Episode 28

I was so impressed by Sasha Baron Cohen’s recent take-down of Facebook.

In his acceptance speech for the ADL International Leadership Award, he said hate and violence are being facilitated by a handful of Internet companies that amount to the greatest propaganda machine in history.

He also said it’s time for regulation and legislation to curb the greed of these high-tech rubber barons: if you pay them, Facebook will run any political ad you want, even if it’s a lie.

And then Baron Cohen said that under this twisted logic, if Facebook were around in the 1930’s, they would have allowed Hitler to publish ads on his solution to the Jewish problem.

But there is another big bad thing that Big Tech are up to.

They are forging a lucrative huge partnership with Big Oil building a new carbon cloud that just might finish us off.

And today I am going to tell you all about that.

Welcome to Episode 28 of The Angry Clean Energy Guy with me, Assaad Razzouk

BIG OIL, BIG TECH AND THE BIG CARBON CLOUD

We already know that despite the global climate emergency we’re in, Big Oil are doubling down on fossil fuels. So the likes of Exxon and Shell and Total and Saudi Aramco are producing more fossil fuels than ever before, and production has never been higher.

They’re getting plenty of help from banks, and they’re getting plenty of help from governments around the world. That, too, we know.

But now, thanks to a remarkable article in Logic magazine by an anonymous Microsoft engineer, we’re learning that Big Tech, that’s Amazon, Google, Microsoft and others, are forging a lucrative global partnership with Big Oil with the sole purpose of increasing fossil fuel production.

They’re building a new carbon cloud that just might kill us all.

In a nutshell, with the help of tech companies like Microsoft, oil companies are using cutting edge technology to produce even more oil, faster and cheaper.

That collaboration between Big Tech and Big Oil might seem at the beginning counter-intuitive because, culturally, who could be further apart? You would think that tech companies are leaders in corporate sustainability, and that’s because they all try to outdo each other in their support for green initiatives. We keep hearing about how they want to be powered with 100% renewables and how they are investing in sustainability across their businesses.

However, this account from this anonymous Microsoft software engineer just basically explodes that narrative.

He is sent to Kazakhstan to work with Chevron and the Kazakh state oil company, Chevron’s partner, to improve its extraction output with machine learning techniques and big data and artificial intelligence. And it’s quite the astonishing story. So reading that story, I learned that in 2017, Chevron signed a seven year deal with Microsoft potentially worth hundreds of millions of dollars to establish Microsoft as its primary cloud provider.

And I want to just digress for a moment and talk about what is cloud computing.

Cloud computing is basically a way for companies to rent computer servers as opposed to buying them. It’s like choosing to rent a movie on iTunes for $3.99 instead of buying the DVD for $10.99. So a few years ago, a company would have to run its website from a server that it paid for and maintained itself. But using cloud services provided by Amazon, by Google, by Microsoft, the same company can now outsource its infrastructure needs to a cloud provider.

The market is dominated by Amazon, and that cloud business alone now makes up more than half of all of Amazon’s operating income. In 2014, Amazon’s cloud revenues were $4.6 billion. But in 2019, just five years later, those revenues are up nine times to $36 billion. So that’s cloud computing.

And oil companies like Chevron are the perfect customers for cloud providers because for years they’ve been generating enormous amounts of data about their oil wells. Chevron alone has thousands of oil wells around the world, and each well is covered with sensors. The sensors send data to Chevron servers or to the cloud, and generate more than 1,000 gigabytes of data per day. That’s enormous.

Currently, Chevron is only able to use a fraction of that data because of the scale of computation that’s required. You need a multitude of servers to perform the complex workloads to analyze that data, and as a result, computational needs are huge.

But they’re not always huge. When the analysis is complete, the computational needs go down, and these sharp fluctuations mean that companies like Chevron are not the best equipped to deal with all that data.

That’s where the public cloud comes in.

Oil companies can basically solve the computer challenge by turning to the cloud renting model so they can rent as many servers as they need whenever they need these and pay only for what they use.

