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EXTRACTED: Daily News Clips 6/16/22

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

By Mark Hefflinger

News Clips June 16, 2022

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PIPELINE NEWS

  • Mlive.com: St. Marys River oil spill highlights bigger Line 5 risk to Great Lakes, critics say

  • The Gazette: Navigator CO2 pipeline would drop Linn County from new proposed route

  • Colorado Politics: State Supreme Court agrees Weld County gas pipeline is not a public utility

  • Williston Herald: Bridger’s Bakken pipeline has its permits

WASHINGTON UPDATES

  • E&E News: Why Biden’s refinery push may run into trouble

  • Reuters: U.S. oil lobby pushes Biden to roll back fossil fuel curbs

  • Press release: ExxonMobil statement regarding President Biden Letter to Oil Industry

  • Politico: MORE LEASES, MORE PROBLEMS

  • CNN: Federal watchdog found oil and gas company likely defrauded government amid agency missteps

STATE UPDATES

  • E&E News: Oil-State Governors Offer Panel Different Paths On Methane 

EXTRACTION

CLIMATE FINANCE

  • Bloomberg: It’s Not ESG Driving Big Oil Away From Its Biggest Reserves

OPINION

  • The Hill: We will soon find out if FERC is serious about climate and environmental justice

  • The Hill: The importance of local government in making carbon removal a public service

PIPELINE NEWS

Mlive.com: St. Marys River oil spill highlights bigger Line 5 risk to Great Lakes, critics say
Sheri McWhirter, 6/14/22

“Environmental advocates argue the gear oil spill last week in St. Marys River amounts to a small taste of the potential ecological catastrophe that could strike the heart of the Great Lakes should a controversial underwater petrochemical pipeline rupture,” Mlive.com reports. “On Monday, public health authorities in Michigan and Canada had not yet cleared St. Marys River water for drinking or even body contact following a 5,300-gallon gear oil spill June 9 from the Algoma Steel mill in Sault Ste. Marie, Ontario. U.S Coast Guard officials said the oil spilled into the river was “non-recoverable,” while local freshwater ecosystem researchers said a sensor installed downstream has not detected any oil washing up on land… “Meanwhile, critics of the underwater section of Enbridge’s Line 5 pipeline are pointing to this oil spill in the river that connects Lake Superior to Lake Huron as a precursor of what they say is the ongoing multi-billion-dollar risk the nearly 70-year-old infrastructure presents to the Great Lakes… “We will not know for a long time about the damage to any of the fisheries and you know the benthic environment of those waters in the Soo,” Liz Kirkwood, executive director at Traverse City-based nonprofit For Love of Water (FLOW) which advocates for shutting down Line 5, told Mlive… “The oil being “non-recoverable” in the St. Marys River last week put longtime Line 5 critics on tenterhooks. “This is the latest event that proves what’s at risk and how little we can do once a spill occurs. If Line 5 breaks, very little oil will be recoverable. Drinking water will be cut off for many communities. Critical wildlife habitat gone for generations. The Great Lakes economy destroyed for years,” Beth Wallace, Great Lakes campaigns manager for the nonprofit National Wildlife Federation, told Mlive… “Critics argue the gravity of the accelerating climate crisis means investment in fossil fuel industry infrastructure is impractical, particularly given the earliest a tunnel could be completed is 2028. Enbridge argues the tunnel is part of its net-zero emissions plan.”

The Gazette: Navigator CO2 pipeline would drop Linn County from new proposed route
Erin Jordan, 6/15/22

