Former ExxonMobil guy – “nuclear is great stuff, but people are afraid”

My wife and I just spent a glorious weekend with some old friends who were entertaining a number of people I had never met at their lake house. As I too often do when socializing over adult beverages, I got engaged in a conversation about energy.

One of the participants stated that he thought that nuclear was absolutely the right way to go, but then followed that statement with the assertion that nuclear’s main problem is that people are afraid of it. That gave me an opening to ask what is becoming one of my favorite energy conversation sustaining questions. I asked, “Why do you think they are so afraid?”

His answer was interesting – “Because nuclear energy is dark and mysterious and they do not understand it.”

My response was to provide a brief overview of my theory that the fear really exists because it has been carefully taught. I shared my own complete fascination with the fact that my 9,000 ton submarine operated inside a sealed environment for about 14 years on a quantity of fuel that weighed just a little bit more than I do. I did not have my simulated fuel pellet with me, but I held up my thumb and index finger an appropriate distance apart and told him how strong I felt when I held up a little pellet and explained that it contained as much energy as a ton of coal or 17,000 cubic feet of natural gas.

He agreed that he had never heard those kinds of comparisons and that they might help people overcome fear by replacing that response with utter fascination at nuclear energy’s almost magical qualities.

I concluded my short contribution to the conversation with my strengthening theory that oil&gas companies have helped to spread and reinforce existing fears of nuclear as a means to sell more of their products – mainly natural gas, but also oil in some natural nuclear markets like ocean going ships.

I pointed out just how much clean natural gas advertising there was during the post Fukushima media hype fest. I even mentioned the Chiba LNG facility that burned for 10 days – and how the only time I saw any of the dramatic footage from that fire on network television was as background video while the talking heads were discussing the activities at the nuclear plant.

Then I found out that I was talking with a retired ExxonMobil employee. He adamantly resisted the notion that his former employer would ever do such a thing as to teach people to be afraid of nuclear energy.

I then proceeded to ask what he thought his company would do if they found a weakness in any competitor. Would they hold back or would they invest time and money to take advantage of the opportunity to sell more of their product?

He thought for a moment and then nodded his head, saying “Of course we would take the opportunity to tell people that we have a good product that is available for anyone who wants to avoid whatever issue the competition is having. That’s just good business.”

We then began talking about how ExxonMobil keeps telling its shareholders and stakeholders that it is working as hard as it can to find new sources of energy and that all energy sources will be needed to meet future demands. I kind of ended the conversation that evening by asking, “If that is true, then why is ExxonMobil planning to invest zero dollars out of its proposed $37 BILLION dollar 2012 capital budget in nuclear energy.”

During the rest of the weekend, we occasionally circled back to the energy topic and discussed how capital intensive liquified natural gas development projects can be. We talked about the importance for project profitability of having a stable or growing customer base that is willing to pay a slight premium price for reliable supplies. I asked how it would affect an LNG developer/investor if the customer decided to build or operate nuclear power plants instead. That question did not get much of an answer – other than a chin rub and a thoughtful expression.

It is obvious to me that all LNG suppliers have strong financial motives to spread as much fear as possible about nuclear energy. Forcing operable plants to stop operating often provides them an immediate increase in both sales volume and sales price. Discouraging new plant construction enables a far better chance of executing long term contracts at a favorable price (for the supplier) that lock customers into their product. Those contracts provide the bankable revenue streams that make the projects look good on spreadsheets. Supporting efforts to reinforce fears about atomic energy is just “good business” for them.

You are welcome to try to prove my theory wrong by describing a single instance in the past 10 years of a major oil and gas company investing a substantial quantity of money into nuclear energy as a future source that can help them meet customer demand.

About Rod Adams

34 Responses to “Former ExxonMobil guy – “nuclear is great stuff, but people are afraid””

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  1. Pete51 says:

    I have been reading your blog for some time now, and I first disagreed about the fossil fuel industry wanting to spread FUD about nuclear power. However, over the years, I have come around to your position. It is quite obvious that companies like Chevron and BP like to tout their involvement in wind and solar not only to boost their public relations images, but also because they know wind and solar don’t work very well. The intermittent nature of these energy sources forces power companies to install quick-responding natural gas turbines as a back up. You showed Robert Kennedy Jr saying exactly that. Wind and solar farms guarantee a market for natural gas.