But Big Tech doesn’t just give you the cloud. It also gives you analytical tools like artificial intelligence and machine learning to actually study that data.

Usually, the normal way that you can find oil and gas is by performing a seismic survey. So you send sound waves into the earth, and then you analyze the time it takes for those waves to reflect off of different geological features. But the data is volumetric and spans hundreds of kilometers at a minute granularity, and so the data collected from a single seismic survey can run over a 1,000,000 gigabytes. The output is a 3D geological map, if you can imagine that for a moment, and then geophysicists study that map to recommend the best locations to build wells, but they take months, sometimes, to interpret this map, and it’s a labor intensive process.

To make the process more efficient, computer vision technology can automatically segment different geological features to help the geophysicists understand the 3D data and identify where best to drill.

And isn’t that just perfect? Bringing the strength of Big Tech to advance a core priority of Big Oil, climate emergency be damned, and dig out more fossil fuels out of the ground while cutting costs?

So let me get back to that Microsoft engineer.

In recent years, Big Tech aggressively marketed the transformative potential of the public cloud to Big Oil.

In 2017 Microsoft signed the seven year contract with Chevron that I just described.

In 2018 Microsoft announced major partnerships with BP and Equinor.

In 2019 it signed a deal with Exxon that Exxon claims is the largest contract in cloud computing for the Big Oil industry.

Amazon is also on it. It just opened an office in Houston, the US oil and gas capital.

Google is also on it. It’s developed deep relationships in the industry and has Total, Anadarko Petroleum and Nine Energy as clients.

So whatever Big Tech are telling their friends at Big Oil, it’s working.

This Microsoft engineer was sent to Kazakhstan because of the multimillion dollar partnership between Microsoft and Chevron. They sent him specifically there to help the Tengiz oil field adopt their technology. That Tangiz oil field, by the way, with roughly 26 billion barrels of oil, is one of the largest oil and gas fields in the world, and he was sent there to help.

He was there to talk about artificial intelligence and machine learning with a Chevron team tasked with boosting daily oil production from 600,000 barrels to one million barrels.

I mean, these guys are living on their own planet, maximizing as best as they can oil and gas production without any regard for what’s going on around them across the world in terms of the climate emergency. And I mean zero regard.

And the story has wonderful and telling details like this. And I quote.

“The Chevron managers were mostly Americans and with one exception, all white men. They wore monochrome suits and polished leather shoes. I felt out of place wearing sneakers and an oversized bottom down. There was not a single Kazakhstani in the room.”

I’ll leave that to sit there for a while.

So what was that Microsoft engineer there to do? Basically, he was there, as I said, to help improve oil exploration by bringing machine learning and artificial intelligence to the drilling world. But the Chevron managers also wanted to talk about something else.

They said: We have a lot of workers in the oil fields. It would be nice to know where they are and what they are doing if they are doing anything at all.

And according to the Microsoft engineer, what the Chevron partners were most keen to discuss is basically how to better watch their workers.

There is 30,000 or 40,000 workers on site. Nearly all are low paid Kazakhstanis. They work on rotating shifts 12 hour days for two weeks at a time to keep the oil field running around the clock and what the Chevron managers wanted was to use artificial intelligence and machine learning to keep a closer eye on them, analyzing video streams from existing CCTV cameras to monitor the workers throughout the oil field and using data from GPS trackers to do everything from identifying suspicious driving activity to tracking how frequently they took bathroom breaks.

And apparently everyone in those meetings discussed the idea of building a workplace straight out of George Orwell’s 1984 novel with complete normalcy.

So what’s really going on in that story?

Big Tech have been investing billions in cloud computing infrastructure, and apparently they think that the only way they can recover this investment and survive is by capturing the IT spend of Big Oil. If this is true, that means that the fortunes of Big Tech are tied to Big Oil, and we can no longer consider these sectors or industries as being separate because Big Tech is doing everything it can with billions at stake to maintain and strengthen the revenues of the oil and gas industry.

I have to say I loved the boots on the ground accounting for how imperialistic the operation can be, with descriptions of how a room full of white foreign guys got together to decide how best to relieve Kazakhstan of its oil.

