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Showing posts with label OIL. Show all posts
Showing posts with label OIL. Show all posts

Wednesday, April 13, 2022

THE FUNDAMENTALIST CREED

 

began wondering, after reading “The Fundamentals; A Testimony to the Truth”, the seminal work of Christian fundamentalism, how such a document had come to exist. The very first sentence of the very first of the 90 essays sought to explain it all. “In 1909 God moved two Christian laymen to set aside a large sum of money for issuing twelve volumes that would set forth the fundamentals of the Christian faith…” Upon further investigation I discovered that the two anonymous Christian laymen were Lyman Stewart and his younger brother Milton. And Lyman's personal history may provide some insight into cognitive dissonance he fathered and funded.
Lyman Stewart (above) was the deeply religious eldest son of a tanner. He hated his father’s business and wanted to be a missionary. But, as Jesus before him, Lyman would need funds to support his ministry. Then, on the morning of 28 August, 1858, almost in Lyman’s backyard, the foreman of the Pennsylvania Oil Company spotted fresh oil standing in the 69 foot drill hole he had decided to abandon the night before. Within a few weeks this well, outside of Titusville, Pennsylvania  would be producing the unheard bounty of 20 barrels a day. Jonathan Watson, the man who had leased the site to Penn Oil, became the first oil millionaire. Lyman  saw the hand of God in this miracle of sudden wealth.
It was a risky business. The towers of Ancient Babylon may have been constructed in part with asphalt. But in 1859 there was no explanation of how petroleum, or “rock oil” was created, nor why it was found where it was. Even today three out of four oil fields are first located because of surface “seeps” of asphalt. And finding  oil beneath the ground remained a matter of pure luck and, if you asked Lyman Stewart, divine intervention.  Those whom God loved, found oil. 
On 5 December 1859,  Layman used his life savings of $125 (equivalent of $3,000 today) to buy an option on a section of land not far from Penn Oil’s big score. But Lyman’s lease proved to be a dry hole, and it took him until 1861 to save enough cash to finance a second try. This time Lyman hit oil, but over-production had by then driven the price down to ten cents a barrel, and Lyman and his partners lost their money and eventually, their lease. 
By now chemical analysis had determined that oil had once been living plants and animals. From this it was theorized that oil was never found in the rocks in which it had formed, the “source rock”.  Instead it flowed into a permeable “reservoir rock”, which was always found beneath a layer of impermeable “cap rock”. 
If there were no cap rock and the oil made it to the surface, it formed a seep. Geologists still had no idea how old oil was.  But connecting the work of Scottish geologist James Hutton with the "Origin of Species", published in 1859 by the English Naturalist Charles Darwin, gave a strong hint that it might be unimaginably old. But you didn't need to believe Darwin to find oil. You just needed to be lucky, or faithful.
In 1866, after serving in the Civil War, Lyman returned to the oil fields. He opened an office in Titusville, helping other wildcatters negotiate leases from local farmers. On some of the better looking leases, Lyman waved his fee in exchange for a share of any oil found. By 1868 he had made a small fortune and a reputation as a savvy oil man. By 1869 he was broke again. But he remained convinced that God would not let him fail. 
In 1877 Lymen teamed up with a roustabout from the Pennsylvania and California oil fields, named Wallace Hardison. Hardison had made enough money in California to fund Lyman for one more try. And Layman hit the black gold again. This time, when they were on top, the pair sold out to Rockefeller’s Standard Oil.  In 1883 the Stewart brothers and Hardison packed their bags and moved to California, to escape Rockefeller's growing monopoly.
The desperate search for oil drove capitalists to take a hard look at the pulverized rocks drawn up from both dry and successful holes. It was the only empirical evidence they had. They found these cores to be filled with the remains of microscopic Foraminifera. There are some 4,000 species of these single celled aquatic creatures in today’s oceans, from the surface to the bottom mud, from the Artic to the tropics. But the fossils of some 275,000 separate Foraminifera species were coming out of the drill holes.
Obviously the vast majority of these little creatures and plants had gone extinct. By studying which  extinct species had been found with the oil in past well cores, the capitalists could better judge their chances of finding oil in any new drilling hole. Eventually, oilmen would depend on former Foraminifera fossils to lead them toward the oil underground.