    Regarding your challenge of finding a fossil fuel company supporting nuclear energy, the closest I can find is Royal Dutch Shell investigating the use of nuclear in Canada’s oil sand fields.

    http://nextbigfuture.com/2007/05/canada-nuclear-oilsands-update.html

    I believe France’s Total S.A. has also looked into this.

    • DV82XL says:

      That has to be the best example of left-handed support ever.

      It is also the the ultimate Green nightmare.

    • Andy Dawson says:

      Back in the 1980s, there was some speculation in the British nuclear about possible sales of an advanced Magnox plant and/or AGR derivative as a source of process heat for various Alberta tar sands projects – the idea being that these could be used for direct supply of heat rather than accept the losses in electric conversion.

      http://bit.ly/naS57t Note: Long link shortened by blog host

      The idea died the death, as at the time there was no way that the forseeable oil price would have sustained the investment necessary.

    • Brian R Catt says:

      Its not just that alternatives as defined are variable and unpredictable, saving the predictability of tidal lunar power.

      Its that they are VERY WEAK and hence totally inadequate to power developed economies.

      Because they are weak you need huge networks of collectors, which are monstrously expensive and intrusive, and still won’t deliver the energy required to power a developed economy if they covered every square mile of a country and could get good wind (20% of rated output). Only intense fossil can deliver the level of power a developed economy requires easilly, controllably and cheap to distribute on an affordable grid, and much more intense nuclear when fossil has gone.

      At which point the massively expensive hugely (x4 ish) subsidised alternative future and its massive infrastructure becomes expensively obsolete without fossil backup to mask its weakness and variability. Nuclear needs no emissions offset.

      Wind power was created to reduce a 20th century acid rain emissions offset problem in Germany when cold war anti nuclear ideology made developing more nuclear difficult, wind power is a 20th Century solution to fossil emissions reduction working in symbiosis with fossil plant. It is utterly inadequate to power our economy at the end of fossil. Subsiding the wind, solar radiation or the tide does not make it any stronger or less expensive to harvest. Subsidise the wind and reap the whirlwind of ignorance.

  2. Daniel says:

    Ron,

    I hate to prove you wrong, but TOTAL (the french oil and gas conglomerate) is invested in nuclear. But it is the exception I grant you that.

    • Rod Adams says:

      Daniel – Thank you for taking my challenge and providing an example.

      Do you have any insight to share about the scale of the involvement compared to Total’s overall capital budget?

      Is the investment substantial or is it window dressing. Does it show a recognition that nuclear can play a useful role in meeting energy demands and that any energy company with a vision should be developing serious nuclear experience?

      • Andy Dawson says:

        Sorry, just had another thought. This, surely is natural SMR territory? Especially if there’s an element of mobility.

      • DV82XL says:

        There has been talk of nuclear at the Alberta tar sands forever. AECL tabled a plan for a twenty reactor fleet back in the Seventies, and several others have taken a crack at similar schemes which have all come to naught. The last serious attempt was made by Shell in ’08, but it ran into trouble and has been shelved.

        The issues are manifold. To start off with no foreign reactor company will get approval in Canada while CANDUs are not approved in the other country. Thus the U.S., British and French are out of the running. As well there is little public support for the idea with the public in Alberta, and First Nations have given notice that nuclear was not part of the land settlement deals, and have made it clear that they will demand that these be renegotiated, something no one wants to start on the other side of the table. Finally there is the cost, which under the current regulatory environment, will be very high and a great deal more expensive than Artic gas which is the alternative.

        In other words don’t hold your breath.

        • Bruce Behrhorst says:

          Exactly, provincially Alberta is conservative party (gov’t party) territory in perpetuity it’s OIL-HOCKEY-GRAIN politics.
          Unfortunately, for Canada wide politics it does not bode well for matriculating highly educated young canadians or high end manufacturing value added economy. Canada is trending toward low end temp jobs for export product. This is evident in the gov’t plan to cast out the AECL-CANDU to the winds of international markets.
          Besides AECL is a one-trick-pony there is no Canadian Small Reactor preference architecture or design.
          Not even for badly needed icebreaker propulsion.
          Canada is in serious denial on future canadian made SMR techology.