And the story is really the complete dystopian package because of the depth of worker surveillance that the anonymous Microsoft engineer flags.

Now, obviously, Big Tech is not responsible for Kazakhstan reliance on oil, and obviously we can’t blame Big Tech for the climate emergency. But it appears that Big Tech is actually certainly exacerbating both.

It’s exacerbating Kazakhstan’s reliance on oil, and it’s exacerbating the climate emergency through its partnerships with Big Oil because remember that climate change is a problem where the damage done by relatively few can dwarf the attempts to make it better by the many. By all of us. And Big Tech can empower both sides. But it’s now clear which side it’s really on, and that side is not your children or grandchildren. It’s the oil executives and their short term bonuses, which is clearly all they care about, and so that needs to change.

And what we need to change it is relatively simple.

You already know from my previous podcasts that the easiest way to starve Big Oil is to increase their cost of capital.

But in this particular case of partnerships under the radar between Big Tech and Big oil, what we need is we need to get to a place where cloud providers simply refused to host oil companies.

So it’s a bit like the divestment movement, which has certainly grown a lot due to social pressure and meant that institutional investors are selling oil, gas and coal stocks.

And this would work in the same way.

What I would love to see are NGOs, lots of them, focused on the goal of pressurizing Big Tech to simply refuse to host oil companies.

Simple, isn’t it?

HERO OF THE WEEK: Ursula von der Leyen

Thank you so much for listening this far. All that we have left are my Hero of the Week and my Villain of the Week.

Let’s start with the Hero of the Week because there was a big, good news climate story over the past two weeks.

The European Union, as most of you know, is the world’s third largest polluter today, after China and the United States. But a few days ago, the European Commission, the executive branch of the European Union, introduced the EU Green Deal, and that’s a major, major plan to make the European Union carbon neutral by 2050.

And so my Hero of the Week is European Commission President Ursula von der Leyen, because she delivered, just a few weeks after taking charge, what is probably the world’s most ambitious climate action plan, including a road map of more than 50 actions that Europe would take over the next few years to pull off its emission goal. And one of its first actions is the most impressive. It’s to create a European climate law by March of next year that expressly commits all member nations to be net zero by 2050.

And it’s hard to understate how important of a one-two punch are this EU Green Deal combined with what I talked about extensively in Episode 26 of the Angry Clean Energy Guy, which is the European Investment Bank, the largest multilateral bank in the world, declaring natural gas a stranded asset.

So what these two moves by Europe mean, is that it’s most certainly the beginning of the end of the age of oil – and not a second too soon.

VILLAIN OF THE WEEK: SCOTT MORRISON

Changing continents, my Villain of the Week is the prime minister of Australia, Scott Morrison.

Now the climate talks have just concluded in Madrid. It was COP 25, so the 25th time 200 nations get together for two weeks to try and negotiate a solution to our climate emergency.

Cop 25 was a big failure. Why? Principally because Australia, Brazil, Japan, Saudi Arabia and the United States stopped progress.

Its highlights were that it was sponsored by fossil fuels, that climate activists were thrown out, that there was police violence against peaceful climate activists and that COP 25 basically signed off on an enormous amount of new and needless carbon emissions.

But why is my Villain of the Week the prime minister of Australia specifically as opposed to the leaders of Brazil, Japan, Saudi Arabia or the United States?

That’s because, just as I speak, Australia is burning. Australia is suffering from wildfires that are highly unusual at this time of the year, with right now 400,000 hectares of mega-blazes spreading beyond containment lines, razing lots of houses near Sydney and bringing the hottest day on record for Australia.  But meanwhile, Prime Minister Morrison is on holiday in Hawaii, in an incredible dereliction of duty, frankly, having sent his climate change in void to Madrid to make sure that they derail the entire climate change talks and having succeeded at doing that.

So Prime Minister Scott Morrison, shame on you.

And with that, thank you so much for listening to this Episode 28 of the Angry Clean Energy Guy with me, Assaad Razzouk.

Happy Christmas and see you in 2020.