The move west did not change Lyman Stewart. He forbade his normally profane roustabouts from cursing on the drilling site, and earned his first California well the title of “Christian Hill”. Still, even with the Lyman’s piety, it took seven dry wells before Lyman and Harding produced their first gusher in Santa Clarita.  And by 1886 the Hadison and Stewart Oil Company was producing 15% of all the petroleum being pumped out of California. 
In 1890 they merged with three other local oil companies controlled by Thomas Bard, to form the Union Oil Company of California. Bard was named President of the new company, Lyman was named Vice President, and Hardison became the treasurer. The company’s headquarters was established in the pretty little town of Santa Paula, at the corner of Main and Ojai streets, surrounded by hundreds of nodding mechanical donkeys, pumping out profits for Layman and his partners. 
Success and wealth merely confirmed Lyman’s faith in his own righteousness. He had no doubt that God meant him to be wealthy and wanted him to expand his empire. Wallace Hardison was not so certain, and in 1892 he sold out. Then in 1894 Bard resigned after repeated fights with Lyman. Evidently, being pious did not make Lyman a congenial partner.  
But finally Lyman Stewart had reached the top of the mountain. He kept drilling, now following the extinct creatures to find new wells, to feed the growing demand for his product. 
He built pipelines and refineries. He built a fleet of tankers to carry his Unocal Oil up and down the West Coast. He opened a string of service stations, to sell his gasoline.  Company profits went from $10 million in 1900 to over $50 million in 1908. 
California was now producing almost 78 million barrels of oil a year.  The following year, Wallace Hardison died in Sun Valley, California, when his car was struck by a train, and Lyman Stewart's last opponent was welcomed into heaven.  It seemed that God was truly smiling upon his favored son.
Now at last Lyman Stewart had the fortune to fund his ministry. The brothers, Lyman and Milton,  endowed $300,000 for the publication of 12 volumes (90 essays) written in defense of what they believed were the five fundamental tenets of Christianity; the total absolute accuracy of the bible, the divinity of Jesus, his death for humanities’ sins, and his second coming, which was expected soon, perhaps in the lifetime of people then living. 
However there were a few other points made in the fundamentals, in particular a listing of the enemies of Christianity, as detailed later by Robert Wuthnow, of Princeton University. These enemies included “…Romanism (Catholicism), socialism, modern philosophy, atheism...Mormonism, spiritualism,...and Darwinism, all of which, in the Stewart's belief appeared to "undermine the Bible's authority.”  Formed originally as a response to "modernism", the foundations of Fundamentalism are primarily negative, insisting upon what they against, rather than what they seek to be.
The first target of the Fundamentalists was the growing acceptance of Charles Darwin’s theory of evolution through natural selection. William Riley, writing for the World Christian Fundamentals Association in 1922, declared “We increasingly realize that the whole menace in modernism exists in its having accepted Darwinism against Moses, and the evolutionary hypothesis against the inspired word of God." There are hundreds of teachers, Riley argued, who were pouring the poison of Darwinism into youthful minds where their evil teachings could "take root in the garden of the Lord.”
But seemingly in defiance of the Stewart's anti-Darwinism, by the 1920’s Union Oil geologists had realized that Foraminifera could be used to measure ancient ocean temperatures, and the amount of oxygen in extinct seas. Both of which impacted the formation of oil. And they were now basing multimillion dollar drilling decisions at individual well sites on the fossilized shells of now extinct microscopic creatures found in drilling cores. All of which Fundamentalism said was a lie. And yet those lies were making Lyman Stewart and the other oil investors richer by the day. 
But thanks to Layman Stewart and his brother's largess, millions in profits from this oil provided for the Los Angeles Mission, which has helped to feed and shelter tens of thousands of homeless and lost souls, and a nearby Fundamentalist Christian College, which explicitly teaches that those creatures used to find the wealth which built that college, had all died in a great flood, which had occurred, just six thousand years ago.
In 1923 Lyman Stewart died at the age of 83, very rich and still insisting to all who trusted him that the creatures which had made him wealthy were myths. But he kept the money.
  - 30 -