        • Bruce Behrhorst says:

          @DV82XL

          I think the most impact between Hydrocarbon and nuclear even in canada is nuclear has a multi-use aspect and returns of Desalination- District Heating-fuels production-electrical power production far out weighs a Hydro system where fuel consumption and price are volatile if fossil fuel is (subsidized) used domestically rather than for (high margin) export. Not to mention the costs of enviro impact footprints with regard to hydrocarbon manufacturing in such categories as:
          -Air
          -Land
          -Water/water table impact/water useage
          -Climate change
          -Carbon dioxide sequestration
          -pollutant release of isotope burning coal
          -Aquatic life deformities
          -Public health impacts
          Past pollution: Exxon Spill Valdez Alaska, Athabasca oil sands mining in Alberta, Off shore well explosion Lousiana State Coastline in N. America.

          Compare nuclear pollution event in N.America
          3 mile island no radiation release NRC license extended from April 2014 until 2034. Still generating electrical power.

        • katana0182 says:

          >Besides AECL is a one-trick-pony there is no Canadian Small Reactor preference architecture or design.

          Actually, I think AECL at one point back in the 80s(?) marketed a small modular reactor for district heating called the SLOWPOKE which was a variant of their standard research reactor.

        • DV82XL says:

          The design was called SLOWPOKE III but it never found a market. SLOWPOKEs were unique at the time as the only reactors licensed for unattended operation.

          The SLOWPOKE program collapsed when the Chinese, who had bought a few, started marketing a knock-off called the Miniature Neutron Source Reactor (MNSR), killing international sales for AECL.

          During the mid-1980s Canada briefly considered converting its Oberon class submarines to nuclear power using a SLOWPOKE nuclear reactor to continuously recharge the ship’s batteries during submerged operations. A good deal of work had been done on potential marine applications of the reactor at Royal Military College of Canada.

      • Daniel says:

        @ Rod

        I’ve seen a lot of TOTAL press releases over the years regarding nuclear and I noticed this as early as year 2000 when listening to TOTAL’S CEO year end results presentation. He sounded sincere about nuclear.

        However, scanning their financial statements and related notes, I got no hits on nuclear. The information regarding their nuclear commitment is too hard to dig out.

        You are right, lip service.

        • Andy Dawson says:

          It was a bit more than that – Total was (I think) part of the consortium bidding for the contract in Abu Dhabi – which strategically would make sense for Total, as it’s a geography in which its very active, and where it has a strong engineering reputation.

          Realistically, how would you expect an oil and gas player to enter the nuclear market? They’d obviously not be in the reactor design and manufacture space (short of them buying an existing business). They might, I suppose, position themselves as construction project managers, but there’s no shortage of experience players in that space (Bechtel, Fluor etc.) They’re not really in a place to become operators – short of buying in experience from an existing operating firm like EDF, KEPCO or so on.

          You’ve got to take it back to ideas of competitive advantage and strategy. They’ve no particular value to add in this area, no established technological or corporate kowledge, and so on.

          The only real role you’d expect them to play might be in financing a project – like a bank.

  3. gallopingcamel says:

    In 2002 I ran for the district 23 seat in the North Carolina senate.
    http://morcombe.net/Senate/index.htm

    One of my motivations was to unseat the incumbent, Eleanor Kinnaird who is an anti-nuclear hysteric.

    Ellie used to be my neighbor and the mayor of Carrboro, North Carolina. She is a very caring, likable person but she is terrified of nuclear power. She did everything she could to prevent the Shearon Harris nuclear plant from using its third storage pool for spent fuel rods.

    She was the most vocal opponent of the low level nuclear waste facility that North Carolina had committed to build. She was the single loudest voice advocating that North Carolina renege on its nuclear commitments.

    The consequences were additional costs of over $300 million and increased radiation exposure for North Carolina citizens.

    In 2011 Ellie is still the incumbent in NC district 23 and I am still trying to increase her understanding of nuclear issues with the help of my ex-colleagues in the Duke university physics department.