“The Navigator Heartland Greenway carbon dioxide pipeline would no longer go through Linn County under a new route proposed by the company,” The Gazette reports. “The proposed 1,300-mile underground pipeline no longer would go through Linn, Benton, Cedar, Poweshiek and Clinton counties as proposed last year, but would include a new route in Bremer, Fayette, Buchanan and Delaware counties… “When ADM decided to partner with Wolf Carbon Solutions, Navigator no longer had reason to build a pipeline through Linn County, Burns-Thompson said. Instead, Navigator announced a deal earlier this month with POET, which operates 33 bioprocessing facilities across eight states, including Iowa. Navigator will collect CO2 from 18 POET plants in Iowa, Nebraska and South Dakota as part of the Heartland Greenway pipeline… “Changing the route means notifying a new set of Iowans the proposed pipeline would go through their property and holding a new set of public meetings. “We do anticipate we’ll have about a dozen new meetings we’ll have to do due to not only reworking the lateral in northeast Iowa, but there are a couple of counties where we need to shift out of our initial half-mile corridor,” Burns-Thompson said. “There are areas we have to completely go back to step one for those landowners.” For parts of the route that have stayed the same since last fall, Navigator will be moving forward with financial offers for voluntary easements in mid-July, she said. Burns-Thompson predicts the information meetings in each county will be held in August. The company hopes to file its permit application with the state utilities board before the end of the year… “Hundreds of Iowa landowners, county boards of supervisors and environmental groups have opposed use of eminent domain to force easements to build CO2 pipelines… “Critics are concerned about the safety of the pipelines and do not think private companies should get federal tax credits for what they consider unproven technology.”

Colorado Politics: State Supreme Court agrees Weld County gas pipeline is not a public utility
MICHAEL KARLIK, 6/15/22

“A 62-mile pipeline that gathers raw natural gas in Weld County and transports it to processing facilities is not a public utility under state law, the Colorado Supreme Court ruled on Monday,” Colorado Politics reports. “The justices heard the appeal of William C. Danks, who owns a farm in the county and filed his original complaint with the Public Utilities Commission. The core issue revolved around whether the state’s utility-regulating body holds jurisdiction over the line in question… “But after a series of decisions against Danks, the state’s highest court weighed in, agreeing that state law does not classify the gas-gathering “Grand Parkway” — as DCP’s pipeline in Weld County is known — as a public utility that the PUC can regulate. “My sole interest is: Weld County, you’ve got an oil industry that’s a Fortune 500 company and you’ve taken advantage of the landowners out there that have no power against this monopoly,” Danks, who represented himself in the case, told the justices during oral arguments in April… “The Grand Parkway and related lines were “upstream” systems, collecting raw gas from individual wellheads and sending it primarily to DCP-operated facilities, which in turn remove impurities and convert the product into useable gas. No consumers benefit from the upstream line, only from “downstream” distribution infrastructure. DCP has ownership of the vast majority of gas in the upstream line, and transports almost all of it to its own processing plants. The PUC concluded the Grand Parkway, from wellhead to processing plant, is not a public utility. Consequently, it dismissed Danks’ complaint. At the same time, the commission advised its staff to investigate whether the downstream infrastructure implicated the PUC’s regulatory powers, and permitted Danks to raise future issues on that subject… “In a June 13 opinion, Justice Richard L. Gabriel chided the PUC for muddying Danks’ complaint with its segue into downstream pipelines but otherwise affirmed the prior determination that the upstream gas-gathering line is not a public utility.”

Williston Herald: Bridger’s Bakken pipeline has its permits
Renée Jean, 6/15/22

“A 105,000 barrel per day pipeline proposed by Bridger Pipeline, a subsidiary of True Companies, has a thumbs up from the North Dakota Public Service Commission,” the Williston Herald reports. “In approving Bridgers Bakken pipeline project, Commissioners said the pipeline’s route is important for Bakken crude, particularly given the high demand for petroleum products right now throughout the country. They also noted that the company has taken steps to address its past spill record, installing a two-part monitoring system and implementing new training protocols for employees to try to prevent any future problems. Bridger and sister company Belle Fourche are both facing litigation related to oil spills in Montana and North Dakota respectively. Bridger pipeline was for the 2015 oil spill that released an estimated 758 barrels of oil into the Yellowstone River. The spill was caused by a weld that split open, allowing oil to leak into the river 7 miles above Glendale… “Belle Fourche, meanwhile, owned and operated a pipeline that ruptured during a landslide in 2016, leaking 4,200 barrels of oil into a hillside, some of which found its way into the Ash Creek, a tributary to the Little Missouri… “The Bakken Pipeline will initially carry up to 105,000 barrels of crude oil per day from North Dakota to Baker, Montana. From there, it will head to Wyoming for further marketing and transport. The pipeline can be expanded to as much as 250,000 barrels per day, and will be an important pipeline alternative for taking crude oil West, instead of using truck and rail options, Bridger wrote in its application.”

