~;CONTRIBUTORS ,TO THIS ISSU~(,....\i'..,.

ALUN ANDERSON is a former editor-in-chief of New Scientist

PHILIP BALL's most recent book isThe Devil's Doctor (Heinemann)

PAUL BARKER's Arts in Society has beenreissued by Five Leaves Publications

contentsIssue one hundred and thirty-one February 2007

DEREK BROWER is a writer on energygeopolitics

MARK COUSINS is the author ofThe Story cif Film (Pavilion Books)JASON COWLEY is a senior editor atthe Observer

JAMES CRABTREE was a senior policyadviser at the New Democrat Network

IAN CRAWFORD is a lecturer inplanetary science at Birkbeck College

RICHARD DOWDEN is director of theRoyal African Society

ROBERT DRUMMOND is a psychiatrist

CHARLOTTE EAGAR writes for theEvening Standard

DAVID EDGERTON is a professor atImperial College

FRANCIS FUKUYAMA is the author ofAfter the Neocons (Profile)

TIMOTHY GARTON ASH is the author ofFree World (Penguin)

DEAN GODSON is research director ofthe think tank Policy Exchange

SUSAN GREENBERG is a senior lecturerat Roehampton University

DAVID HERMAN is a television producer

CHRISTOPHER HIRD is joint managingdirector of Fulcrum Productions

NIBRAS KAZIMI is a visiting fellow atthe Hudson Institute, 'Washington DC

ETGAR KERET's book Missing Kissinger(Chatto & Windus) is out in March

TIM KING is a writer living in France

BEN LEWIS presents BBC'!>'sArt Safari

ALEXANDER L1NKLATER is associateeditor of Prospect

MATTHEW LOCKWOOD is a seniorresearch fellow at the IPPR

KAMRAN NAZEER is the author of Sendin the Idiots (Bloomsbury)

JONATHAN REE is a freelance historianand philosopher

WILLIAM SKIDELSKY is deputy editorof Prospect

IAN STEWART is a professor ofmathematics at Warwick University

4 PROSPECT February 2007

OPINIONS12 Rise of the gripe siteDEREK BROWER

How two men and a website humbledone of the oil industry giants.

14 Being FrankDEAN GODSON

Frank Johnson and the class system.

14 Swords to spaceshipsIAN CRAWFORD

A plan for the arms industry.

15 Slow journalismSUSAN GREENBERG

We need to value the literature of fact.

16 Slower technologyDAVID EDGERTON

Technology means corrugated ironand wood as well as nanoengineering.

INTERVIEW20 Michael RawlinsALUN ANDERSON

The chairman of Nice on theHerceptin row, how Nice calculatesthe value of a human life and what'swrong with the drugs industry

COVER STORY26Identity and migrationFRANCIS FUKUYAMAModern liberal societies haveweak collective identities.Postmodern elites, especially inEurope, feel that they haveevolved beyond identities definedby religion and nation. But if oursocieties cannot assert positiveliberal values, they may bechallenged by migrants who aremore sure of who they are.

ESSAYS32 The library of GoogleJONATHAN REE

Is Google Book Search an advance forscholarship or a victory for Anglo-Saxon bias and trivialisation?

36 Europe's true storiesTIMOTHY GARTON ASH

The EU urgently needs to give anew account of itself. How about atrue and self-critical story wovenaround six goals?

PORTRAIT42 Barack ObamaJAMES CRABTREE

Barack Obama's ability to articulate ahopeful version of the American dreamhas made him a political star. But isthe US ready for a black president?

SPECIAL REPORT48 A rough guide to carbon tradingMATTHEW LOCKWOOD

Are carbon trading schemes the bestway to tackle climate change?Trading is central to meeting Kyototargets, but questions remain about it.

• •opInIonsRISE OF THEGRIPE SITE

BY DEREK BROWER

How two men and a websitein Colchester humbled one cif

the oil industry giants

ITIS NOT the kind of place youwould expect to find at the centreof a global energy war. John Dono-van's office is in a modest house in asuburb of Colchester. No electronicmaps of Europe adorn his walls, asthey do the walls of Gazprom'sMoscow control room. And nor arethere any butlers bringing cups of teaand expensive biscuits, as you find atShell's head office on the Thames.There is just Donovan's 89-year-oldfather, Alfred, in the room next door.

But it is the home of www.royal-dutchshellplc.com, a website which canclaim to have cost Shell billions of dol-lars-and helped Vladimir Putin scoreanother victory over western energyinterests. This is how.

At the end of December, the Krem-lin's politically driven campaign to wincontrol of a liquefied natural gas pro-ject on Sakhalin island came to its pre-dictable climax. The deal signed inMoscow between Shell and Gazpromsaw the Russian company take 50 percent plus one share of Sakhalin Energy,the consortium developing the project.

