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EXTRACTED: Daily News Clips 5/9/22

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

By Mark Hefflinger

News Clips May 9, 2022

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PIPELINE NEWS

  • NPR: Tennessee passes bill that protects oil and gas industry

  • Red Lake Nation News: Standing Rock Sioux Tribal Chairwoman Janet Alkire Meets with Assistant Secretary of the Army Michael Conner and Demands Transparency with the Dakota Access Pipeline

  • Canadian Press: Line 5 pipeline still ‘non-negotiable’, Canada’s natural resources minister says amid latest court challenge

  • Indian Country Today: Enbridge takes the gloves off in Line 5 battle

  • TheEnergyMix: ‘Terrifying’ Regulatory Gaps Leave U.S. Unprepared for Massive CO2 Pipeline Expansion, Experts Warn

  • South Dakota News Watch: Experts question cost and viability of proposed CO2 pipeline projects

  • Iowa Farmer Today: Landowners, companies debate pipeline process and safety

  • LeMars Sentinel: Alternative route proposed for pipeline project

  • Energy News Network: Iowa carbon pipeline opponents see lessons from Dakota Access fight

  • Philadelphia Inquirer: Mariner East Pipeline has sparked a boom in fracked gas exports from Philly region

  • Williston Herald: PSC presses Bridger Pipeline on details for proposed 105,000 transmission line

  • Gothamist: National Grid’s pivot to ‘renewable’ natural gas would require more pipelines, keep producing carbon

WASHINGTON UPDATES

  • Politico: STORE THE CARBON 

  • E&E News: Why EPA might make new gas plants catch carbon

  • E&E News: NEPA energy reviews rely on flawed climate metric — report

  • Politico: MALLORY ON THE HILL

  • Bloomberg: EPA Union Seeks Climate Emergency Declaration to Hire More Staff

STATE UPDATES

  • City and State: New York’s once-booming oil industry and the risky wells it left behind

EXTRACTION

  • NPR: The good times are rolling for Big Oil. 3 things to know about their surging profits

  • Reuters: Explainer: Why are U.S. natural gas prices soaring?

  • Reuters: Shell posts record quarterly profit, lifted by energy price surge

  • Reuters: Suncor CEO Little faces scrutiny after activist Elliott takes aim

CLIMATE FINANCE

  • Wall Street Journal: Billionaire George Kaiser’s Bank Drills Deeper Into the Oil Patch

  • Houston Chronicle: Capital for oil, gas producers were extremely scarce a year ago. Today, the outlook has changed.

OPINION

PIPELINE NEWS

NPR: Tennessee passes bill that protects oil and gas industry
CAROLINE EGGERS, 5/7/22

“Tennessee is poised to let gas and oil companies build new infrastructure without local interference. It comes after activists helped stop a pipeline through Black neighborhoods in Memphis,” NPR reports. “…Tennessee lawmakers passed that bill after Memphis stopped a planned oil pipeline through mostly Black neighborhoods and above the city’s drinking water. Among those opposing the project was former Vice President Al Gore… “This was an unusual environmental justice victory in a country where many Black and brown neighborhoods have historically lived with disproportionate levels of pollution. And as Memphis environmentalist Justin Pearson says, Tennessee lawmakers swiftly responded to it. JUSTIN PEARSON: By stripping that power away and handed it to executives who don’t care about Tennessee, who don’t live here, and are only using our land for their own profit gains… “But Vaughn skipped over some important details, like the impact of fossil fuels on the climate, environment and people. For example, the bill blocks cities from regulating or enforcing pipeline safety. Since gas pipelines on rare occasions can explode, neighbors often want them far away. While the bill was explicit in some areas, like excluding solar energy, it’s vague in others. The bill never defines what would be considered a prohibition on fossil fuel siting or development. George Nolan, an attorney with the Southern Environmental Law Center, told NPR courts may have to interpret the text. GEORGE NOLAN: There’s some broad language in this bill that pipeline companies, energy companies could use to intimidate local governments from standing up for their communities. EGGERS: By intimidate, he means threatened with lawsuits. This legislation follows a trend in Tennessee of mostly white state leaders limiting the influence of local governments with large Black populations, notably in Memphis and Nashville.”

Red Lake Nation News: Standing Rock Sioux Tribal Chairwoman Janet Alkire Meets with Assistant Secretary of the Army Michael Conner and Demands Transparency with the Dakota Access Pipeline
5/9/22

“Janet Alkire, the Chairwoman of the Standing Rock Sioux Tribe, recently met with Assistant Secretary of the Army (CW) Michael Conner to discuss the environmental review of the Dakota Access pipeline (DAPL),” Red Lake Nation News reports. “The Army Corps of Engineers is currently preparing an Environmental Impact Statement (EIS) to determine whether to grant an easement for the pipeline. DAPL has continued operating on Corps-administered land, even though the prior easement was vacated by federal Judge James Boasberg over two years ago. Alkire met with Conner on April 28, and demanded transparency in the environmental review process. “Standing Rock has requested a number of basic documents and plans, such as the oil spill response plan for the Missouri River,” she explained. “We have received no information whatsoever, and the failure to cooperate with our Tribe and our emergency managers is continuing.” The Corps of Engineers Omaha District originally planned to release a draft environmental study for public comment last month. But Standing Rock withdrew as a Cooperating Agency for the environmental impact study, citing the lack of transparency in the process, and a failure by the Corps to consider the operator’s safety record. That prompted the Civil Works leadership of the Army to announce a “pause” in the process, leading to Alkire’s meeting with Conner. “None of our concerns with DAPL are getting addressed, and the process is compromised by secrecy,” Alkire stated. Alkire also called upon the Army to consider the Notice of Violation issued by federal regulators against the pipeline’s parent company, Energy Transfer LP, for violations of pipeline safety rules in the operation of the DAPL. “DAPL is violating numerous safety regulations and the Corps of Engineers must shut down the pipeline, and properly consider these violations in the upcoming Environmental Impact Statement,” Alkire stated… “According to Alkire, the Corps should use the “pause” in the EIS process to reconsider the risk posed to the environment from DAPL. She insists that the Corps order the pipeline to be shut down in the meantime.”

