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By Robert Rapier on Oct 7, 2010 with 2 responses

Oil Infrastructure and Terrorism – Part III

The secretary of Russia’s National Security Council is now warning that militants have joined forces with pirates to carry out attacks on key maritime oil transport hubs like the Strait of Hormuz and the Suez Canal. According to the EIA, the Strait of Hormuz “is the world’s most important oil chokepoint due to its daily oil flow of 16.5-17 million barrels (first half 2008E), which is roughly 40 percent of all seaborne traded oil (or 20 percent of oil traded worldwide).”

The following is the final segment of this week’s three-part series (Links to: Part I and Part II) on oil infrastructure and terrorism. Regularly scheduled programming will follow shortly.

The report was written by Donald J. Evans, a Senior Research Fellow at the International Strategic Studies Association, and was originally published in the Global Intelligence Report.

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Is Hydrocarbon Man the Next Terrorist Target? – Part III of III

Guest Essay by Dr. Donald J. Evans

(Links to: Part I; Part II)

Conclusions

Where does the evidence lead that might answer why terrorists do not attack oil pipelines in the Middle East? What is to be made of the silence? What conclusions may be drawn?

Conclusions are only as valid as information is available and reports of terrorist incidents are accurate. Corporations for any number of reasons are reluctant to report losses to the public. Governments may not want to report incidents, and if they do, they want to determine how incidents come across to the public. Incidents may be reported one way for domestic consumption and another for international listeners or readers. Middle East states may be much more concerned to have incidents attributed to transnational terrorists than to domestic dissidents. Middle East officials, like those of the West, know how to “wag the dog.”

Much of the literature assumes that all energy infrastructures are vulnerable to terrorist attack, not only oil. But “vulnerability” is an oil-slick word. Because no energy system is 100% safe from terrorist attacks, are such systems therefore vulnerable? Pipelines by their length alone make them appear vulnerable to terrorists, but pipelines under the right conditions may be the least vulnerable physical targets. What is needed is a definition of vulnerability that measures the notion at all segments and points in the system. Elements to be measured would include redundancies, alternative throughputs, interchangeable parts, numbers of repair crews, and armed protection of critical stations. Therefore, “total vulnerability” of a system is not as important as segmented vulnerability. Saying that an entire system, at least in the case of oil, is vulnerable is probably inappropriate, except in those rare instances where alternatives are nonexistent. Statements on the record about the vulnerability of Middle East oil facilities need to be examined carefully.

Another idea pervading the thinking on pipeline protection is that the system is vulnerable if there is not a continuous throughput of the product. The argument follows along these lines: The system that directs oil flowing through pipelines from wellhead to storage field to on-load shipping terminal to tanker to off-load terminal to storage tank to refinery to truck to the consumer is vulnerable unless the flow of oil is continuous, that is without interruption of any kind. This idea is supported by the otherwise fine writing of Lisa Maechling and Yonah Alexander who remark: “While the flow of oil from fields to tankers can be slowed down, it cannot be stopped without bringing to a halt the flow of oil from the wellhead.”

Granted, there may be segments where pipeline pressure and continuous flow are necessary, but accidents happen, full storage tanks may not be available, and other wells may be put on line only at great expense. Continuous flow and vulnerability are often joined in order to press the need for action, be it armed intervention or financial assistance. Alarms about this type of vulnerability are more appropriate, if at all, in the long-term.

There is no single answer to whether Hydrocarbon Man is the next terrorist target. Answers are a function of the point of view of the intelligence analyst, corporate or government official, terrorist leader, or other interested party. The literature reviewed, the evidence as it were, leads to the following conclusions as to what is of primary importance to the oil corporation and to the terrorist.

Corporate Protection

Oil companies must deal with multiple threats to the flow of oil. When the terrorist is the perceived threat, the primary concern is whether the flow of oil is protected from interruptions. The issues are those of safety and security to pipelines in the broadest sense of the word. Protection is the operative word in their war against terrorism, and it comes in many guises:

Superpower protection of Middle East oil flow is the most obvious protection available to states surrounding the Persian Gulf and the Caspian Sea.

The enormous wealth and influence of multinational oil companies allows actions to be taken that make oil pipelines less desirable targets of terrorists.

Oil companies and governments are able to augment armed forces with proxies—private security armies—to protect vulnerable oil targets.