  4. Bruce Behrhorst says:

    I was thinking of the same idea the Co-Generation of fuels with nuclear power. This is the synergistic production of fossil fuels & nuclear energy. Named ‘Steam Methane Reforming’ SMR process or electrolysis for H2 fuels besides most other fossil fuels all manufactured with nuclear power. Only Russia and Japan have worked with these systems so far with success. The problem with N.America is energy (OIL) manufactures are fanatical and insulated in protectionist mode 24/7. Reminds me of the movie “There Will Be Blood”

  5. Wayne SW says:

    Well, if Rod Adams is right and this is the way the game is played, it seems to me the nuclear industry has the following choices: 1) quit, 2) continue to be a punching bag for the opponents, or 3) fight back. NEI is the industry representative. Companies support NEI. Perhaps they should up their financial support to allow NEI to produce and air positive ads countering the negativity.

    This has been a historical problem with the nuclear business. We tend to sit back on our knowledge of the beneficial aspects of the technology and assume the public will automatically see those as clearly as we do. We think the public is smart enough to see through the lies and scams of the anti-nuke kooks. Well, the average person isn’t. Unless they are presented with the information in an easy to understand way, they aren’t going to get it. For some reason, the nuclear business has either consciously foregone the need to take an active role in promoting itself, or has done a poor job of it. Either way, misconceptions based on lies and misinformation continue to grow, becoming more difficult to correct as time passes.

    • Brian says:

      Wayne,

      Only problem with NEI is that the companies that support them are in the business of selling fossil fuel. Fact is, there is really no true nuclear industry in the US, only a fossil industry with nuclear holdings.

      • Wayne SW says:

        Whatever. If they are interested in protecting that part of their business, they should be doing something to extoll its virtues. If they don’t want it, then maybe they should spin off those holdings into independent companies. Is Westinghouse still in the nuclear business? Are they dominated by a fossil energy parent?

        • Rod Adams says:

          Wayne – what makes you think that a fossil focused company would want to compete against a nuclear focused company that used to be a subsidiary.

        • Brian says:

          Wayne – My feeling is they want to milk as much money out of existing reactors for as long as possible. They are safe, surefire investments. New reactors, on the other hand, have the perception of being very risky investments. See Shorham for the prime example. Once those existing reactors are too costly to keep going, I suspect the US commercial industry is content on letting their nuclear division wither away.

        • Wayne SW says:

          If I were them I would either liquidate their nuclear component or sell it and then go about my business of dominating the fossil energy business. If they hold onto it as a hedge then I don’t think they’d be smart to try to destroy the nuclear business. So I’m having trouble reconciling the various viewpoints here. If the fossil guys are out to get us yet they own us, why don’t they just kill us (liquidate) and be done with it? If they don’t really want us but don’t want to kill us outright then spin us off and make a few bucks on the sale, then kill us later (or not). If they hold onto us then they must think there is some value there, so it makes no sense to kill us while we are still part of them.

        • Brian says:

          Wayne,

          You are missing the distinction between existing nuclear and new nuclear. The former is a cash cow by de facto existence from a different era; it makes no sense to sell or immediately decommission it, but rather let it quietly generate hefty profits until it can’t anymore rather than let that lucrative revenue stream go to someone else. The key is they have no interest in *NEW* nuclear projects because building fossil is so much easier.

        • Daniel says:

          And if maintained properly, a nuclear plant can last close to 100 years.

          There has to be some advantages to the overdesign that is built in those suckers ….

        • Wayne SW says:

          Brian, I understand your point, I am just trying to reconcile what appears to be conflicting information in the thread. Rod Adams takes the position that the fossil industry is out to get us, new reactors or old, they want us gone to increase their market share. Your point offered earlier as a counter to my suggestion that NEI be involved in pushing positive message to nuclear is that they can’t because nuclear is still owned, at least in part, by companies that have substantial interest in the fossil energy industry. You imply that means they may not like us all that much but they’d rather have us go away quietly rather than trash us all at once. I’m trying to sift through these possibilities and see which makes sense. I can see things that support some of both views, but in other ways they seem in conflict.