Canadian Press: Line 5 pipeline still ‘non-negotiable’, Canada’s natural resources minister says amid latest court challenge
James McCarten, 5/6/22

“Natural Resources Minister Jonathan Wilkinson is doubling down on Canada’s assertion that the continuing operation of the Line 5 pipeline is “non-negotiable,” the Canadian Press reports. “Wilkinson made the comments Friday in the House of Commons as Opposition MPs seized on media reports that the controversial cross-border pipeline is facing yet another court challenge. On top of efforts by the state of Michigan to shut down Line 5, an Indigenous band in Wisconsin is now asking a judge there to do the same. The Bad River Band of Lake Superior Tribe of Chippewa argues in court documents that Enbridge Inc., the pipeline’s owner, no longer has the right to operate on its territory. Fifteen of the 20-year easements that allowed the company to operate on band territory expired back in 2013 and were never properly renewed, they argue in court documents. “Enbridge has continued to operate the pipeline as if it has an indefinite entitlement to do so,” say the documents, first reported by the Globe and Mail. “This constitutes an unlawful possession of the subject lands, and an intentional, ongoing trespass upon them.” The band filed a motion in February seeking a summary judgment against Enbridge — in other words, to shut down Line 5 without a trial. “The continued operation of Line 5 is non-negotiable,” Wilkinson said Friday in response to a question from Conservative MP John Brassard. “We will take appropriate steps to ensure the continued safe operation of this critical infrastructure. And we continue to work closely with the owner of Line 5.” Wilkinson said he will continue to raise the matter in discussions with his U.S. counterparts. Federal officials say the minister will be in D.C. for meetings on a number of bilateral issues in the coming days, potentially as early as next week.

Indian Country Today: Enbridge takes the gloves off in Line 5 battle
MARY ANNETTE PEMBER, 5/9/22

“Enbridge is getting personal with the Bad River Ojibwe tribe over the company’s Line 5 pipeline route through tribal lands in Wisconsin,” Indian Country Today reports. “In recent lawsuits, Enbridge has targeted individual tribal members and staff, seeking the court’s permission to question them under oath about their “thought process” in opposing renewal of the company’s easement through the reservation. “…Five Michigan tribes including the Bay Mills Indian Community, Grand Traverse Band of Ottawa and Chippewa Indians, Little Traverse Bay Band of Odawa and the Nottawaseppi Huron Band of Potawatomi signed friend-of-the-court briefs in support of the legal action. And in May 2021, the Bay Mills tribal council voted to banish Enbridge’s Line 5 pipelines from tribal lands… “Enbridge filed a counter-suit in May 2021, claiming that requirements for the company to obtain access permits in order to conduct maintenance on the line are unlawful and unreasonable. Among the defendants named in the lawsuit are Naomi Tillison, the Bad River tribe’s natural resource director. “Director Tillison’s purported ‘requirements’ for Enbridge Energy to obtain access permits for accessing Line 5 are unlawful and not supported by any legal authority,” according to Enbridge’s lawsuit. The company asked the court to allow attorneys to take statements under oath with tribal council members over their opposition to the Line 5 easement. Wiggins told ICT the suit is taking an adversarial approach to the tribe. “Enbridge is suing us, litigating adversarily as though we’re enemies, because we want them out of our watershed,” Wiggins said… “Angelique Eaglewoman, professor and co-director of the Native American Law and Sovereignty Institute at Mitchell Hamline School of Law in St. Paul, Minnesota, described Enbridge’s legal strategy as intimidation tactics.”

TheEnergyMix: ‘Terrifying’ Regulatory Gaps Leave U.S. Unprepared for Massive CO2 Pipeline Expansion, Experts Warn
Chris Bonasia, 5/8/22

“Carbon dioxide pipelines supporting a fast uptick in carbon capture and storage (CCS) could threaten the safety of countless communities across the United States, say experts, due to federal pipeline safety regulations that are woefully inadequate to cover the “flurry of multibillion-dollar CO2 pipeline proposals” now eligible for tax credits,” TheEnergyMix reports. “The country is ill prepared for the increase of CO2 pipeline mileage being driven by federal CCS policy,” writes Richard Kuprewicz, an independent pipeline safety consultant and author of a recent report from Pipeline Safety Trust. Pipeline safety regulations must immediately change “to rise to this new challenge” and win public confidence, he adds… “But according to the Pipeline Safety Trust report, PHMSA’s regulations have “terrifyingly large gaps on carbon dioxide pipelines, including having no regulations if the CO2 is transported as a liquid or a gas, only as a supercritical fluid.” These gaps are dangerous, says the advocacy group, as CO2 is a lethal asphyxiant that can travel large distances from the site of a pipeline rupture. Ruptures can open like a zipper to run down a significant length of pipe and “release immense amounts of CO2, hurl large sections of pipe, expel pipe shrapnel, and generate enormous craters,” the report says… “Communities in neighbouring Iowa are also objecting to Summit Carbon Solutions’ pipeline plans, and are forming a grassroots coalition similar to the one that resisted the Dakota Access underground oil pipeline in 2016. The state’s Sierra Club chapter has also weighed in, reporting that the majority of counties that would be affected by CCS pipelines have filed objections with the Iowa Utilities Board.”

