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EXTRACTED: Daily News Clips 5/5/22

Mark Hefflinger, Bold Alliance (Photo: Bryon Houlgrave/Des Moines Register

By Mark Hefflinger

News Clips May 5, 2022

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PIPELINE NEWS

WASHINGTON UPDATES

  • E&E News: GOP blocks 3 land bills over proposed mining, drilling bans

  • Politico: CEQ WANTS TO HEAR FROM YOU

STATE UPDATES

  • WPR: ‘This valve had been known to leak’: Documents show Superior oil refinery knew about equipment issues years before 2018 explosion

  • Carlsbad Current-Argus: ExxonMobil cuts methane pollution from fossil fuel operations in New Mexico

  • Bakersfield Californian: Judge rejects Kern’s oil lawsuit as ‘SLAPP’ case

  • Pittsburgh Post-Gazette: Conventional oil and gas industry sues to be excluded from Pa. methane rule

EXTRACTION 

  • Reuters: U.S. shale profits keep surging with sky-high oil prices

  • Financial Post: Oil companies face questions about carbon capture investment amid blockbuster quarter

  • PBS: The Fossil Fuel Industry Marketed Natural Gas as a Cleaner Alternative. But They Weren’t Monitoring for Methane Leaks, Former Exxon Mobil Engineer Says.

  • RBN Energy: Way Down In The Hole, Part 8 – Trio Of Projects Target Carbon Capture From Midwest Ethanol Plants

CLIMATE FINANCE

  • Globe and Mail: Activist investor vows to continue climate push after Enbridge shareholders reject proposal

  • Canadian Underwriter: Insurance Act changes may help Alberta as insurers retreat from oil and gas

OPINION

  • Globe and Mail: Suncor’s safety records overshadow the oil company’s ESG efforts

  • Bloomberg: Methane Is a Big Climate Problem That Bitcoin Can Help Solve

PIPELINE NEWS

Associated Press: ND company scrubs plans for trans-state natural gas pipeline
JAMES MacPHERSON, 5/4/22

“Despite millions of dollars in promised subsidies, a unit of North Dakota’s only Fortune 500 company says it won’t pursue plans to build a natural gas pipeline from western North Dakota’s oil patch to the eastern part of the state,” the Associated Press reports. “WBI Energy, a subsidiary of Bismarck-based MDU Resources Group, said the project is not viable due to regulatory uncertainty, limited in-state demand and rising construction, labor and land-acquisition costs. In a letter to North Dakota Pipeline Authority Director Justin Kringstad, the company said materials and construction costs have risen up to 50% in just the past nine months. “The recent and potential future inflationary pressure presents a significant challenge to a large-scale pipeline project from western to eastern North Dakota,” the company said. “This challenge is further compounded by the fact that the actual construction of a major pipeline project, if it were to proceed, would occur four to five years in the future, following an uncertain siting/regulatory process.” The North Dakota Legislature in November set aside $150 million in federal coronavirus aid to help construct such a trans-state pipeline for natural gas, which is a byproduct of oil production. The idea, backed by Republican Gov. Doug Burgum, was to help cut down on the wasteful flaring at well sites, and pipe it to communities in the gas-poor eastern part of the state, hoping to spur industrial development… “WBI Energy said the costs of securing pipeline right-of-way are estimated to be 25% higher than its previous pipeline projects “and frequently exceed recent market values for the purchase and sale of land in rural North Dakota.”

