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Texas Oil Industry Keeps Wary Eye On ISIS

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While the crisis in Iraq is half a world away, it’s impact can be felt here in the U.S.  The rapidly destabilizing region is a base for major Texas oil companies, some of whom have had to evacuate the increasingly hostile environment.  

The Islamic State of Iraq al-Sham, better known as ISIS has launched a string of attacks in northern Iraq, including an attack on an oil refinery.  The Texas Standard’s David Brown speaks with Don Stowers, Chief Editor of Oil & Gas Financial Journal in Houston about the situation and it’s impact on the U.S. fuel industry.

“[Oil companies are] already taking some preemptive measures.” Stowers says. "I'm not sure the intelligence is satisfactory, so everyone - just like you would in a hurricane approaching the Gulf Coast - you would start evacuating before you found out it was necessarily a category 5 storm."

Exxon Mobil has carried out a major evacuation. BP has evacuated 20% of it's staff. Schlumberger and Baker Hughes are reportedly taking a wait-and-see approach. Stowers says most of Iraq’s oil producing industry is located in the south of the country. U.S. operations there are mainly refineries, and may be better protected.

“It looks like the militias there are arming themselves and working with the government forces to try and repel ISIS from that area,” he says.

“The Iraqi government so far hasn’t put up much resistance," Stowers continues. "But ... it's been out of its comfort zone in the north, I think. As the ISIS militia moves south to the predominately Shiite areas, it looks to me that the Shiite militias will sort of bolster the army."

If ISIS were to reach the southern oil fields and refineries, Sowers says, the refineries "wouldn't be operating at full capacity if you evacuated a lot of the western workers, who are mostly there in a supervisory capacity. Oil exports would be reduced dramatically."

Iraq is the 12th largest oil producer in the world right now. A large portion of its oil is exported through Basra in the country's south. Europe would be the most affected by that, says Stowers. 

“At this time," Stowers says, "it's only a category 1 or maybe a category two [hurricane]. Things haven’t been really affected yet but the potential is there for it to build into a stronger storm.” 

An mp3 version of the story

Copyright 2014 KUT 90.5

David entered radio journalism thanks to a love of storytelling, an obsession with news, and a desire to keep his hair long and play in rock bands. An inveterate political junkie with a passion for pop culture and the romance of radio, David has reported from bases in Washington, London, Los Angeles, and Boston for Monitor Radio and for NPR, and has anchored in-depth public radio documentaries from India, Brazil, and points across the United States and Europe. He is, perhaps, known most widely for his work as host of public radio's Marketplace. Fulfilling a lifelong dream of moving to Texas full-time in 2005, Brown joined the staff of KUT, launching the award-winning cultural journalism unit "Texas Music Matters."
Emily Donahue is KUT’s news director. She has spent more than two decades in broadcast journalism and launched KUT’s news department in 2001. Previously, Emily was part of the Peabody-award winning team at Marketplace as producer of the Marketplace Morning Report. Since coming to KUT, Emily has overseen a doubling of the news staff and content, the accumulation of more than 50 local, national and international awards for journalistic excellence and served on several boards, including the Texas Associated Press Broadcasters and as a member of the 2011 Texas Association of Broadcasters Open Government Task Force. Emily lives in Austin and is currently working on her Master’s in Journalism from the University of Texas at Austin.
Alain Stephens heads up investigative reports for Texas Standard. A graduate of the University of North Texas and a veteran of two of the U.S. armed forces, Alain served both in the Coast Guard and the Air Force. His work has won accolades for exposing how the state pays those with disabilities below minimum wage, as well as the fast-tracking of juveniles to adult prisons. Contact Alain at astephens@kut.org, or (512) 232-6173.