WASHINGTON UPDATES

E&E News: Why Biden’s refinery push may run into trouble
Mike Lee, 6/16/22

President Joe Biden raised the stakes in his campaign against high fuel prices yesterday, calling on U.S. refiners to cut their profit margins and help consumers who are struggling with energy costs to pay their bills,” E&E News reports. “The White House also suggested the president could use “all reasonable and appropriate federal government tools” to increase refining capacity in order to get record gasoline prices down, including the Defense Production Act to order refiners to bring some of their shuttered plants back online. “We’re saying that the president has used it before, and he’s willing to do that again,” White House spokesperson Karine Jean-Pierre said at a briefing when asked about the Cold War-era law and whether the president would use it to increase capacity. “We know where to put the blame: on the war. But oil companies, they have — oil refineries, they have a responsibility too. What they have been doing is taking advantage of the war,” Jean-Pierre said. But analysts and oil-price watchers told E&E there’s little the Biden administration — or the industry itself — can do to cut into the high profit margins at refiners. The lingering effects of the Covid-19 pandemic and the Russian war in Ukraine are likely to last into next year, they say… “As a result, the remaining refineries in the U.S. are running at more than 90 percent of their capacity and reaping record profits… “But reopening refineries will be a heavy lift. It would cost hundreds of millions of dollars for each site, and it would take months, John Auers, a refinery consultant at Turner, Mason & Co., told E&E… “And even if more refineries open, retail fuel prices won’t fall unless there’s more oil production, Somers and Thompson wrote, reviewing their long-standing complaints that the Biden administration doesn’t do enough to promote domestic energy.”

Reuters: U.S. oil lobby pushes Biden to roll back fossil fuel curbs
6/14/22

“The American Petroleum Institute, the top U.S. oil lobby organization, on Tuesday urged President Joe Biden’s administration to lift a slew of restrictions on fossil fuel development to help ease soaring energy prices,” Reuters reports. “The request underscores an uncomfortable dilemma for the Biden administration as it seeks to follow through on its promises to combat climate change while also battling to curb rampant inflation. Oil prices have surged more than 70% since late last year as global demand rebounds from the depths of the COVID-19 pandemic and as trade flows are disrupted by punitive sanctions imposed by the United States and Europe on major supplier Russia since its invasion of Ukraine. The jump has contributed to a record surge in U.S. gasoline prices to around $5 a gallon, part of a broad wave of rising consumer prices that threaten Biden’s fellow Democrats heading into the November mid-term elections. “This combination of factors and events leaves us in the situation we face today. Namely, the most consequential energy crisis since the 1970s,” API President Mike Sommers wrote in a letter addressed to Biden and dated Tuesday, referring to the Arab oil embargo. “Fortunately, the United States benefits from an abundance of oil and natural gas resources and has developed cutting-edge technologies to be the world’s energy leader.” The letter included a 10-point policy wish list from the oil industry, which included lifting restrictions on federal oil and gas lease sales, speeding permitting for fossil fuel projects, and rolling back proposals for increased climate disclosure.”