Bemidji Pioneer: Line 3 landowners urged to request pipeline decommissioning fund
Annalise Braught, 5/4/22

“Minnesotans for Pipeline Cleanup (MPC) is urging property owners along the route of Enbridge’s Line 3 pipeline to contact the Minnesota Public Utilities Commission (PUC) to ensure the pipeline’s proper decommissioning, whenever that day may come,” the Bemidji Pioneer reports. “According to a release, the landowners should “request that Enbridge be required to set up an adequate pipeline decommissioning fund so those who own the property are not financially liable when the pipeline eventually stops operation.” “Late last year, the PUC opened docket CN-21-823 to take comments about how much funding Enbridge should set aside for the abandonment of the new Line 3 pipeline,” the release said. “But broad public awareness among landowners along the new Line 3 route is lacking.” “…The Canadian government has required Enbridge to set aside $1.3 billion to pay for any costs related to decommissioning the pipeline, but currently, there is not a fund in place in the U.S… “Due to the novelty and complexity of this issue,” MPC says that landowners should request that the PUC initiate a contested case hearing and require that Enbridge notify all easement holders about this docket. Unless a contested case is called, landowners have until May 19 to submit comments on the size and terms of the trust fund.”

Business in Vancouver: Coastal GasLink natural gas pipeline nears 65% completion
Nelson Bennett, 5/4/22

“Two of eight sections of the 670-kilometre long Coastal GasLink natural gas pipeline are built, and the project overall is reaching the 65% completion mark, according to a project update,” Business in Vancouver reports. “But just how far behind schedule, how much over budget the project will be, and who will cover the cost overrun remains unclear. TC Energy Corp. (TSX:TRP) and LNG Canada are still wrangling over the question of who should cover the additional costs… “As part of its update, CGL announced that O.J. Pipelines, one of the project’s contractors, has partnered with three local First Nations development corporations to build Section 7. The three First Nations corporations are Natanlii Development Corp. (Skin Tyee Nation), Yinka Dene Economic Development Limited Partnership (Wet’suwet’en First Nation) and Kyah Development Corp. (Witset First Nation). All three communities are part of the Wet’suwet’en First Nation. All elected band councils within the Wet’suwet’en First Nation support the pipeline project and have benefits agreements with CGL and the provincial government. A number of Wet’suwet’en hereditary chiefs oppose the project, however, which has been subject to a series of blockades and acts of vandalism and harassment by protestors that have delayed progress on one section of the pipeline in the Morice River Road area near Houston… “The numerous road and bridge blockades set up by protesters forced CGL to seek court injunctions. The protests were concentrated along section 7, south of Houston. As a result, that is the only section of the pipeline project that has had no pipe laid, although CGL reports that 96% of the pipeline corridor has been cleared… “TC Energy, which is building the pipeline for LNG Canada, has warned that it expects the project will be “significantly” over budget and delayed in its completion. The project was budgeted to have a capital cost of $6.6 billion. TC Energy has warned it will cost significantly more than that.”

Radio Iowa: Summit has easements for 20% of carbon pipeline route through Iowa
5/5/22

“A project manager for the Summit Carbon Solutions pipeline says the company has about 20 percent of the voluntary easements from landowners they would need to complete the pipeline route through Iowa,” Radio Iowa reports. “…Right now, we’re going back and doing route changes. So as we’ve started acquire easements across the project, we’ve changed the route over 2000 based on landowner requests and every time we do that, they surveyor has to come back and survey again, so now we’re doing bits and pieces,” she said, “but the main portion has been completed.” “…Kretz said the company’s optimistic it will strike voluntary deals with many of the landowners who haven’t yet agreed to easements. “We’re virtually, you know, for the next eight months focused on working with the landowners and acquiring easements with them,” Kretz said. Kretz told the Kossuth County Board of Supervisors that Iowa ethanol plants may have to close if the pipeline isn’t built. “The ethanol plants’ carbon intensity score currently sits too high for the 2030-2040 regulations. If they don’t do anything to drop their carbon intensity score today, their doors will have to close in 2030,” Kretz said.