    • Bruce Behrhorst says:

      @Wayne SW
      You assume that energy policy is holistic sane and efficient in N. American. Reality is it’s confused single sector gov’t favoritism with a public duped with agenda driven misinformation into thinking it’s the best in the world. This is not the case in Asia-Pacific and the developing world. One need only look at the state of the global economic transition presently to see who will have the better energy policy.

  6. Michael R. Himes says:

    Dark and Mysterious Energy is involved in the production of cavitation steam. Fission nuclear, on the other hand, is “Old Hat”. If it were only a mater of understanding by the public, nuclear fission would still have a tough time. The fact remains, the control of the technology is not driven by public opinion but by Wall Street.

    In nature cavitation steam draws from dark energy. In the nuclear process in the stars fission nuclear and the production of dark energy are related. A balance of the two might be a healthy imitation of nature here.

    I have provided Rod with a long pdf file on the subject if he cares to expand on that topic

  7. Ed F says:

    What, you’re shocked that fossil fuel companies are jumping in to take advantage of a market opening? I didn’t see ExxonMobil, et. al putting out commercials directly panning nuclear as being dangerous — they didn’t have to.

    The nuclear industry’s biggest problem may be the woefully inadequate level of even basic scientific knowledge among America’s citizenry. It only takes a persistent, active scare campaign by the usual line-up of environmental groups, Ed Markey, etc., to generate a backlash against nuclear — that and the still sky-high upfront costs of building new nuclear (a good chunk of which seems to derive from a regulatory response to the environmental groups, Ed Markey, etc.). The oil and gas people don’t have to work as hard as you seem to suspect them of doing to thrive in that kind of environment.

    • Rod Adams says:

      Ed – did you know that out of 435 congressional districts, only one contains an LNG terminal that has been in operation almost exactly as long as Markey has been the leading antinuclear member of Congress.

      Can you guess which district that might be?

      Coincidence?

      • Ed F says:

        You’re right Rod, but Cove Point wasn’t that far behind, and as far as I’ve heard the Maryland delegation isn’t anti-nuclear, or at least rabidly so.

        Overall, I’m not sure that’s where Markey’s animus comes from — or Cuomo’s, or Shumlin’s. These guys seem to despise nuclear for it’s own sake, not (necessarily) because they’ve been bought off.

        • Rod Adams says:

          The big difference between Everrett and Cove Point is that Everrett has been in continuous operation and has captured 20% of a growing New England market that has been one of the more successful regions for shutting down nuclear plants.

          Cove Point was virtually mothballed for at least a decade and no local nuclear plants were ever shut down.

          IMHO – there have been some strategic political investments made that have helped make the Everrett terminal successful.

        • Rod Adams says:

          Compare the history of Cove Point

          http://www.dom.com/business/gas-transmission/cove-point/history-of-cove-point.jsp

          (no LNG shipments at all in period from 1980-2003)

          To the history of the Everrett LNG terminal

          http://www.suezenergyna.com/ourcompanies/lngna-domac.shtml

          (50% of US LNG market for 30 years, more than 1000 LNG shipments received since 1971)

          The antinuclear activism difference between MA and MD is also an interesting contrast.

          Again, the question is – “Coincidence?” I think not.

  8. Martin says:

    TOTAL of France is an example of a big oil company with a clear view of the future need of nuclear Power.
    The have openly talked since at least 5 years about Peak Oil. They say that they are not an oil company but an energy company.

    You can find on their website
    http://www.total.com/en/nos-enjeux-200977.html
    the pdf “At a glance” where you can find their actual involment in nuclear power on page 8.
    “I n n u c l e a r p owe r, Tot a l wi l l
    acquire an 8.33% stake in the second European Pressurized Reactor
    (EPR™) project, to be built in Penly,
    France. We are committed to
    nuclear power in the long term, as
    we continue to acquire the skills
    and expertise necessary to help
    develop nuclear energy in a safe,
    environmentally responsible way.”

    It seems that according to wikipedia they own 1 % of Areva. They wanted more some time ago but there has been some resitance in France against that.

    Christophe de Margerie, Chairman and CEO has always declared in public that nuclear power is needed in the future and is quite sceptic about Wind and Solar.
    http://www.wat.tv/video/christophe-margerie-total-3b9wf_2exyh_.html

    it’s in french and I hope you are permitted to watch it outside of France

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