Tuesday, March 08, 2022

THE OIL CENTURY

 

I shall begin by stating a singular fact of chemistry, which is that burning one pound of coal produces one kilo-watt-hour of electricity, while burning the equivalent volume of oil produces 12.76 kilo-watt-hours.  Because of this, long before any Europeans knew where to find enough oil to burn, every admiral knew it was inevitable that future navies must be powered by oil. 
Then in 1901 a German professor named Kissling discovered a virtually unlimited “lake of petroleum” south of the Ottoman Turkish city of Kirkuk (above, upper center), and around Basra (above, lower right),  The professor had been searching in this god-forsaken dessert on orders from his boss, George von Siemens, managing director of Deutsche Bank.
Before he earned his “von”, George Siemens was just a promising Prussian civil servant. His skills in negotiating telegraph treaties had brought him the attention of Otto von Bismarck (above), the man who in 1871 had  made Wilhelm Ludwig the first Kaiser of Germany. Otto helped set up the Deutsche Bank and made George it's first director, because to Bismarck it seemed inevitable that Germany would be surrounded by enemies; France to the west, Russia to the east, and everywhere the British Navy. But the British addiction to capitalism made it was possible that money could wiggle through any British blockade.
George von Siemens (above) knew very little about banking, but he was convinced it was inevitable that railroads were going to build a new world order. So, much of the money that built the second and third American transcontinental railroads in the 1880's came from his Deutsche Bank, and George had a close up view of American capitalism in action. Americans, he wrote, “...are ruthless robbers...but they know how to think big.” So Director Siemens started looking for someplace to invest where the robbers thought smaller than he did.
To Abdul Hamid II (above), 34th Sultan, it was inevitable that the natural resources in the Ottoman Empire ought to make it one of the strongest powers in Europe. But successful rebellions in Hungary, Bulgaria and Albania, and graft and waste in his own government, had reduced Turkey to “The Sick man of Europe" - so deeply in debt that Abdul was forced by his creditors in London and Paris to turn over collection of the Empire's taxes (and its post office) to the “Ottoman Public Debt Administration”, run from banks in Paris and London. 
So when Deutsche Bank offered Abdul a hundred million dollars to build a railroad from Berlin to Bagdad (above),  Abdul eagerly accepted, even if George Siemens insisted it be built with “only German materials”, and give Deutsche Bank mineral rights for 20 miles on either side of the railroad tracks. 
And that's why Professor Kissling was tapping rocks in the dessert outside of Kirkurk (above) and in the marshes around Basra – to find some way of paying for the railroad. And it was Kissling's report, made public in 1905 to reassure British investors in Deutsche Bank, which started a barrel- chested big-thinker ego-maniac named Winston Churchill to start thinking about the not yet inevitable triumph of the British Empire.
Modern history remembers him as the British archetypal bulldog, but that came later. In turn-of-the-twentieth-century Britain Churchill was a more of a Newt Gingrich – a bombastic clown extravagant in his language and his life style, which he financed by writing only slightly embellished books and newspaper accounts of his own adventures. 
Then Winston went into politics, and in 1913 he was named First Lord of the Admiralty (above), civilian head of the British navy. While everybody else was worried about the coal fed German Grand fleet sailing up the Thames, Winston was convinced it was inevitable that the Berlin to Baghdad railroad would fuel the rise of a greater Germany powered by oil.
His Admirals told Churchill the British Navy would need a speed of 25 knots to out maneuver a larger German fleet. Such a speed was possible only with oil powered warships. But in 1913, the British Empire controlled less than 2% of the world's oil reserves. Churchill wrote to his government masters, “We must become the owners or at any rate the controllers....of at least a proportion of the oil which we require.” The decision was made that the Foreign Office and the Bank of England must acquire all the oil reserves that they could. But how?
By now George von Seimens was no longer manager of Deutsche Bank, having passed away in October of 1901. And Abdul Hamid was no longer Sultan, having been deposed by the Young Turks under Enver Pasha in 1909. 