Buffalo News: FERC continues to mull National Fuel’s pipeline plan
Thomas J. Prohaska, 5/4/22

“National Fuel’s request for more time to complete its Northern Access pipeline remains unresolved,” the Buffalo News reports. “The company hasn’t started construction of the 95-mile natural gas line, but its federal permit says the construction had to be done by Feb. 3. National Fuel wants the Federal Energy Regulatory Commission to grant a new completion deadline of Dec. 3, 2024… “Wednesday, FERC, noting that National Fuel mentioned in January that it might need to “refresh” some of its permits and clearances, gave the company five days to say when those updates might be done. FERC sought a full list of the documents that have been obtained or may require an update, along with those that haven’t been granted, or which have expired.”

Natural Gas Intelligence: TC Energy Gearing Up to Supply Mexico LNG Export Terminal
ANDREW BAKER, 5/4/22

“TC Energy Corp. is preparing to expand its natural gas pipeline network to supply molecules to Sempra’s Energía Costa Azul (ECA) liquefaction project under construction on Mexico’s Pacific Coast,” Natural Gas Intelligence reports. “On a conference call to discuss first-quarter earnings, TC’s CEO Francois Poirier highlighted the U.S. Federal Energy Regulatory Commission’s approval last month of the proposed 500 MMcf/d North Baja XPress pipeline expansion.  The existing 86-mile North Baja system starts near Ehrenberg, AZ, and ends in Ogilby, CA, on the Mexico border. North Baja delivers gas produced in West Texas and the Rocky Mountains to markets in the western United States and Mexico. The expansion, with a projected in-service date of April 2023, entails upgrading one compressor station and two meter stations… “Elsewhere in Mexico, TC expects to complete construction of the 886 MMcf/d Tula-Villa de Reyes natural gas pipeline this year, management said. Completion, he added, is “subject to the successful resolution of ongoing negotiations with neighboring communities to obtain pending land access.” TC now expects liquefied natural gas (LNG) exports from North America to reach 25 Bcf/d by 2030, up more than 90% from current levels, according to Poirier… “So far this year, the second phase of TC’s 1.1 Bcf/d Grand Cheniere Xpress pipeline has entered service, while the 800 MMcf/d Louisiana Xpress pipeline is expected to be fully in service over the coming months. The pipelines serve Lousiana’s Calcasieu Pass and Sabine Pass LNG export facilities, respectively. In addition, over the last several weeks, TC has obtained approval from FERC for three pipelines with combined capacity of about 1.4 Bcf/d, all of which are designed to serve LNG exports as well.  In addition to North Baja XPress, projects greenlit by the Federal Energy Regulatory Commission include the 700 MMcf/d East Lateral XPress project on TC’s Columbia Gas Transmission system, which would support the proposed second phase of Venture Global Inc.’s Plaquemines liquefaction terminal.”

Pennsylvania Business Report: Report shows strengthened pipeline safety performance
LIZ CAREY, 5/4/22

“A new report from the American Petroleum Institute (API) and the Association of Oil Pipe Lines (AOPL) found that the safety of liquid pipelines across the country has increased across several indicators,” according to the Pennsylvania Business Report. “The 2021 Pipeline Safety Excellence Performance Report released Monday said an “industry culture of ‘safety first, safety always’ and a commitment to zero-incident operations” is responsible for a more than 30 percent decline in the number of liquids pipeline incidents over the past five years… “The report said that total pipeline incidents decreased by 17 percent, even while pipeline mileage and barrels per day increased. Additionally, pipeline incidents impacting people or the environment decreased by 31 percent, while those incidents caused by corrosion, cracking, or weld failure fell 32 percent over the last five years. And operation and maintenance incidents declined 34 percent since 2017. “The government’s own data shows liquids pipelines are getting safer,” AOPL President and CEO Andy Black said.