South Dakota News Watch: Experts question cost and viability of proposed CO2 pipeline projects
Bart Pfankuch, 5/6/22

“So far, most of the discussion about two proposed multibillion-dollar carbon dioxide pipelines that would cross hundreds of miles of eastern South Dakota has centered on opposition by landowners whose properties would be affected by the digging and laying of underground pipes carrying a potentially dangerous chemical,” South Dakota News Watch reports. “…Pipeline construction tears up land owned in some cases for generations by the same families; there’s an inherent risk of leakage; farmland is turned over and taken out of production; drain-tile systems and water-flow patterns can be affected; and payments for use of the land are far from life-changing. Hundreds of South Dakota landowners have signed up to address state regulators about the Summit project, many in strong opposition. However, another battle is brewing over CCS on a much larger scale. The expansion of CCS projects across the U.S. is raising concern among some experts who say the new investment into CCS has the potential for long-range negative consequences for the U.S. economy and the environment of the planet. A fundamental question is whether the practice of CCS is the best way forward in the effort to reduce carbon emissions into the atmosphere. Also in play, however, is the debate over the cost, and whether spending billions on carbon-capture technology is the best use of taxpayer money and industry investment… “Those who oppose CCS also say the process is a way of actually extending the time America and the world are reliant on fossil fuels for transportation. “It’s such a dangerous form of green-washing, where you’re trying to take an environmentally destructive activity and rebrand it in a way that makes it appear benign,” Basav Sen, the climate-justice project director at the Institute for Policy Studies in Washington, D.C, told SDNW. “The idea of using energy sources that put carbon into the atmosphere and addressing it after the fact by attempting to capture that carbon and store it in the ground is a non-starter.”

Iowa Farmer Today: Landowners, companies debate pipeline process and safety
Aaron Viner, 5/6/22

“As three carbon pipeline project proposals continue to move forward in Iowa, landowners continue to make their voices heard,” Iowa Farmer Today reports. “Sylvia Spalding, from Mahaksa County near Oskaloosa, Iowa, has had land along the South Skunk River in her family since 1843. One of the three proposed projects, the Heartland Greenway Project, would cut adjacent to some of her land, and she said she feels as climate change is not the primary interest of the pipeline companies. “It’s these massive corporations and they are doing this for federal tax credits,” Spalding told IFT. “Money is what is driving it.” She said the lack of transparency is one of her biggest issues that is frustrating her with the process which has led to her going to the Iowa State Capitol and making her voice heard. However, she feels that hasn’t been enough… “Other Iowans, such as Nevada farmer Bill Couser, are touting the other benefits of the carbon pipelines and say that these projects will do a lot for the farmers who may have their land impacted. Couser called the pipelines the “future of ethanol,” in a letter to Iowa Farmer Today and hopes people are able to see it can boost the state’s economy… “However, landowners, such as Spalding, are voicing safety concerns in addition to worries over eminent domain… “She worries about possible leaks of the underground pipeline and the long-term effects it could have on the health of the community.”

LeMars Sentinel: Alternative route proposed for pipeline project
Beverly Van Buskirk, 5/9/22

“An April 12 letter to the Iowa Utilities Board by the Plymouth County Board of Supervisors made a request regarding the proposed route of the Summit Carbon Solutions pipeline around the city of Merrill,” the LeMars Sentinel reports. “…In the letter drafted by Supervisor John Meis, a civil engineer, the supervisors called on Summit Carbon Solutions to eliminate the route on the west side of Merrill as the route would be detrimental to the future growth of Merrill. As proposed, the pipeline would separate existing subdivisions and future development of the town. The supervisors proposed “a more acceptable alternate route,” indicating a route to the east would be the obvious route to follow. A map was included with the letter. Supervisors Chair Don Kass, Craig Anderson and Meis, all said it was necessary to point out the pipeline path needed to be changed. “The proposed route would put it more or less on the west edge of Merrill across land that is not yet in the city of Merrill,” Kass said. “However it’s development property in that exact spot. The owner requested that Summit move it to the extreme west edge.” Anderson said it appeared to all the supervisors there were better ways for the pipeline to connect to the Plymouth Energy ethanol plant north of Merrill… “Now in the meantime since we sent the letter, the Iowa Utilities Board has agreed, because the landowner of the subdivision said you are not going to do this on my land at any price, so the pipeline has agreed to move it further west, which is certainly better,” Anderson said.