Press release: ExxonMobil statement regarding President Biden Letter to Oil Industry
6/15/22

“ExxonMobil today released the following statement in response to a letter from President Biden: We have been in regular contact with the administration to update the President and his staff on how ExxonMobil has been investing more than any other company to develop U.S. oil and gas supplies. This includes investments in the U.S. of more than $50 billion over the past five years, resulting in an almost 50% increase in our U.S. production of oil during this period. Globally, we’ve invested double what we’ve earned over the past five years — $118 billion on new oil and gas supplies compared to net income of $55 billion. This is a reflection of the company’s long-term growth strategy, and our commitment to continuously invest to meet society’s demand for our products. Specific to refining capacity in the U.S., we’ve been investing through the downturn to increase refining capacity to process U.S. light crude by about 250,000 barrels per day – the equivalent of adding a new medium-sized refinery. We kept investing even during the pandemic, when we lost more than $20 billion and had to borrow more than $30 billion to maintain investment to increase capacity to be ready for post-pandemic demand. In the short term, the U.S. government could enact measures often used in emergencies following hurricanes or other supply disruptions — such as waivers of Jones Act provisions and some fuel specifications to increase supplies. Longer term, government can promote investment through clear and consistent policy that supports U.S. resource development, such as regular and predictable lease sales, as well as streamlined regulatory approval and support for infrastructure such as pipelines.”

Politico: MORE LEASES, MORE PROBLEMS
Matthew Choi, 6/15/22

“Republicans are calling on the Biden administration to expand federal oil and gas leasing to bring more supply to market. But environmental groups retort that a lot of the remaining land for lease sales doesn’t have much potential for oil and gas development,” Politico reports. “The National Wildlife Federation, Trout Unlimited and Rocky Mountain Wild released a storymap Tuesday showing the wildlife at risk from federal oil and gas leases on lands with low production potential, including diversion of resources for conservation and recreation.More than half of leases sold since 2012 are on lands with little to no oil and gas potential, the groups write, citing a 2021 GAO report that “the most attractive federal lands were already leased and that the remaining federal lands had lower development potential.”

CNN: Federal watchdog found oil and gas company likely defrauded government amid agency missteps
Ella Nilsen, 6/15/22

“A federal watchdog has found that for years, the Interior Department’s safety and enforcement branch was unaware of an oil and gas company that regularly vented and flared a potent planet-warming gas at levels exceeding the department’s own requirements,” CNN reports. “Interior’s Office of the Inspector General found that an energy company operating in the Gulf of Mexico — which it declined to name — hid its regulatory violations from the government, resulting in the venting of millions of cubic feet of methane above the federal limit, and the loss of hundreds of thousands of dollars in oil and gas royalty payments to the government. Officials from the Bureau of Safety and Environmental Enforcement also told the OIG during its investigation that they have missed venting and flaring that exceeds the government’s limit in their yearly inspections of oil and gas companies.”

STATE UPDATES

E&E News: Oil-State Governors Offer Panel Different Paths On Methane 
Heather Richards, 6/15/22

“Two governors from states with the highest fossil fuel production from federal minerals championed their efforts yesterday to rein in methane emissions,” E&E News reports. “At a hearing before the House Select Committee on the Climate Crisis, however, the state officials, one Republican and one Democrat, disagreed on whether the federal government should strengthen rules on oil and gas companies to curb releases of the powerful greenhouse gas. ‘Wyoming does not need additional layers of federal regulation to regulate methane emissions,’ Republican Gov. Mark Gordon of Wyoming, the largest natural gas producer from federal minerals, said, adding that such regulations are an ‘inhibitor to any kind of business.’ Gordon said his state’s oil industry has already faced challenges from the Biden administration’s interest in curbing the federal oil and gas program. He instead pointed to state-level rules, which in Wyoming vary by region, with high-pollution areas facing stricter standards. ‘Our regulatory process works and has buy-in from the Wyoming oil and gas industry,’ he said. New Mexico Democratic Gov. Michelle Lujan Grisham, whose state recently passed aggressive new standards to stem methane leaks, said New Mexico is ‘proof positive’ that industry and government can be part of a climate solution. ‘You can increase production, you can reduce emissions, you can innovate, you can create new jobs,’ she told lawmakers, noting the growth of in-state businesses to serve the methane mitigation services sector.”