WASHINGTON UPDATES

E&E News: GOP blocks 3 land bills over proposed mining, drilling bans
Scott Streater, 5/4/22

“Three ambitious public lands bills with broad local support failed to advance yesterday as Senate Republicans sent a clear message to their Democratic colleagues that they will strongly oppose legislation that bans energy development and mining on federal land,” E&E News reports. “Republican members at yesterday’s Energy and Natural Resources Committee markup say they want the committee to approve legislation advancing critical minerals extraction and oil and gas development, and they vowed to continue a united front against any bill proposing to withdraw federal lands from mining and drilling until it does so.Thus, the committee yesterday deadlocked 10-10 along party lines on S. 173 , the “Colorado Outdoor Recreation and Economy (CORE) Act,” sponsored by Colorado Democratic Sens. Michael Bennet and John Hickenlooper. It would extend varying levels of protection to more than 400,000 acres in the state, including banning oil and gas drilling in sections of the Thompson Divide.” 

Politico: CEQ WANTS TO HEAR FROM YOU 
Matthew Choi, Josh Siegel, Kelsey Tamborrino, 5/4/22

“The White House Council on Environmental Quality will hold two public listening sessions on its draft Climate and Economic Justice Screening Tool this month to try to work out the kinks on the formula that will help determine what communities are eligible for prioritized environmental justice resources,” Politico reports. “The draft tool has already garnered some backlash from EJ activists for not explicitly taking race into account when screening communities, though the White House acknowledges racism is a major factor in environmental injustice and says it is eager to hear more on the issue… “CEQ extended the public comment period for the draft tool till Wednesday May 25.”

STATE UPDATES

WPR: ‘This valve had been known to leak’: Documents show Superior oil refinery knew about equipment issues years before 2018 explosion
Danielle Kaeding, 5/3/22

“Most workers were on break when an explosion rocked the Superior oil refinery, then owned by Husky Energy Inc., four years ago,” WPR reports. “In interviews with investigators after the incident, operations manager Brian McCusker recalled hearing two loud blasts that shook the control room of the refinery’s fluid catalytic cracking unit… “The blast knocked workers to the ground, injuring 36 refinery workers and contractors. Two workers suffered serious injuries including a punctured lung and spinal fractures while others walked away with minor cuts and bruises. Debris from the explosion struck a nearby tank and asphalt spilled into the refinery, catching fire and creating a large plume of black smoke that could be seen for miles. Many of the city’s 27,000 residents were forced to evacuate due to the smoke and fears that a tank containing the highly toxic chemical hydrogen fluoride may be compromised… “Nearly 1,300 pages of documents from OSHA obtained by WPR shed new light on what refinery officials knew in the days leading up to the explosion. The documents also indicate the company was aware years earlier of issues with the very equipment investigators believe caused the explosion. These include problems with a critical valve malfunctioning days before the explosion and documented erosion on that key piece of equipment dating back to 2008… “According to interviews and records, holes were found in the spent slide valve on two past turnarounds (April 2008 and April 2013), and those interviewed indicated that they were aware that this valve could leak because of catalyst erosion on the leading edge of the valve gate and seat ring,” the report states. Despite that knowledge, the refinery continued to use the valve and maintain its same schedule for repair and replacement every five years, according to OSHA documents. The agency found the refinery should have inspected the valve more frequently and possibly moved up the timeline for replacement. The refinery also failed to follow its own policy and procedure for ensuring mechanical integrity of equipment, according to OSHA.”

Carlsbad Current-Argus: ExxonMobil cuts methane pollution from fossil fuel operations in New Mexico
Adrian Hedden, 5/4/22

“One of the world’s largest oil and gas companies said it was making progress toward controlling climate-change-inducing air pollution emissions at a facility near Carlsbad in the New Mexico portion of the Permian Basin,” the Carlsbad Current-Argus reports. “ExxonMobil announced last week it had certified 200 million cubic feet per day of natural gas per day from its Poker Lake facilities in southeast New Mexico through independent certifier MiQ. The certifier gave Poker Lak an “A” grade, per a news release, the top rating MiQ gives to energy companies for using carbon capture technologies when producing fossil fuel. Tom Schuessler, senior vice president of unconventional operations at ExxonMobil told the Argus the certification will help the company meet increasing demand for fossil fuels produced with less environmental impact. “This certification further validates the steps we have taken to reduce methane emissions, which is part of our plans to achieve net zero Scope 1 & 2 greenhouse emissions in our Permian Basin unconventional operations by 2030,” he said… “The energy sector throughout the world was poised for further emissions reductions like those in the Permian Basin, potentially removing up to 550 million tons of CO2 from the atmosphere annually by 2030, per research from Rystad Energy. Carbon capture project announcements grew by more than 200 developments in 2021, representing three times the number of such projects in operation around the world… “With global CO2 emissions rebounding to new record highs post-Covid-19, the demand for CCUS projects is accelerating,” Lam told the Argus. 

