Question

ETHICAL DILEMMA Glow Images RF ESOUR GLOBALR Jon Bennett had always lamented that his grandfather's prospecting skills in the far reaches of rural Texas had succeeded in completely missing any lucrative oil depos. its. The land was basically worthless scrub that barely supported a small cattle operation that made so little money that Bennett was forced to work a second job as a mechanic at the only gas station in the one stoplight town at the eastern border of his land. Now, however, if that nerdy little engineer from Global Resources was to be believed, all that was about to change. Bennett had been hearing about ranchers in Colorado and Wyoming getting big checks for natural gas drilling rights on their land, and now it seemed that while his grandfather's land had no oil, it had enough natural gas deposits in a type of rock called shale to interest one of the largest natural gas producers in the country. He and his neighboring landowners had attended a very slick pre- sentation in the town hall, where engineers from Global had laid out how much natural gas they thought was in the area, and how they would go about getting it out of the ground. They had kicked off the presentation with a video that outlined how "Socially responsible" Global was, how the company was committed to "transparency (a big word for "full disclosure"), and how it made every effort to protect the environment and the communities in which it operated. One of the engineers had stated, "We believe there's enough natural gas here to keep our wells busy for decades, but when we're done, I promise you we'll leave the place exactly as we found it-you'll never be able to tell we were even here." Since the town was centrally located to several large ranches in the area. Global was planning, they said, to invest a considerable amount of money in expanding the Infrastructure of the area, Bennett wasn't exactly sure what that meant, but he heard the words: more roads, more jobs, new storage facilities, bigger schools. That was enough to get his attention The town hall meeting had been for invited landown- ers only, but Bennett had been surprised to see people picketing outside the hall. They carried signs proclaiming that "Fracking is Toxic!" and "Global Lies!" and they were yelling slogans including: "Don't be tempted by the money!" "Don't Believe Them!" and "Fracking will kill our Believe Them!" and "Fracking will kill our land!" Bennett hadn't heard the word frocking before, but when he fired up his old laptop and started searching the web, the information he found did give him cause for concern. The injection of pressurized fluids (meaning water and other chemicals to break up the shale rock to release the natural gas was perfectly safe or dangerously toxic. Critics argued that the research on the chemicals being used was too new to fully understand the consequences to the local water supplies and soil. Advocates of the process argued that was no different from the pumping of mud into oil wells to replace the oil being drilled out of the ground. That had seemed reasonable to Bennett, but the video of a man in Pennsylvania lighting a match at his kitchen sink and watching the water coming out of his faucet catch fire was disconcerting. Bennett was even more confused after the leasing specialist from Global visited him at his ranch Mr. Bennett he began, "based on our study of your acreage, we are prepared to offer you an initial payment of $500.000 for drilling rights, and I can confidently forecast an annual payment to you of at least $250,000 for the next 10 years QUESTIONS 1. If Globalis paying a fair market price for drilling rights, are there any ethical violations here? Why or why not? 2. Are the Global engineers as committed to "full disclosure as they claim to be? 3. Is Global Resources Corp. being socially responsible or are its local initiatives just window dressing? 4. What would you do if you were in Bennett's shoes? Why?

Is global being socially responsible or are there local initiatives just window dressing?

If global is paying a fair market price for the drilling rights, are there any ethical violations here? Why or why not?

Answer 1

Yes, Global is being socially responsible if this new project abides by words as more roads, more jobs, new storage facility etc.

But if it fails to do so, and the massive propaganda of defaming global comes out to be true that Global lies and also, natural gas that is released by chemicals and other fluids is dangerously toxic then it can be said that these initiatives were just window dressing.

Yes, Global is paying fair market price and there are no ethical violations mentioned here as it is paying $ 5 lac initially and $ 2.5 lac for next 10 years