Energy News Network: Iowa carbon pipeline opponents see lessons from Dakota Access fight
Dan Haugen, 5/6/22

“We’re a long way from another Standing Rock,” Energy News Network reports. “In Iowa, though, a coalition similar to the one that took a stand against the Dakota Access Pipeline in 2016 is emerging to fight a proposed interstate carbon dioxide pipeline network, and opponents say they’re more organized and energized at this stage thanks to lessons learned last decade. “People forget the fight against DAPL” — the Dakota Access Pipeline — “started in Iowa,” said Sikowis Nobiss, founder and executive director of Great Plains Action Society, a regional collective of Indigenous organizers formed in part to help galvanize resistance to Dakota Access among tribal governments. “Here we are again starting a fight against a pipeline in Iowa.” “…Nobiss, a citizen of the George Gordon First Nation, sees parallels with the Dakota Access movement, specifically in the unlikely alliances forming among environmental and Indigenous activists and White landowners who see pipeline construction as a threat to their farmland. Concerns about eminent domain have drawn local governments and groups such as the Farm Bureau into the fray, too… “The Iowa Sierra Club was similarly quick to organize after Summit’s project was announced last year, putting much of its effort so far into educating and organizing property owners in the project’s path. Its lead organizer has been in contact with more than 1,000 landowners, and more than 100 have signed with an Omaha law firm to represent them as a group… “Jessica Mazour, the Sierra Club’s lead organizer on the project, said the type of conversations she’s having today are different from the ones she had around Dakota Access. While many people have strong political opinions about oil pipelines, they’re often less familiar with carbon capture pipelines.  “I think because people don’t know a lot about carbon pipelines, it gave us an opportunity to teach people about something they don’t have a preconceived notion about,” Mazour said.

Philadelphia Inquirer: Mariner East Pipeline has sparked a boom in fracked gas exports from Philly region
Andrew Maykuth, 5/8/22

“Nearly once a day last year, a large tanker sailed up the Delaware River and docked at Marcus Hook Terminal to take on a cargo of liquid fuel, produced mostly from the Marcellus and Utica Shale formations in Western Pennsylvania and neighboring states,” the Philadelphia Inquirer reports. “The fuels — propane, butane, and ethane — were destined for markets in Europe, the Caribbean, Asia, Africa, and South America, where they’re used for heating, motor fuel, and as raw material for petrochemical manufacturing. Almost all the products were piped into Marcus Hook via the controversial Mariner East Pipeline system, the fuel transportation network whose protracted construction was hugely disruptive along its 350-mile route but finally seems to be delivering on its promise as an economic engine… “Environmentalists have opposed the expansion of shale oil and gas production because of harmful climate impacts and believe exporting the products only prolongs the use of fossil fuels over alternatives. But supporters of fuel exports say they are vital to generating foreign exchange and jobs, and in some cases, displace dirtier fuel like coal… “About 90% of the 328 ships last year loaded with gas liquids on the Delaware River came from one location: the Marcus Hook Terminal, a former Sunoco refinery that shut down in 2011 and has been rebuilt by its new owner, Energy Transfer LP of Dallas, as a facility for processing, storing, and transloading gas liquids onto ships… “Few projects have caused as much uproar as Mariner East. Sunoco Pipeline, the Energy Transfer subsidiary that built the project, drew $24 million in fines from Pennsylvania regulators during construction, according to a tally by the PA Environment Digest blog. And last year Pennsylvania Attorney General Josh Shapiro announced a criminal indictment of Energy Transfer related to spills and leaks of drilling mud at nearly two dozen locations across Pennsylvania, including Marsh Creek State Park in Chester County… “McCrea, the Energy Transfer co-CEO, told analysts on Wednesday the company is looking for additional overseas buyers of natural gas liquids (NGLs), which could be shipped out of Marcus Hook or the company’s terminal in Nederland, Texas. More capacity could be achieved on the Mariner East system with the addition of more pumps, he said… “While most of the region’s exports of gas liquids flowed through Energy Transfer’s Marcus Hook facility, a second terminal in Gibbstown, Gloucester County, began exporting propane and butane last year. The Repauno Port and Rail Terminal, which is located on a former DuPont dynamite factory across the Delaware River from Philadelphia International Airport, loaded 30 vessels for export last year, according to the Maritime Exchange and Fortress Transportation & Infrastructure Investors LLC, which operates the terminal… “The Repauno site has been a major concern for environmental advocates, mostly because New Fortress wants to produce liquefied natural gas (LNG) at a proposed $800 million plant in northeastern Pennsylvania and transport the fuel by rail to Gibbstown.”

Williston Herald: PSC presses Bridger Pipeline on details for proposed 105,000 transmission line
Renée Jean, 5/7/22

“Bridger Pipeline faced a lot of questions during a public hearing for a 105,000 barrel per day transmission line it has proposed building from McKenzie County, North Dakota to Baker, Montana,” the Williston Herald reports. “The 145-mile pipeline would begin in Johnson’s Corner, which is near Watford City, and travel 80 miles to the Montana border, exiting the state in Golden Valley County. From there, the pipeline would be regulated by PHMSA, as Montana doesn’t generally have a pipeline siting process. One notable exception is if a portion of the line travels through state trust land. In that case, there would be an approval process through Montana State Land Board… “But Commissioners had a lot of questions particularly about geologic instability along the pipeline route, identified by the engineering firm that Bridger hired to further evaluate six areas that had historical landslide data that could not be immediately ruled out as a threat… “Commissioners also had lots of questions about the handling of Dakota skipjack habitat, a protected species that was spotted along the route during the environmental assessment phase… “LIUNA MN and ND Marketing Manager Kevin Pranis, testified that since the Dakota Access pipeline protest, LIUNA has decided it must be proactive about the integrity of not just the pipelines they themselves build, but others as well. “The integrity of pipelines is closely tied to the integrity of the industry and the ability for our members to do their jobs,” he said. Pipelines are the safest way to transport petroleum products, Pranis said, but every spill has become evidence against the industry as a whole. He recalled a quote from protesters during construction of Dakota Access and Keystone XL’s eventual abandonment that “every pipeline spills eventually.” “As everyone here knows, our industry is under attack and has been under attack for some years,” he said. “That has had a significant impact on our members, not only losing livelihood in cases where pipeline projects that were expected to move forward didn’t or were canceled midway through, but increasing and as everyone know there from the Dakota Access, physical threats to safety as a result of overheated actions on pipeline projects.”