Bakersfield Californian: Judge rejects Kern’s oil lawsuit as ‘SLAPP’ case
JOHN COX, 5/4/22 

“Kern County’s lawsuit challenging California’s de-facto ban on fracking has been thrown out of court after a Fresno judge ruled last month the filing was misdirected and improperly sought to limit Gov. Gavin Newsom’s speech or executive duties,” the Bakersfield Californian reports. “The little-noticed order April 5 by Fresno Superior Court Judge Gabriel L. Brickey found the county’s suit qualified as a “SLAPP,” or strategic lawsuit against public participation, which is more often associated with efforts by developers or others trying to silence criticism. Kern’s petition for writ of mandate, authorized in August by a 4-1 vote of county supervisors, had accused Newsom of overstepping his authority by unjustifiably denying permit applications for fracking and other well stimulation treatments common in Kern oilfields. They argued his administration was effectively denying good-paying jobs and property tax revenue to the state’s top oil-producing county. It remained unclear Wednesday what implications, if any, the county’s legal defeat may have for three industry-funded lawsuits that followed after the county’s lawsuit and asked for essentially the same thing: an end to the administration’s practice of withholding fracking permit approvals based not on technical problems but health and climate concerns… “Kern Chief Administrative Officer Ryan Alsop told the Californian the county was disappointed with the ruling but proud to have been the first to challenge the governor’s “decision and directives that ignore both the role of the Legislature and existing law to end most new oil drilling in Kern County.”

Pittsburgh Post-Gazette: Conventional oil and gas industry sues to be excluded from Pa. methane rule
LAURA LEGERE, 5/5/22

“Three trade groups for Pennsylvania’s conventional oil and gas industry are suing state environmental regulators to block a forthcoming rule for controlling methane and other air pollution from applying to their well sites,” the Pittsburgh Post-Gazette reports. “The state Department of Environmental Protection created a single rule that applies to conventional and unconventional wells sites “in blatant disregard” of a 2016 state law that requires conventional wells to be regulated independently from those tapping the Marcellus and Utica shales, the industry groups argue… “The Pennsylvania Independent Oil & Gas Association, the Pennsylvania Grade Crude Oil Coalition, and the Pennsylvania Independent Petroleum Producers Association are asking the court to prohibit the state from publishing the rule “unless and until the scope of the rule is clarified to apply only to unconventional wells” and associated equipment. They are also asking the court to declare any part of the rule that applies to conventional well sites “unlawful.” They say the state’s environmental rule-making board was required to create separate air pollution standards for the tanks, valves and other equipment attached to their usually small, shallow wells. Because the board didn’t create separate standards, conventional well operators “will be forced to comply with requirements that are not technologically feasible, economically feasible, or neither,” they wrote in court filings… “Environmental groups have skewered the rule for exempting tens of thousands of existing conventional well sites from regular leak checks. Only 95 of the state’s 27,000 producing conventional well sites will be required to perform new quarterly or annual leak monitoring because the rest produce too little oil or gas to qualify.”

