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November, 2004:

Don’t Let Big Oil Bully You, Hong Kong

Annelise Connell, SCMP – Thursday November 18 2004

As we choke on filthy air, behind the scenes, our government and one of Hong Kong’s oldest families are facing off against the largest oil company in the world, ExxonMobil, and certain large wasteful energy users who do not think that the ‘polluter pays’ principle should apply to them.

The financial plans of the two local power companies, China Light and Power (CLP) and Hong Kong Electric are on the desk of Stephen Ip Shu-kwan, Secretary for Economic Development and Labour. The Environmental Protection Department has been silenced by the simple bureaucratic expediency of not being asked its opinion about the proposals.

Meanwhile, on the board of CLP, representatives of the Kadoorie family who are trying hard to achieve some sustainable development in the market, stare into the face of ExxonMobil executives across the table. The oil company owns the majority 60 per cent stake in the Castle Peak power plant – one of the two largest coal power plants in China. As the rest of the world looks to renewable energy, ExxonMobil’s stated corporate policy is opposed to this. Instead, it favours the same key revenue generator as every oil company in the world – getting consumers to pay for the infrastructure and investment needed to extract, ship, store, burn and transmit electricity from fossil fuels.

In Hong Kong, we have put one of our key engines of the economy into the hands of a multinational corporation. If the corporation is, indeed, the best in the world, then that is a wise decision.

But we have lost our leverage to make it perform in a way that does not destroy the health of the people. ExxonMobil made us believe that it would make steady progress towards the use of cleaner-burning gas, and the company began by getting gas from a pipeline which runs to Hainan Island. But they gambled – and lost – regarding the amount of gas that was available. We have been told that instead of a 20-year supply, there is ‘only’ 10 years’ worth of gas. However, rather than absorbing the shortfall because of the high 15 per cent rate of return they receive from us, they have reduced the amount of gas they use in order to make it last 20 years, and have returned to burning more coal – and creating a lot more pollution.

Meanwhile, the Kadoorie family is trying to establish investment in sustainable development, such as through massive outlays in wind farms in the mainland. ExxonMobil’s global policy is preventing us from breaking free of the chains of coal, oil and gas.

ExxonMobil has been playing this game for too long. With the ‘scheme of control’ under which it operates due for renegotiation in three years, we will not sit by without challenging the company. It should make public its financial plans and justify its suspect position that investment is more important than conservation, especially since investment has failed to deliver, as in the case of the Hainan gas pipeline.

The people have had enough of the pollution. We will no longer allow our health and the health of our children to be held hostage by the world’s largest oil company.

Annelise Connell is vice-chairwoman of Clear the Air