Gothamist: National Grid’s pivot to ‘renewable’ natural gas would require more pipelines, keep producing carbon
ROSEMARY MISDARY, 5/6/22

“National Grid, one of the largest investor-owned utility companies in the world, unveiled a plan last month to wean New York off natural gas by 2050,” Gothamist reports. “The process would call for the utility to slowly transition to renewable natural gas, also known as biogas and biomethane… “But gas will continue to flow, and environmental experts say that the plan is not a solution that will help reduce global warming because the process still produces carbon emissions… “I see it as possibly filling in a small piece of the puzzle to reduce carbon intensity out in a relatively inexpensive way,” Ken Gillingham, an economics professor at the Yale School of the Environment, told Gothamist. “But that’s not going to solve the climate crisis. The heavy lifting and replacing fossil natural gas is going to have to come from electrifying, at least a high percentage of end uses that are currently using natural gas.” “…In regions where long distances separate pipelines and renewable natural gas sources, purification facilities will cost more than $20 per million BTU. Compare that against current liquid natural gas prices, which can be developed at a cost less than $4 per million BTU. So, transitioning to renewable natural gas could lead to increased energy prices for customers, if those costs aren’t otherwise absorbed. Another added expense comes from the green hydrogen. This fuel would also require upgrades to existing pipelines and infrastructure.”

WASHINGTON UPDATES

Politico: STORE THE CARBON 
Matthew Choi, 5/6/22

“The Energy Department kicked off new efforts to build out the country’s carbon storage capacity on Thursday, including a $2.24 billion initiative funded by the bipartisan infrastructure package to accelerate geologic carbon storage projects,” Politico reports. “DOE started the education phase of the Carbon Storage Assurance Facility Enterprise (CarbonSAFE) initiative, which would ultimately distribute funds to help push along CCS project development while factoring in community input to avoid overburdening disadvantaged areas. Each storage project would be capable of permanently holding at least 50 million metric tons of CO2.”

E&E News: Why EPA might make new gas plants catch carbon
Jean Chemnick, 5/9/22

“It has been seven years since EPA finalized a rule requiring new coal-fired power plants to capture and store a share of their carbon emissions,” E&E News reports. “Despite litigation and a proposed repeal by the Trump administration, it is still in place. Now EPA is preparing to demand that newly built natural gas-fired generators do more to limit their own emissions. And environmentalists hope the new rule, expected later this year, will also rely on an aggressive technology like carbon capture, utilization and storage, or CCUS, to deliver deep cuts in climate pollution. No gas-fired generators currently use that technology. A draft white paper that EPA released last month and is now taking public comment on lays out technical options for CO2 abatement at new gas power plants. Its section on CCUS cites a combined-cycle gas plant in Massachusetts that captured up to 95 percent of its CO2 for use in carbonated beverages — until it shuttered in 2005… “Industry advocates, including some who back the development of CCUS for gas plants, have suggested EPA would struggle to show that the technology is ready to be the basis of a rule… “Environmental attorneys maintain that the Clean Air Act is designed to promote the deployment of cutting-edge technologies that have the potential to deliver significant reductions in harmful pollution.,, “I think a lot of times opponents of CCS and advanced pollution controls try and move the bar and say that a technology isn’t demonstrated unless it’s on every street corner. But that’s not what the Clean Air Act contemplates. It’s forward-looking. It’s technology-forcing,” Jay Duffy, an attorney with the Clean Air Task Force, told E&E… “O’Boyle told E&E energy regulators should in effect have a tougher standard for the technologies they approve than EPA, because they should be anxious to protect customers from subsidizing stranded assets down the line. Gas with CCUS is not competitive with renewable energy, he argued.”

E&E News: NEPA energy reviews rely on flawed climate metric — report
Heather Richards, 5/6/22

“Federal agencies are applying a “broken” framework to determine the climate cost of approving large fossil fuel projects like coal ports and oil auctions, according to a report released this week by Earthjustice and the Stockholm Environment Institute,” E&E News reports. “The report argues that agencies like the Interior Department compare projects on an either-or basis: with the emissions associated with approving fossil fuels on one side and the emissions resulting from denying the project on the other. But the modeling associated with figuring out the emissions associated with not doing a project is tricky at best, involving international markets and hypotheticals, and often ignores how climate policy shifts markets over time, Jan Hasselman, a senior attorney with Earthjustice and one of the study’s authors, told E&E. “The problem with this approach is that it winds up that these huge fossil fuel investments that lock in decades of emissions wind up looking like net benefits. It’s a wrongheaded way to look at it.”