EXTRACTION 

Reuters: U.S. shale profits keep surging with sky-high oil prices
By Ruhi Soni and Liz Hampton, 5/4/22

“Top U.S. shale producers on Wednesday reported blockbuster first-quarter profits and most poured cash into higher dividends and share buybacks as oil prices churned along at the highest levels in years,” Reuters reports. “Pioneer Natural Resources (PXD.N)posted a five-fold jump in first-quarter profit and raised its dividend, while earnings at Continental Resources (CLR.N) more than tripled. Shale-gas producer Chesapeake Energy initiated a $1 billion share repurchase program after raising its free cash flow outlook. Producers were prioritizing shareholder returns over new spending on production even as Western sanctions on Russia sent crude prices to 14-year-highs during the quarter. Investors had demanded better returns after years of capital spending turned shale into a Wall Street pariah. Pioneer declared it would pay $7.38 per share in dividends, up from $3.78 last quarter. Shares jumped 6.7% in after-hours trading to $269.85 each… “Continental’s adjusted profit was $960 million, or $2.65 per share, up from $278.9 million, or 77 cents per share, a year earlier… “This week, Devon Energy (DVN.N), Diamondback Energy (FANG.O) and Coterra Energy (CTRA.N)boosted shareholder payouts after posting better-than-expected profit.”

Financial Post: Oil companies face questions about carbon capture investment amid blockbuster quarter
Meghan Potkins, 5/4/22

“MEG Energy Corp. CEO Derek Evans says significant spending on carbon capture in the oilsands is still three or more years away and will require the Alberta government to top up Ottawa’s existing tax credit to cover 75 per cent of the cost,” the Financial Post reports. “Midway through what’s shaping up to be a record first quarter, Canadian oil and gas companies are facing tough questions about when capital spending budgets will begin to reflect the industry’s stated commitment to decarbonization through large-scale carbon capture, utilization and storage (CCUS) technology. There have been signals that the Trudeau’s government’s newly unveiled CCUS investment tax credit — allowing companies to claim up to 50 per cent of the cost associated with carbon capture technology — wouldn’t be sufficient to unleash a flood of new carbon capture projects. Now, comments from the heads of some of the country’s largest oil and gas companies appear to confirm the sector is waiting for Alberta’s government to up the ante on public support for the multibillion-dollar projects. “We have talked publicly about the need for 75 per cent support at the capital level, so obviously we’d love to see the province finding a way to bridge that gap,” Evans said on a conference call with analysts on May 3… “But the request from oilsands producers for more government support for carbon capture has frustrated critics who say the public shouldn’t be on the hook for decarbonization costs when the sector is swimming in profits.”

PBS: The Fossil Fuel Industry Marketed Natural Gas as a Cleaner Alternative. But They Weren’t Monitoring for Methane Leaks, Former Exxon Mobil Engineer Says.
Patrice Taddonio, 5/3/22

“During the early years of the Obama administration, the fossil fuel industry was experiencing an historic boom, despite widespread concern about climate change,” PBS reports. “…As Delay, the final episode of the three-part FRONTLINE docuseries The Power of Big Oil, reports, the Obama administration and even the Sierra Club initially embraced and mirrored the messaging that natural gas was less harmful to the environment than coal. That idea had also been attractive to Dar-Lon Chang, who joined Exxon Mobil in 2003 after getting his PhD in mechanical engineering. “The fact that natural gas was much cleaner burning than coal, that it produced half the carbon dioxide emissions of coal, those were very appealing to me,” Chang says in the above excerpt from The Power of Big Oil: Delay. But there was a problem. Chang knew the methane in natural gas had the potential to do significant damage if allowed to leak. “Natural gas is primarily methane, and methane, when it’s leaked out to the atmosphere, can have orders of magnitude more global-warming impact than carbon dioxide,” he says. As the fracking boom took shape and became what he calls a new “Wild West,” Chang worried that the thousands of new, lightly regulated fracking operations in the U.S. could be leaking massive amounts of methane and turbo-charging the climate crisis: “I already felt that having many methane gas wells was a ticking time bomb for methane gas leaks,” says Chang, who previously spoke with Inside Climate News. “The more engineering infrastructure, the more wells and the more pipes, the more potential there is for leakage.” “…In reality, Chang, who left Exxon Mobil in 2019 after working on the company’s fracking push inside the U.S., tells PBS, “the industry was not monitoring methane leakage, so they did not have data about how much was leaking. And there wasn’t much appetite for management to measure methane leakage because, if they found out there was a problem, they would have to do something about it.”

