstrated that not even talented lawyers could overcome terrible facts in a product liability matter. Yet that example had also shown how industry funding and purposeful, subtle campaigning could profitably delay a legal reckoning for a dangerous product through the manipulation of public opinion, government policy, and scientific discourse.

  The scientific facts about oil pollution and climate change that ExxonMobil and its political and intellectual allies in Washington had to manage as the Bush administration took office were nowhere near as daunting as those that confronted the tobacco industry when the dangers of smoking were publicly recognized in the early 1960s. By comparison, the public health effects from the burning of fossil fuels were often indirect. The American economy’s dependence upon oil and gas was not the product of some clever marketing campaign, as cigarette smoking arguably was, but was embedded in technological and industrial evolution.

  When regulators or lawsuits challenged ExxonMobil’s liability on environmental matters, the corporation turned fiercely combative—Irving’s internal protocols provided for rapid intervention by ExxonMobil’s law department, which spent large sums on the most talented and aggressive outside litigation firms. “They took a very hard line on the legal issues,” explained a member of the corporation’s board of directors. “It’s very much a take-no-prisoners culture.” From Washington to Houston to capitals worldwide, ExxonMobil executives internalized the corporation’s attitude toward lawsuits of all kinds: “We will not settle just to avoid a struggle; if we believe we are in the right, we will use our superior resources to fight and appeal for as long as possible, and when the case is over, your house may no longer be standing. Think twice before you take us on.” ExxonMobil’s spokespeople and lobbyists regularly expressed dismay that the scientific findings they presented about the Valdez cleanup, climate, chemical regulation, and other public policy issues were not accepted by journalists, judges, and politicians as fully credible.

  David Page knew that the government scientists thought of him as a corporate shill, and he felt insulted by that accusation. “It’s not about corporate America,” he said. “To compare Exxon to a tobacco company is totally outrageous. They are two very different things. I will tell you, my livelihood was teaching students chemistry and biochemistry. I didn’t need to work for Exxon or anybody else. If I thought for a minute that I was being asked to say something that wasn’t true or to hide information or act in [an] indefensible way at all, I would have taken a hike and not had any further relationship. I don’t hold my nose when I’m talking.”

  Jeffrey Short ultimately quit his government job in part because of the distractions caused by the corporation’s unrelenting Freedom of Information Act requests. “We’re all scientists—we didn’t sign up to do that,” he said.

  Mandy Lindeberg could think of only one positive aspect of her experience as an ExxonMobil adversary. Knowing that every field note she and her colleagues made would be scrutinized by corporate litigators and scientific consultants, she said, “forced us to be very good scientists.”15

  Six

  “E.G. Month!”

  Equatorial Guinea seemed like a place that Gabriel García Márquez had invented, a former American ambassador once remarked.1 A thumbprint on the west coast of Africa, the entire country consisted of an offshore island, where the capital of Malabo was situated beside a cliff-walled harbor, and a sliver of land on the continental shoreline. It had been one of Spain’s few African colonies. In 1968, Generalissimo Francisco Franco, Spain’s then-septuagenarian dictator, granted independence to a government led by Francisco Macías Nguema, an anticolonial politician. Macías turned out to be a depraved mass murderer. He imprisoned, tortured, and killed his opponents by the score. He closed schools, campaigned against intellectuals, and burned boats to prevent his people from fleeing his realm. His security guards executed 150 people in a sports stadium on Christmas Day while loudspeakers blared “Those Were the Days.” In Malabo, Macías maintained an active torture chamber in Black Beach prison. He increasingly walled himself away on the slice of mainland Africa where his Fang ethnic group predominately resided. He descended into paranoia and lashed out at anyone who challenged him. Roughly a third of Equatorial Guinea’s small population would die or manage to escape during his reign.2

  On August 30, 1971, Lannon Walker, a diplomat at the United States embassy in neighboring Cameroon, telephoned his colleague Len Shurtleff to report signs of trouble emanating from the nearby American embassy in Malabo. Walker reported that Al Erdos, the American chargé d’affaires in Malabo, might also be going insane.

  Erdos had been sending strange cables in recent weeks. Now he had come on the shortwave radio to report on some sort of Communist plot involving one of his American colleagues, whom he had tied up in a vault in the chancery. Walker asked Shurtleff to fly to Malabo to investigate. The diplomat arrived that evening by chartered aircraft. At the tiny embassy—little more than a rented house—Erdos, visibly distraught, pulled him aside. He announced, “I lost my cool. I killed Don Leahy.”

  He was referring to the embassy’s administrative officer. Inside the chancery Shurtleff found scattered papers and spattered blood. A woman’s scream called him to an interior room. There he found Mrs. Leahy kneeling over the body of her dead husband. He had been stabbed to death with a pair of embassy scissors.

  An autopsy showed that Leahy had semen in his trachea, suggesting that love or sex had been an issue between murderer and victim. At his subsequent trial in a Virginia federal court, Erdos entered an insanity defense; his lawyers blamed Equatorial Guinea’s menacing tropical dictatorship for having driven him mad. The jury convicted him of manslaughter.3

  The case established a tone in U.S.–Equatorial Guinean relations that would persi
st for years to come. The host government accused one of Erdos’s successors of sorcery and expelled him; the ambassador in question, John Bennett, had persistently raised concerns about the country’s human rights record. The United States shut its Malabo embassy, pleading budget constraints. Thereafter it serviced Equatorial Guinea by airplane from its embassy and consulate in Cameroon.

  Equatorial Guinea was perhaps the most politically toxic oil property Lee Raymond had acquired from Mobil. Given Exxon’s reserve replacement challenges, however, it was hard to be picky. Resource nationalism in the Middle East had driven all of the Western majors to Africa in search of bookable reserves. Exxon had had success on its own in Angola, but Raymond would mainly be dependent on Mobil’s legacy properties if he wanted to share in Africa’s emergence after 2000 as an increasingly important oil play. Some of the contracts available to Western oil companies in West Africa, such as in Nigeria, could be restrictive. Equatorial Guinea was a case where the upside was more attractive, financially—as it had to be, given that, on the world’s political risk charts, the country presented an extreme case of uncertainty. By 2001, ExxonMobil operated oil platforms about forty miles offshore, where workers on four-week rotations pumped steadily rising amounts of crude—more than 200,000 barrels per day and rising, or about 8 percent of ExxonMobil’s worldwide production of oil and gas liquids that year. Mobil had negotiated a contract with Malabo’s inexperienced government in which it secured the right to recoup its investment expenses from oil sales in the early years of production, paying Equatorial Guinea’s government an initial royalty of only about 10 percent. The principle that Mobil should be able to recover its costs early was typical of deals designed to protect international oil companies from political risk, but these specific terms were favorable. Now oil prices were rising, and the project looked likely to pay off big to both parties.4