Politico: MALLORY ON THE HILL
Matthew Choi, 5/6/22

“White House Council on Environmental Quality Chair Brenda Mallory heads to the Senate next week for an oversight hearing at the Environment and Public Works Committee, where lawmakers will pore over the council’s work from the past year,” Politico reports. “CEQ lost some of its key environmental justice members this year, adding to fears among activists that the White House was struggling to uphold one of its key campaign priorities to address the pollution that afflicts low-income areas and communities of color. Shortly before EPW’s hearing announcement, CEQ revealed Jalonne White-Newsome would lead its EJ efforts, replacing Cecilia Martinez, who left in January. White-Newsome’s office will be responsible for determining which communities count as disadvantaged under the White House’s Justice40 initiative — and the screening tool that has drawn criticism for not taking into account race.”

Bloomberg: EPA Union Seeks Climate Emergency Declaration to Hire More Staff
5/5/22

“The EPA’s biggest union, signaling its dissatisfaction with the White House’s level of action on climate, will ask the Biden administration to declare a national climate emergency and take other ambitious steps on the environment,” Bloomberg reports. “The declaration of a national emergency would kick-start 123 statutory powers that aren’t otherwise available to the executive branch, according to the Brennan Center for Justice. Included among them is the hiring of more climate scientists, engineers, and lawyers at the EPA, a goal shared by both the American Federation of Government Employees Council 238 and the Biden administration. The request represents a marker for the American Federation of Government Employees Council 238 when it sits down with the Environmental Protection Agency on June 13 to negotiate a new contract. “Maybe it’s a move-the-goalposts type of idea,” Joyce Howell, chief negotiator for the union and an attorney in the EPA’s Philadelphia office, told Bloomberg. “There’s a window of opportunity for significant advances in the federal labor movement right now because of our president, so why not swing for the fences?” A national climate emergency proposal is a popular idea among progressive Democrats. Among them is Senate Majority Leader Charles Schumer (D-N.Y.), who called on Biden to make such a declaration soon after the president took office. But it has gained little traction. Rep. Earl Blumenauer (D-Ore.) introduced a bill (H.R. 794) in February 2021 that has drawn 53 Democratic cosponsors, but has languished since then.”

STATE UPDATES

City and State: New York’s once-booming oil industry and the risky wells it left behind
ILENA PENG AND JESSIE BLAESER, 5/9/22

“When Paul Plants and his business partner started their oil company in 1970, they never expected to profit from the fossil fuel industry’s decline. “It’s an industry that is – was – very important,” Plants said. “I’m very proud of our involvement in it,” City and State reports. “…Faced with both declining output and shifting opinions on oil and gas in New York roughly four decades later, Plants needed to pivot. Instead of drilling for oil, Plants & Goodwin began plugging abandoned oil wells throughout the Northeast. Plants’ son and grandson took over the business and continue that work today. Allegany County, the former seat of oil production in New York, now has more abandoned and unplugged wells than active wells. Left open and unchecked, the Environmental Defense Fund said unplugged wells can cause air pollution, contaminate groundwater and release greenhouse gases. Despite up to $70 million available to New York to plug abandoned wells from President Joe Biden’s 2021 infrastructure package, oil companies and environmental advocates said the state’s resources fall far short of the need… “It grieves me a little bit that people who made lots of money in the early days did not take care of the wells and (plug) them,” Plants said. “But it’s vitally important that it gets done.” “…Today, New York’s oil production is almost negligible. Oil output in New York actually increased from 2018 to 2019, but the state produced only about 277,000 barrels of oil in 2019. By comparison, Texas produced over 1.4 billion barrels of oil from September 2018 to August 2019.”

EXTRACTION

NPR: The good times are rolling for Big Oil. 3 things to know about their surging profits
Brittany Cronin, 5/7/22

“It’s a good time to be an oil company – and an even better time to be an oil investor,” NPR reports. “Over the past couple of weeks, Big Oil companies have reported a surge in profits for the first three months of the year… “But that boom is bound to raise scrutiny from Democrats who believe Big Oil’s profits are coming at the expense of American consumers saddled with high prices at the gas pump… “The bottom line is that the industry is generating the highest free cash flow certainly in the 25 years that I’ve looked at this business,” Doug Leggate, who runs the oil and gas equity research team for Bank of America, told NPR, referring to a key metric for companies… “Exxon plans to buy back up to $30 billion in shares by the end of next year, triple what it had initially projected. Other companies, including BP and Chevron, are also returning money to shareholders… “Big Oil CEOs were hauled into a Congressional hearing last month, where House Democrats accused them of gouging consumers by sharply raising gasoline prices, which the executives firmly denied… “At the same time, Big Oil is also under pressure to increase production by the Biden administration, which is looking for a solution to high gasoline prices. Oil companies are increasing production, but they are doing so measuredly, given the pressure they are under from investors and given that they are constrained by supply chain and staffing challenges.”

Reuters: Explainer: Why are U.S. natural gas prices soaring?
5/6/22

“ U.S. natural gas prices are surging, with the benchmark futures contract rising to a 13-year high of $8.74 per million British thermal units, at a time when that fuel’s price tends to dip due to lack of demand in the spring,” Reuters reports. “But analysts tell Reuters  a number of factors have combined to boost the cost of gas, which has risen about 90% since the beginning of March. Here is what is happening: Simply put, it is hotter than normal in many parts of the United States… “The gas market is getting caught up in the frenzy that has hit the oil, fuel and coal markets as countries scramble to make sure they have enough reliable energy in the wake of Russia’s invasion of Ukraine. Russia is the world’s biggest exporter of crude and fuel and is also the biggest exporter of natural gas. With fewer exports of Russian energy, countries in Europe and elsewhere are trying to secure supply. It is that factor that has boosted European benchmarks to several multiples of the U.S. price, as gas futures at the Dutch Title Transfer Facility (TTF) were at $33 on Thursday… “However, export demand is rising, and even though the United States cannot add capacity at a moment’s notice, expectations of a continued call on that demand are boosting the price of natural gas.”