RBN Energy: Way Down In The Hole, Part 8 – Trio Of Projects Target Carbon Capture From Midwest Ethanol Plants
Jason Lindquist, 5/2/22

“Carbon-capture projects have been slow to take root in the U.S., but that may be changing as a number of companies are now advancing plans to capture the carbon dioxide that results from ethanol production in the Midwest,” RBN Energy reports. “Ethanol plants are an obvious choice, given that the CO2 resulting from ethanol fermentation is highly concentrated, which makes capturing it more efficient (and less expensive) compared to many other industrial processes. But while the relative ease and economy of capturing those emissions might seem like a no-brainer, convincing the public to go along with those plans has been more difficult… “The three pipeline projects have had great success in lining up partners and designing systems that would permanently sequester a lot of CO2 once they come online. They haven’t had nearly as much success in overcoming opposition from local landowners, who have used meetings with project backers to cite concerns about pipeline safety, the merits of carbon capture, the motives of project developers, the effects on land values, and the potential use of eminent domain to acquire land… “The pipeline plans have also drawn the opposition of environmental groups, who say the projects are environmentally risky, incentivize the further use of fossil fuels and do not advance long-term climate goals. Objections have also been raised about the way the pipelines have been promoted at the state level.”

CLIMATE FINANCE

Globe and Mail: Activist investor vows to continue climate push after Enbridge shareholders reject proposal
EMMA GRANEY, 5/4/22

“An activist investor failed in its bid to get Enbridge Inc. ENB-T to strengthen its climate promises on Wednesday, but will continue its push to hold Canadian energy companies and banks to account for their net-zero goals,” the Globe and Mail reports. “It was the latest attempt by activists to get shareholders to help press large corporations to improve their climate action… “Wednesday’s proposal, tabled at the energy company’s annual general meeting, requested that Enbridge strengthen its decarbonization commitments by the end of the year and make those goals “consistent with a science-based, net-zero target.” The proposal was tabled by DI Foundation – a small, B.C.-based charity that holds a handful of Enbridge shares. The foundation was represented by Investors for Paris Compliance, a non-profit that wants to use shareholder pressure to improve accountability around Canadian public companies’ net-zero plans. For now, it’s targeting the energy sector and banks. But corporate engagement director Duncan Kenyon told The Globe and Mail the team plans to expand to other parts of the Canadian economy. And it wants eventually to purchase stocks to get the ear of companies itself… “About a quarter of them voted in support of the proposal on Wednesday – a result Mr. Kenyon called “encouraging.” That was even though the board urged shareholders to vote no, arguing in a March management circular that the net-zero framework for midstream oil and gas is still evolving, so “it would be imprudent” for Enbridge commit to future decarbonization guidelines until more work is done and can be assessed alongside the company’s current goals. Adopting the proposal would amount to “immediate, radical change” that would destroy shareholder value, the board said, adding that Enbridge’s current net-zero strategies “and a deliberate and prudent approach to the energy transition is the best course of action.”