EXTRACTION

Press release: Key Oil Sands Groups Join Forces Under Pathways Alliance Banner
6/15/22

“Canada’s major oil sands producers announced the combination of three existing industry groups, all focused on responsible development, into a single organization called the Pathways Alliance. The new organization incorporates the Oil Sands Pathways to Net Zero Alliance, launched in 2021, Canada’s Oil Sands Innovation Alliance (COSIA), created in 2012, and the Oil Sands Community Alliance (OSCA), created in 2013. “Having all three of these remarkable industry groups integrated into a more powerful and efficient organization, with combined leadership, will further amplify our collaborative efforts to advance responsible oil sands development and help make Canadian oil the most preferred barrel in the world,” said Dilling. “I’m honored to be a part of the team that will work with our member companies to demonstrate continued progress on our goals for responsible development, including achieving net zero greenhouse gas emissions (GHGs) from oil sands production.” The six member companies of the Pathways Alliance – Canadian Natural, Cenovus Energy, ConocoPhillips, Imperial, MEG, and Suncor Energy – operate about 95 percent of Canada’s oil sands production. A key focus of the new Pathways Alliance will be to continue the considerable work already underway to reduce GHGs from oil sands production by 22 million tons annually by 2030 and ultimately achieve its goal of net-zero emissions from oil sands production by 2050. Achieving the group’s goals will require multiple technology pathways, including a proposed carbon capture and storage network that will capture CO2 from oil sands facilities and transport it to a hub in the Cold Lake area of Alberta for safe and permanent underground storage.”

Wall Street Journal: Fracking Pioneer Harold Hamm Moves to Take Continental Resources Private
Collin Eaton and Chris Wack, 6/14/22

“Harold Hamm, the billionaire fracking pioneer who helped launch the U.S. shale boom, is looking to take Continental Resources Inc. private, offering about $4.3 billion in cash to buy the portion of the company’s shares he and his family don’t already own,” the Wall Street Journal reports. “Mr. Hamm, 76, and other members of his family collectively hold about 83% of Continental, the Oklahoma City-based oil producer he ran for decades as chief executive, fueling a shale-drilling bonanza in the Bakken Shale of North Dakota which is today one of the largest U.S. oil-producing regions.”

Houston Business Journal: Enbridge considers $256M solar energy project at Ingleside export terminal
Chris Mathews, 6/15/22

“The solar project, dubbed Project Keen, would be developed on land adjacent the Enbridge Ingleside Energy Center, which Enbridge acquired as part of a $3 billion deal last year,” the Houston Business Journal reports.

CLIMATE FINANCE

Bloomberg: It’s Not ESG Driving Big Oil Away From Its Biggest Reserves
David Fickling, 6/16/22

“At a time when crude prices are close to their highest levels in 14 years, Big Oil is turning its back on some of its biggest reserves,” David Fickling writes for Bloomberg. “BP Plc this week announced it would sell out of the Sunrise project, a Canadian tar sands joint venture that produces about 50,000 barrels a day. That can be chalked up as a victory for environmental campaigners who’ve sought to drive oil majors away from such projects. Equinor ASA sold out of a similar Canadian project last year, while Shell Plc and ConocoPhillips sold assets several years ago. Chevron Corp. and TotalEnergies SE also have projects that may be on the block. On paper, bitumen and oil sands deposits like those in Canada’s Athabasca region are some of the biggest reserves of petroleum anywhere on the planet. Venezuela’s Orinoco belt contains roughly the same amount of crude as Saudi Arabia… “Yet there’s always been an asterisk attached to the tar sands. While their reserves numbers seem enormous, their economics have always been dicey. If international oil companies are quitting them now, it’s not because of any attempt to clean up their image (BP, for instance, is taking an offshore oil project as part-payment to its partner Cenovus Energy Inc. for its Sunrise stake.) It’s because they can see through current high crude prices to a future where barrels are cheaper, and tar sands can no longer turn a reliable profit… “When energy consultancies produce a rundown of the most competitive projects, it’s tar sands (along with still-more marginal ones such as coal-to-liquids or gas-to-liquids) that typically occupy the costliest bit of the curve. When prices dip, the producers at the top start losing money first… “A circumspect oil producer, however, will worry not just about the state of demand in 2022, but where it will be in 2025, or 2030, or beyond. Seen through that lens, the problem with high-cost, long-life tar sands isn’t that they’re despoiling a pristine environment or pumping additional molecules of carbon dioxide into the atmosphere, but simply that their economics are too marginal.  If you’re bullish on the long-term prospects for crude demand, 2022’s price environment represents a great time to invest in the world’s biggest reserves. If you’re bearish, it represents a great time to sell out of them. It’s telling that international oil companies with a choice about where to dedicate their capital are choosing the latter.”