Reuters: Shell posts record quarterly profit, lifted by energy price surge
By Ron Bousso and Shadia Nasralla, 5/5/22

“Shell on Thursday reported a record first-quarter profit of $9.13 billion, boosted by higher oil and gas prices, stellar refining profits and the strong performance of its trading division,” Reuters reports. “The last of the energy majors to report results, Shell joins sector rivals, including BP (BP.L) and TotalEnergies (TTEF.PA) in making big profits from the commodity price volatility stoked by Russia’s invasion of Ukraine that began on Feb. 24… “The size of energy companies’s profits have led to calls from Britain’s opposition Labour Party to levy a windfall tax to support people struggling to pay their energy bills because of the surge in prices. The ruling Conservatives have rejected the idea, saying it would discourage companies from investing profits in the transition to lower carbon energy. Meanwhile, Shell is providing incentives for shareholders. It said its dividend payments and share repurchases reached $5.4 billion in the quarter, part of its plan to buy back $8.5 billion shares in the first half of the year. Its dividend rose to 25 cents per share as planned. In the current environment, it said it expects shareholder distributions to exceed 30% of cashflow in the second half.”

Reuters: Suncor CEO Little faces scrutiny after activist Elliott takes aim
By Nia Williams and Svea Herbst-Bayliss, 5/8/22

“Three months ago Mark Little, the chief executive of Canadian oil and gas major Suncor Energy (SU.TO), issued a mea culpa,” Reuters reports. “In January two trucks had crashed at an oil sands mine in northern Alberta, killing one person. This raised the number of on-the-job fatalities at Suncor since 2014 to 12, by far the worst safety record among its Canadian peers. “I own this,” Little told an earnings call in February. Now those words are coming back to haunt him. The accident in January was the latest in a string of operational incidents at Suncor sites, and came on top of investor dissatisfaction with a major dividend cut in 2020. As Suncor shares lagged its peers, U.S. investment firm Elliott Management saw an opportunity and built a 3.4% stake. Last month the hedge fund said it would like to see a handful of new directors join the company’s board, as well as management and strategic reviews.Elliott, which is known for pushing companies to improve operations, is expected to meet privately with Suncor next week, sources said. Elliott’s move is bringing scrutiny over Little’s performance as CEO, a role he took in 2019 after serving as chief operating officer since December 2017. “My feeling is Bay Street isn’t going to give (Suncor) the benefit of the doubt because it’s been a few years of missteps,” Laura Lau, chief investment officer at Brompton Group, a Suncor shareholder, told Reuters. “Will they (shareholders) give Mark Little time? I don’t know. There are more questions about whether he is the right guy going forward,” Lau told Reuters. In its letter to Suncor, Elliott did not refer to Little by name but said the board must be responsible for having a management team in place that can deliver excellence in operating and safety performance.”

CLIMATE FINANCE

Wall Street Journal: Billionaire George Kaiser’s Bank Drills Deeper Into the Oil Patch
Vipal Monga, 5/7/22

“Banks all over the U.S. and around the world have curtailed lending to the U.S. oil-and-gas sector. BOK Financial Corp. has doubled down,” the Wall Street Journal reports. “The Tulsa, Okla.-based bank holding company for the Bank of Albuquerque, Bank of Oklahoma and Bank of Texas, along with other financial-services companies, is majority-owned by billionaire oilman George Kaiser. It has been snatching market share from big European banks and local rivals that retreated from the industry even as oil prices leapt from historic lows to near-historic highs in less than two years. “We’re demonstrating that we can be very aggressive,” Stacy Kymes, BOK’s chief executive officer, told the Journal. “Some have struggled with underwriting and managing the credit risk.” “…BOK was bookrunner on $2 billion in loans to U.S. oil-and-gas companies during the first quarter of this year, representing 6.7% of lending in the sector, according to data provider Refinitiv. The bank ranked fifth overall, behind national giants Wells Fargo & Co., Bank of America Corp., Citigroup Inc. , and JPMorgan Chase & Co. During the first quarter, the lender’s energy-loan balances increased by $191 million to $3.2 billion. Energy loans make up about 15% of the bank’s total book… “This year, high oil prices have boosted energy companies’ cash flows, so they don’t need to borrow as much to run their businesses. Many U.S. producers have said they don’t intend to increase production, even with high oil prices, which is limiting their need for capital. Banks have also been reducing oil-and-gas lending to reduce their exposure to greenhouse gas-emitting industries. Firms such as HSBC Holdings PLC, Barclays PLC and Bank of Montreal have said they are cutting their exposure to the energy sector as part of broader climate-change goals. Other lenders have been put off by an extremely volatile oil market that has made it difficult for them to assess risk.”