Oil firms are able to reduce risks to investments from terrorism because insurance is available to fund the rapid replacement of destroyed or damaged pipelines.

Complexity of the oil network makes the petroleum infrastructure more secure from terrorist attack than other sectors of the world economy.

But the ultimate argument for protection against terrorist attacks on the Middle East oil structure reportedly came from a senior Western oil executive who said: “Terrorism? Who’s going to blow up their own pipeline?”

Terrorist Selection

Selection is the operative word for terrorists. At this point it would be worthwhile for a group of analysts to draft a scenario by selecting oil facilities and terrorist organizations and then go through the target acquisition process to determine which facilities would filter to the bottom as prime candidates for a terrorist attack. Such an exercise is of course beyond the scope of this paper and must be left to government agencies with the resources to carry off such an undertaking. The most that can be done is to review the materials presented and make judgments based on them. Consequently, factors in the target selection process lead to the following conclusions when viewed, in so far as possible, from the terrorist perspective:

The oil infrastructure of the Middle East with its various protective measures has made oil pipelines less attractive targets.

As oil targets and other potential targets make their ways through the terrorist target selection process, other targets emerge with more appeal.

The complexity of the oil infrastructure, while in many ways appealing as a target, removes oil pipelines from consideration.

The funding of terrorists’ activities by the oil-producing states effectively removes oil pipelines from initial consideration in the target selection process.

Both corporations/governments and terrorists have reasons to believe, as in the past, that oil pipelines will not experience long- or even short-term disruptions.

Corporations have the protective wherewithal to support their belief; terrorists have more important targets in sight. In battle, it is a mistake to underestimate the enemy. Constraints, capabilities, and conditions are constantly in flux. There is no one answer from open sources or silent caves surrounding Middle East oil kingdoms as to whether Hydrocarbon Man is the next terrorist target or not, but if an answer is required, it would be, “unlikely in the near future.”

All forms of vulnerability create various degrees of stress, fright and terror in the minds of employees, shareholders, and directors of the firms involved. The venue of the oil production business is permeated with a degree of danger and terror perhaps unknown to other companies. Do company related individuals think differently about risk, exposure, and vulnerability when faced with the organized and resourced cells of state sponsored terrorism? Or, is a terrorist incident an accident with a different name, and therefore it is business as usual? It’s a curious idea, this conducting the oil business as usual in a terrorist environment. It requires a look beyond the points already discussed.

A Strategic Framework

Pipelines are always vulnerable. The absence of a history of terrorism or lack of an acute terrorist threat does not make them any less vulnerable. They are always vulnerable to a terrorist attack, because terrorists have the ability to insert the element of surprise. The inability to calculate surprise results in costly overreaction by governments and corporations when taken by surprise.

In the course of explaining why terrorists have given Middle East oil pipelines “the silent treatment,” answers have touched upon a number of components: infrastructure, threats, vulnerabilities, protections, targeting, and analysis of risk. None of these topics by themselves explain the silence. What explanations have lacked up to this point is a broader strategic framework that would pull together and connect as many of the components as possible. Fortunately, such a framework exists in systems theory and was applied to an energy strategy study conducted in the early 1980s by the Rocky Mountain Institute for the US Department of Defense. Now available in a new 2001 edition on the Web, the study has many implications for protection of oil pipelines in the Middle East.

The crude oil throughput infrastructure is designed on the principle of efficiency. Petroleum stays in the ground until needed, because, “oil appreciates faster in the ground than it does in a Swiss bank.” It takes about three months for oil to get from the wellhead to the end user. Nearly two months of world oil use is in the pipeline during the three months. “The oil system is rather ‘tightly coupled’ without large reserves of storage to draw upon in an interruption. This money-saving (but vulnerability-increasing) practice is most striking in the case of refineries, which normally keep only a three to five day supply on hand and thus wither rapidly if the crude supply is interrupted.” It is not just refineries, but all components of the oil business are designed for efficiency: wellheads, drilling rigs, pipeline, storage tanks, tankers, offshore production platforms, plans, methods, and people. Oil components are currently designed for the kind of reliability that makes them efficient, but therefore vulnerable to terrorist attacks.