OPINION

The Hill: We will soon find out if FERC is serious about climate and environmental justice
Ramón Cruz is president of the Sierra Club. Ruth Santiago is a member of the White House Environmental Justice Advisory Council, 6/15/22

“In February, the obscure, but powerful, Federal Energy Regulatory Commission (FERC) adopted draft policy statements that would require the agency to consider foreseeable greenhouse gas emissions before approving proposed interstate gas pipelines or liquefied natural gas (LNG) terminals,” Ramón Cruz and Ruth Santiago write for The Hill. “These statements would also require consideration of the construction impacts of these projects on historically marginalized communities and communities of color that have long been ignored by FERC and by many other government agencies. The policies outlined in FERC’s draft documents are not only right, but have been mandated by a number of federal courts, including one ruling last summer that said FERC was wrong for not examining the climate and environmental justice impacts of two fracked gas export terminals proposed for the lower Rio Grande Valley in Texas. So, it is critical that FERC not succumb to pushback from the gas industry and its allies in Congress and make these court-backed rules final as soon as possible… “Historically, the commission seemingly had never met a gas pipeline or an LNG terminal that it didn’t like. This was the case regardless of local impacts, regardless of whether the facilities were necessary and regardless of the extent to which the facilities would increase greenhouse gas emissions for many decades to come. FERC’s record on these issues was so awful that it was repeatedly admonished in court. We had hoped that swift and permanent approval of the policy statements would at least indicate a modest, but positive shift in FERC’s stance on the impacts of gas infrastructure projects on the land and communities surrounding them… “Unfortunately, even that modest shift is now in jeopardy. Pushback from gas industry allies regarding the proposed policy changes was intense. The Wall Street Journal editorial board also criticized Phillips and two of his FERC colleagues immediately after they made their decision in February… “There is still time for FERC to defy this political pressure and demonstrate that they are climate and environmental justice champions. They can’t possibly do so unless they take a first step by finalizing the two gas policy statements as soon as possible.”

The Hill: The importance of local government in making carbon removal a public service
Susie Strife, Ph.D., is the director of Sustainability, Climate Action and Resilience at Boulder County, 6/15/22

“I remain an optimistic person, despite having experienced the horrors of the climate crisis in my backyard,” Susie Strife writes for The Hill. “…In the process, cities, counties and states are uniquely positioned to help scale carbon dioxide removal (CDR) responsibly and provide a blueprint for federal action… “What we do locally is a drop in the bucket in terms of CDR deployment, but if we band together and get other local governments engaged, we can have an outsized impact. In this spirit, Boulder County teamed up with the City of Flagstaff to create the Four Corners Carbon Coalition to shape our own commitments to accelerate CDR. This coalition, representing cities and counties in Arizona, Colorado, New Mexico and Utah allows us to punch above our weight and drive rapid progress on CDR… “This is achieved through a multitude of carbon absorbers ranging from kelp, soils and trees, to minerals that bind with atmospheric carbon dioxide, as well as machines that pull carbon pollution out of the air and either pump it underground for indefinite storage safely or utilize it  in durable products like concrete… “As we stretch our impact by not going at it alone, climate-forward local governments all over the U.S. can combine knowledge, ambition and assets to realize CDR capacity that would be too costly for any community to do alone. As CDR ascends, so do economic development and job creation opportunities that will benefit communities. In fact, carbon removal could be delivered like other essential local services such as wastewater treatment, recycling, trash removal and street cleaning.”

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