It was an offer that Shell and its twoJapanese partners on Sakhalin couldnot refuse. The project, on a remoteisland notorious for its harsh winters,is one of the largest ever attempted.Sakhalin Energy will produce 9.6mtonnes per year ofliquefied natural gasand 180,000 barrels per day of oil whenit comes on stream in 2008.

But Sakhalin ran into serious prob-lems. The most important was its esca-

Derek Brower is the seniorcorrespondent of Petroleum Economist

12 PROSPECT February2007

lating costs. Last year, Shell reportedthat the price of the project had dou-bled to $20bn. Insiders tell me that thefigure is now closer to $26bn.

That would not be such a big prob-lem if it weren't for the production-sharing agreement (PSA) that governsthe project. PSAs are typically offeredby countries that are desperate for oilmajors to invest. To entice the com-panies, PSAs state that the host nationwill only get a share of the profits oncethe developer has recouped its costs.

In the mid-1990s, when Shell signedthe contract, the oil price was low andRussia was on its knees financially.Moscow needed the expertise Shelloffered. But by the time Shell wasannouncing a doubling of costs onSakhalin, President Putin was ratherless respectful of foreign energy com-panies. The cost increase--which post-

Part of the Sakhalin island project

poned, some said indefinitely, themoment when Russia would profitfrom the production of its own energyreserves-was too much for impatientofficials in Moscow.

To get control of the project, theKremlin, much to the joy of animalwelfare and environmental groups out-side of Russia, suddenly got green. Itunleashed Rosprirodnadzor, the coun-try's en'vironmental watchdog, onSakhalin. The alleged environmentalabuses of the project-including defor-estation, disruption of marine life, andcareless infrastructure across an earth-quake-prone region-are so bad thatthey "threaten to make Exxon Valdezlook small," says one insider.

Oleg Mitvol-the deputy head ofRosprirodnadzor, who was entrustedwith the job of bringing SakhalinEnergy to heel-had by last Decem-ber accumulated sufficient evidence ofShell's and its partners' abuses to lay

charges against the consortiumamounting to $30bn. There were alsothreats that the licence to develop theproject could be removed.

With the green gun at its head, Shellallowed Gazprom to take control of theproject-giving Russia an immediateshare of profits and oversight of costs.Taking the role of the humiliated manseriously, Shell's head Jeroen van derVeer thanked Putin for helping toresolve the conflict.

What most astonished Shell was thedetailed inside knowledge Mitvol hadaccumulated about the company'sabuses. Some in the company suspectedindustrial espionage. But it was actuallyinformation that the Donovans ofColchester were passing to Mitvol. Thetwo men had received detailed mater-ial about Shell's ecological abuses onSakhalin: a catalogue of corner-cutting,mismanagement and efforts to cover updamaging evidence. They say they gotthis information from Shell insiders.Mitvol clearly trusted the material, andin December he admitted for the firsttime publicly that his deep throat onSakhalin was John Donovan.

The Donovan website has become en"'an open wound for Shell. The Anglo- ~

Dutch giant has tried to shut it ~down on the grounds that it uses ~

'"'the company name. However, as ~www.royaldutchshellplc.com makes tno money, this hasn't worked. ~

"We wanted it to become a magnetfor people who had a problem with thecompany," Donovan told me when Ivisited him recently. It has. The Ogonitribe of Nigeria uses the website tospread information about Shell's activ-ities in the Niger delta. And unhappyShell insiders frequently post on thesite's live chat facility.

"I've also heard that AthabascaSands in Canada has some serious costproblems developing," wrote oneanonymous contributor in December."Anyone know if that is true or not? Ifso, Shell is really on the ropes, withCanada & Sakhalin over-budget,reserves shrinking & Nigeria produc-tion being lost by the day."

The site had around 1.7m hits inNovember. Its role in Shell's embar-rassment on Sakhalin has raised its pro-file. Understandably, the company isworried about the information thatleaks on to the website: Donovan saysthat it has taken out injunctions to stopat least one of its disgruntled geologists

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OPINI0NS/ BROWER

NUMBERS GAMEfrom posting on the site. He also saysthat his site and its whistleblowinginsiders were well ahead of the pack onShell's reserves scandal of 2003-04,when the company inflated its oil andgas reserves by some 20 per cent.

Donovan and his website have pre-cursors. Another successful "gripe site,"www.mcspotlight.org, has trackedMcDonald's for years. It was foundedafter the famous McLibel trial that cameto a climax in the high court in 1997,the fallout of which was a public rela-tions disaster for the US fast food chain.

The best historical comparison withthe Donovans and their fight, though,could be Ida Tarbell. One of the orig-inal "muckrakers," Tarbell's cam-paigning journalism against John DRockefeller's Standard Oil, publishedin the early 20th century, eventuallybrought the company before the UScourts. Antitrust legislation forced thebreak-up of Standard Oil into severalsmaller companies (Exxon, Mobil,Chevron and Amoco all rose fromStandard Oil's ashes).