And in 1908 there was incorporated a most unusual bank in Constantinople. It was called the National Bank of Turkey. The most visible member of the board of directors was an Ottoman Armenian-slash-British citizen, named Calouste Gulbenkian (above).  Of course the British Foreign Office insisted, the bank was "...not initiated or suggested by us..."But that was horse manure.
Half of the capital in the National Bank of Turkey was supplied by Deutsche Bank, which also put up  their mineral rights along the Berlin to Bagdad railroad. The other half was put up by a new investment fund called the Anglo-Persian Oil Company, in which the same Calouste Gulbenkian was a major stock holder.  In 1912  Anglo-Persian Oil stumbled upon more oil fields in Iran, and hints of even more in Saudi Arabia.
And the guy who drew up the paperwork for all of this was none other than the little Armenian Calouste Gulbenkian (above), who paid himself for his work by giving himself a 5% share of all the oil pumped out of the new oil fields, if any ever was. 
The entire region was on the cusp of great changes.  The Berlin to Baghdad railroad had yet to reach Baghdad. Nobody had yet pumped a drop of oil out of the ground, because there were no pipe lines or terminals to receive it.  And the German bankers had not yet noticed they were now junior partners in the oil business with the British government. And then the First World War broke out.  And for the next four years artillery replaced lawyers as the big guns in oil negotiations, and the inevitable became subject to change.
In 1915 the British army captured Basra. In 1917 they captured Bagdad. In 1918 they captured Kirkurk.  By 1919 the Kaiser was deposed. The Austro-Hungarian Empire was dissolved. Deutsche Bank was bankrupt. Turkey was flat broke again. 
At the peace conference in Paris, the victorious English and French sliced the oil fields off from the Ottoman Empire leaving behind Turkey, and two brand new countries built around oil fields - Syria under French control and Iraq controlled by England. Each new country had a figure head appointed as President. In Syria he was a Shite, while the majority of the population were Sunni Muslims. In Iraq the potentate was Sunni, while the majority of the people were Shite.  That kept the both leaders reliant on their colonial investors
British and French corporations now controlled most of the world's oil supply outside of the United States.  Turkish Petroleum Company became the Iraq Petroleum Company, and eventually became "British Petroleum.  And then, stepping back into the sun light of the new world peace,....
...who should suddenly show up but the Armenian/British lawyer, Calouste Gulbenkian. With his 1914 contracts still in his pocket, he insisted it was inevitable that he was going to be paid his 5% of all that oil now being pumped out of the ground..
After ten years of legal haggling, in July of 1928, the oil companies finally caved in. The “Red Line Agreement” (above) gave Calouste Gulbenkian  5% of all the oil pumped out from within that red circle - forever.  His heirs are still collecting it today.
He was “Mr. Five Percent”, maybe the richest man in the world.  When he died in 1955, his personal fortune was estimated at $840 million ($40 billion in today's money).
The value of all this oil was established during World War Two, with the battleships and tanks and aircraft of Britain and the United States awash in the black gold. In 1945 the inevitable became fact.
As the Petroleum Century drew to a close, British Petroleum was the largest oil company and the fourth largest and most profitable corporation in the world.  And then, a decade into the twenty-first century, at about a quarter to ten on the morning of 29 April, 2010, an oil rig 48 miles off the gulf coast of Louisiana, leased by B.P., exploded. 
Eleven workers were killed. But worse even than the loss of human life, before the well was capped 
almost 5 million barrels of toxic petroleum crude gushed into the Gulf of Mexico.....
... killing everything which ingested it.  B.P. has estimated its total cost for the clean up will be at least about $40 billion.  The actual final cost will likely be several times that amount. 

And from the moment the admirals decided future battleships must be powered by oil, this spill, and the millions of other spills larger and smaller, world wide, all became inevitable. It helps if you remember, it has only been a little over a century since oil became the energy source of the future. But in the future only change will be inevitable. 

- 30 - 

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