Houston Chronicle: Capital for oil, gas producers were extremely scarce a year ago. Today, the outlook has changed.
Daniel Allison is an energy and global finance lawyer in the Houston office of Sidley Austin LLP, 5/9/22

“As recently as a year ago, sources of capital for U.S. oil and gas producers were extremely scarce and only came at a premium. Today, with oil prices mostly hovering around $100-per-barrel, the outlook is dramatically different. Now producers have many options for raising the money they need to ramp up operations or refinance to reduce debt payments,” Daniel Allison writes for the Houston Chronicle. “…Among new financing sources that have emerged during the challenging times of the last few years for oil and gas producers are credit funds, which are lenders but not typical big box banks. These lenders tend to focus on more specific company profiles rather than try to service entire sectors… “Another new source of capital involves securitizations of producing wells. By bundling many different oil and gas producing assets and hedging price exposure, these structures can achieve investment-grade ratings for notes secured by oil and gas assets, and they attract a new investor class… “One common theme, however, both from traditional sources of capital and from new entrants has been a focus on free cash flow — cash after expenses  and a demand for more discipline in producing excess cash. Independent producers have heard the message and clearly understood the assignment. Many public companies have cleaned up their balance sheets to generate more cash, and, in many cases, to pay shareholder dividends… “These non-traditional lenders continue to be opportunistic, and securitization structures are becoming more common and easier to execute. At the same time, investments in public oil and gas companies have been performing well the past few quarters, driven by sound fundamentals and rising prices. For the moment, however brief, the outlook seems far better than it has in a few years.

OPINION

The Globe: Guest Editorial: Landowners have much to consider with carbon pipeline plan
Larry Liepold, Okabena, 5/8/22

“Early spring is the best time to appreciate the land; winter has snow, while late spring through late fall has transforming vegetive color. It is not our land; we are merely custodians providing for our Lord’s people using the latest conservational practices available,” Larry Liepold writes in The Globe. “…Recently, full-page advertisements of Summit Carbon Solutions (Summit) have been printed in local papers announcing their plans to build the world’s largest carbon sequestering project… “Before any signatures happen, I feel obligated to tell our fellow neighbors the conversations around my kitchen table. Setting aside my position of carbon sequestration limiting greenhouse gas emissions, below is a glimpse of my ask pending I allow Summit to trench a pipe in my ground: 1. Community Endowment Fund greater than $1 million; 2. Funding towards land-grant university research studying the environmental impacts of carbon sequestration and its safety; 3. Landowner to be placed on the general liability policy as a co-insured and be notified if policy is nearing $1 million remaining of coverage; 4. Approved risk mitigation plan/leak detection plan… “Just as land joins each parcel of ground passed from generations, we as farmers and landowners must unite. Speak to your neighbors, split legal bills, share information, and create the best outcome as possible for the community and future generations. There is a united group of landowners defending our rights. If you are a landowner in the path of the proposed pipeline anywhere in Minnesota and would like more information please contact me at (507) 360-7862.”

The McDonough County Voice: Resident opposed to multi-state CO2 pipeline
Marilyn Shelley, Colchester, IL, 5/6/22

“Driving thru rural McDonough County, one can view “No Easement, CO2 Carbon Pipelines, No Eminent Domain” signs,” Marilyn Shelley writes in the The McDonough County Voice. “…Ruptures do happen! In 2020, a break occurred near Satartia, Mississippi. Dozens of people were sickened by the escaping CO2. Few regulations exist for CO2 pipelines. This private company has proposed constructing a pipeline going thru farm land. Productive land, pastures, woods inhabited with wildlife and birds, and residences would be affected.  Farm land issues include lower crop farm yields, damaged top soil, and severed drainage tiles. All of these issues will reduce property values… “While this company is receiving a huge tax credit (45Q) and funding from the Federal Government, they would give landowners a token payment for permanent usage of their property. More information and videos can be found at Coalition to Stop CO2 Pipelines: https://noillinoisco2pipelines.org” 

The Hill: Déjà vu on climate action
William S. Becker is a former U.S. Department of Energy central regional director who administered energy efficiency and renewable energy technologies programs, and he also served as special assistant to the department’s assistant secretary of energy efficiency and renewable energy, 5/6/22

“Champions of federal leadership on global climate change are probably experiencing déjà vu right now,” William S. Becker writes for The Hill. “They may be flashing back to Febr.13, 2013, when President Barack Obama delivered that year’s State of the Union address. Frustrated at Congress’s refusal to do anything about the global-warming emergency, Obama said, “If Congress won’t act soon to protect future generations, I will. I will direct my cabinet to come up with executive actions we can take, now and in the future, to reduce pollution, prepare our communities for the consequences of climate change, and speed the transition to more sustainable sources of energy.” “…Now, President Joe Biden must be the “climate president.” He sent Congress the most aggressive proposal yet — a $555 billion package — for the United States to invest in clean energy. But with Congress failing to act again, it’s time for Biden to use his authority aggressively in ways that make it difficult for a future president to undo his directives, as President Donald Trump did to Obama’s. “…The filibuster and the hold are supposed to prevent the “tyranny of the majority” in Congress. But instead, they invite the tyranny of the minority, even a minority of one — and even when sabotaging the legislative process adversely affects the futures of 330 million Americans (and in the case of climate change, 8 billion humans and 9 million species). To do its job properly, the Senate must get rid of both rules, or at least allow exceptions for emergencies… “Meantime, Biden should begin issuing executive orders and initiating rulemakings to do what Congress has failed to do.”

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