The most effective strategic principle in the terrorist arsenal is surprise, and to extend the metaphor, terrorists have surprise secreted in millions of barrels per day. Surprise is the unknown risk factor. This is why oil pipelines can never be 100 percent safe, but why they should be made as resilient as possible. Thus, it is the surprise principle vs. the efficiency principle. In using surprise the terrorist in asymmetrical warfare employs economy of force by necessity. Surprise is a force multiplier due to the inherent vulnerability of efficiently designed and maintained pipelines. The resilient properties sought in response to surprise are functions of causes inside and outside the system. The Lovins identified from bio- and eco-systems the resilient properties necessary for oil and gas systems. These properties are reduced to principles and applied to the problem of designing resilient energy systems. Thus, “The more resilient, slightly less ‘efficient’ strategy wins an even richer prize: minimizing unexpected and disastrous consequences which can arise when the causal structure of a real system turns out to be qualitatively different than expected.”

To compensate for the lack of inside design resiliency, private and government owned pipelines require a greater degree of external protection than would otherwise be necessary. The greater protection comes at a high cost, eg: in the form of foreign military forces, private armies, financial incentives, and insurance. To say that NATO, the Gulf Cooperation Council, and US provide protection to efficient oil system misses the point. Its seems reasonable that fewer armed forces would be required in the Middle East, if the oil infrastructure were designed with more resilient properties. Furthermore, one of the thirteen properties sought in resilient energy systems is that of limited demands on social stability. This property is particularly apropos to the presence of US forces in Saudi Arabia and to tensions between social classes in the country, for as one observer has noted:

“It should not be necessary to deploy force to protect (an energy technology. It) … should be able to survive and recover from periods of political breakdown, civil unrest, war and acts of terrorism. The system should be unlikely to become a target of protest; should enhance, not threaten social stability.”

Summary

It was George Bernard Shaw, British playwright and critic, who said: “Silence is the most perfect expression of scorn.” The deafening silence surrounding oil pipelines in the Middle East expresses the scorn of transnational terrorists who are currently strapped by target selection constraints, the need for financial assistance, and the manifold protection available to big oil corporations and Arab governments. The forbearance of terrorists is due to their greater open dislike and disrespect for modern Western nations whose civilians make richer targets. The armor of Hydrocarbon Man may protect him a little while longer against the chilling terror that lies behind the crescent smiles of the new jackals.

  1. By Optimist on October 7, 2010 at 8:27 pm

    Where does the evidence lead that might answer why terrorists do not attack oil pipelines in the Middle East? What is to be made of the silence? What conclusions may be drawn?

    I suggest reading Timothy Noah’s excellent piece, Why No More 9/11s. Personally I subscribe to the Terrorists-Are-Dumb Theory. Of course, they don’t necessarily remain that way.

    My theory is this: Success or otherwise in the GWOT (Global War on Terror) is determined by how you are perceived by the larger local population, most of whom are reasonable. If the perception is that you are fair, and strive to be fair, then the broader population would support your efforts to fight the extremists. Suddenly you are successful.

    However, if most of the local population perceive you as being unfair (or an invader, etc.), they tend to side with the extremists. Suddenly those bad guys have a lot of hiding places. They get a lot of support. Many offer their services. IQ levels of the recruits go up. Etc.

    Unfortunately, it’s the politics that determines success or failure. Do we have the backbone to follow through and do the right thing? The jury is still out. Iraq, while hardly a roaring success, suggests we might be able to. Afganistan, OTOH, suggests that we’re more interested in finding the exit…

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  2. By Benny BND Cole on October 8, 2010 at 2:02 pm

    This whole three-part series is questionable, and probably an effort to bolster a grab on federal taxes by our robust and ever-growing anti-terrorism industry.

    Oh, please, pirates are going stop the global oil industry. If ever Somali pirates posed a real threat, they could be blown out of the water in about one day. Only the West’s civility has stopped that from happening already.

    Also, people forget how quickly a temporary fix can be done. The US Army Corps of Engineers can erect a bridge in a day. It works, it is serviceable.

    Pipelines can be repaired quickly, if you are doing a quick and dirty job.

    In wartime, populations show incredible ability to perform, even under daily bombings. Pontoons are brought out at night and bridges emplaced, taken back by day. I can’t imagine that an ill-organized collection of psychopaths–terrorists–poses any real threat to Western civilization. They don’t.

    Now, homeowners and commercial real estate buyers who borrow too much money….they are wrecking us. I might add a couple stupid wars, and a fleet of gas-guzzlers.

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