Tarbell's grudge began after Stan-dard Oil had put her father's firm outof business. The source of John Dono-van's grudge is similar, although it cen-tres on the accusation that Shell stoleintellectual property belonging to himand his father. They had been in thegarage business since the 1950s andbegan selling ideas for promotions toattract customers to petrol stations. Atypical scheme would involve a tie-into a popular film. Shell liked the ideasthat Don Marketing, the Donovans'company, sold to them, says Donovan,and sales increased by so per cent onthe back of some of the campaigns.

Then, says Donovan, in the early1990s, a new manager in Shell's pro-motions division started stealing theideas. The men complained to the com-pany's senior management but wereignored. Offended that a company withwhich they had worked for so longshould treat them this way, the Dono-vans began their guerrilla war.

After various legal actions, Shellagreed to settle out of court, paying theDonovans a sum "in the thousands" aspart of a "peace treaty" stipulating thatneither party speak about the matter infuture. The Donovans were disap-pointed by the sum-their claim hadbeen for around £lm-but accepted"under duress." That was in 1999. But,says Donovan, Shell later broke the

PRICES GOING UP AND DOWNThe Bank of England monetarypolicy committee surprised theCity in January with an increasein interest rates. If inflationreaches a percentage point above(or below) the target rate of 2per cent a year, the governor ofthe bank is obliged to write aletter to the chancellorexplaining why the committeehas failed. And prices are goingup faster than 2 per cent a year,hence the rise in rates to try tokeep inflation in check. But whichprices are going up, and in whichsectors of the economy?Certainly not in retail sales, theproducts people buy in the shops.The average price of retail saleshas fallen in every year since1999. The average price in 2006was 4.7 per cent lower than whenLabour came to power in 1997,and virtually the same as in 1994,over a decade ago. Of course, inpart the average price measuresshifts in spending by consumerstowards cheaper products as wellas genuine price falls for thesame product, but inflation in theshops has still been negative.

Prices are steaming ahead inthose parts of the economy wherecompetitive forces are weak ornon-existent. For example, overone quarter of council tax billsnow go not on services to thepublic, but on the gold-platedpensions of council officials, Andcouncil tax increases, backed bythe force of law, proceed apace.Many of the former nationalisedindustry sectors-energy andtransport-also feel few

"peace treaty" by making disparagingremarks about them.

So Donovan launched his website--which costs only around £1 a week torun. And thanks to the ecological prob-lems on Sakhalin, Shell's poor record forbringing projects on stream on time andon budget and the power of the web, theDonovan grudge against Shell came toa spectacular climax in December.

Donovan is not worried that his site

constraints in raising prices, asthe rail fare increases in earlyJanuary show.

SHANE WARNE'S FAILUREThe debacle of the Ashes hascome and gone. But things couldhave been even worse for Englandin recent years if Shane Warnehad been less dedicated to thegood life off the field. As abatsman, he notched up 3,154runs in test cricket, by somemargin the highest total inhistory that does not include acentury. Warne made 12 scores of50 or more, but never got to 100.He does of course hold the recordfor the highest number of wicketstaken in test cricket: no fewerthan 708. Only four other bowlershave even taken more than 500;Warne's main rival, MuttiahMuralitharan of Sri Lanka, is on674. Yet in terms of runsconceded per wicket taken, Warneis not even in the top 50 testbowlers of all time, unlike histeammate Glenn McGrath andMuralitharan. McGrath alsoappears in the top 50 by strikerate--the average number of ballsdelivered per wicket taken-andWarne does not. Many of the all-time bests in terms of runsconceded and strike rates were set100 years ago by English bowlersslaughtering weak opposition onrain-affected pitches. So perhapsMcGrath, with a career total of563 wickets, has a good case to beconsidered the greater of thesetwo great contemporaryAustralian bowlers.

The Cruncher

became an instrument in the Russiangovernment's ambition to become anenergy superpower.

"Shell is not the worst oil companyin the world," says Donovan, "but wefeel they mistreated us very badly."Shell could have settled with the twomen for £lm in 1998. Instead, Shellsettled with the Russian governmentin December, with $30bn in fines hang-ing over the company's head. •

PROSPECT February 2007 13

http://www.mcspotlight.org,

Page 1Titles~;CONTRIBUTORS ,TO THIS ISSU~( contents OPINIONS 12 Rise of the gripe site 14 Being Frank 14 Swords to spaceships 15 Slow journalism 16 Slower technology INTERVIEW 20 Michael Rawlins COVER STORY Identity and migration ESSAYS 32 The library of Google 36 Europe's true stories PORTRAIT 42 Barack Obama SPECIAL REPORT 48 A rough guide to carbon trading

Page 2Titles• • opInIons RISE OF THE "'

Page 3TitlesNUMBERS GAME SHANE WARNE'S FAILURE