Canadian Underwriter: Insurance Act changes may help Alberta as insurers retreat from oil and gas
Philip Porado, 5/4/22

“Major insurers continue to announce they’ll cease issuing coverage to the oil and gas industry, which remains economically critical to Alberta and other Canadian provinces – and is poised to experience a demand boost as Europe seeks alternatives to Russian energy products,” Canadian Underwriter reports. “On Apr. 29, Allianz said it would stop investing in or underwriting new single-site and standalone oil and selected gas risks as of next Jan. 1, and not renew existing contracts after July 2023… “Allianz’s news follows similar statements from others, including a Mar. 1 announcement in which AIG “committed to no longer invest in or provide insurance for construction of any new coal-fired power plants, thermal coal mines or oil sands.” “…In that light, Alberta’s pending Bill 16 to modify its Insurance Act and Captive Insurance Companies Act could be a boon for Canada’s oil and gas sector. “The need for insurance for particularly the energy sector can’t be overstated…Catastrophic incidents…have occurred across the world with regard to producers of energy,” said Alberta Legislative Assembly member Joe Ceci during an Apr. 27 reading of the bill. “Catastrophic events need to be backstopped with appropriate insurance through those companies. The industry needs the ability to access that insurance.” Among other things, Bill 16 would address high regulatory charges tied to the purchase of unlicensed insurance in Alberta. Currently those charges stand at 50% but would drop to 10% if the bill becomes law. Likewise, a 50% financial penalty for late payment of charges and taxes on unlicensed insurance would drop from 50% to 10%.”

OPINION

Globe and Mail: Suncor’s safety records overshadow the oil company’s ESG efforts
Jeffrey Jones, 5/5/22

“Suncor Energy Inc. chief executive officer Mark Little is regarded as a leader in Canada’s oil industry when it comes to taking environmental, social and governance, or ESG, issues to heart,” Jeffrey Jones writes for the Globe and Mail. “Mr. Little was instrumental in the formation of the alliance of major oil sands producers that is aimed at dealing with the biggest problem stemming from the sector – chronically high carbon emissions… “But now Mr. Little and Suncor face a more immediate challenge in a campaign by U.S. activist investor Elliott Investment Management LP to force change at the company, install five new directors and possibly oust Mr. Little himself… “To be clear, Elliott has no beef with Suncor’s environmental initiatives such as Oil Sands Pathways or efforts to use less energy in operations and to reclaim mine sites. In fact, the hedge fund is complimentary on the energy company’s record in the “E” – environmental – category of ESG. A top criticism, though, involves the “S” – social – part, and specifically Suncor’s recurring trouble preventing employees from getting hurt in operational mishaps. That makes this activist flare-up fascinating in an industry where ESG-related friction has lately focused on carbon emissions… “Elliott, by contrast, says improving Suncor’s safety record is a big part of its prescription for improving returns. The message is resonating with other shareholders… “As a company that often says ESG is a key part of how it operates, this will be a case of showing how Suncor can bring “G” – governance – to bear to solve the problems that Elliott has made into a very public issue.”

Bloomberg: Methane Is a Big Climate Problem That Bitcoin Can Help Solve
Trung Phan, 5/3/22

“ExxonMobil is mining Bitcoin.” That unlikely headline was recently splashed across major business publications. In a project that began in January 2021, Exxon teamed up with the startup Crusoe Energy Systems Inc. to use excess gas from its North Dakota oil fields to mine Bitcoin,” Trung Phan writes for Bloomberg. “…Crusoe is able to use the excess gas in a process it calls digital flare mitigation. The startup has built dozens of mobile data centers that are placed onto oilfield sites where flaring takes place… “Last month, Crusoe raised $350 million in a Series C funding round. It already operates in North Dakota, Wyoming and Colorado but will use the funds to expand into other areas where flaring is widespread: the Permian Basin (Texas), Argentina, Oman and Abu Dhabi. Lochmiller told Bloomberg TV that if the 14 billion cubic feet of gas that gets flared every day could be harnessed for computing, you could power the whole Bitcoin network eight times over… “While Bitcoin provides a climate-friendly alternative to flaring, a critic might point out that the entire digital network is an energy sink that is net-net bad for the environment… “Bitcoin mining is the best buyer of last resort,” Lochmiller explains. “Few industrial use cases can use lots of energy like Bitcoin and shut down in 5 minutes. You can’t do that for an aluminum smelting plant.”

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