EXTRACTED: Daily News Clips 12/12/22
PIPELINE NEWS
Reuters: TC Energy says has not found cause of Keystone oil pipeline leak
Reuters: Keystone spill prompts scrutiny of permit allowing pipeline to run faster
NBC News: In Kansas, crews contain largest-yet breach of Keystone Pipeline
NPR: Kansas oil spill is Keystone pipeline's biggest ever, according to federal data
Nebraska Public Media: Watch: Drone footage reveals extent of Keystone Pipeline oil spill
Reuters: Major oil pipeline outage to hit U.S. stockpiles, refinery supplies
Nebraska Public Media: Couple react to Keystone oil spill on their land
Ag Update: Keystone Pipeline rupture leaves cattle pasture covered in crude
Reuters: Kansas residents hold their nose as crews mop up massive US oil spill
Lincoln Journal Star: Keystone spill in Kansas the largest in pipeline's 11-year history
Press release: TC Energy actively responding to oil incident
E&E News: Q&A: Summit exec on status, safety of Midwest CO2 pipeline
The Food & Environment Reporting Network: CO2 pipeline company plays hardball as Iowa counties fight back
WASHINGTON UPDATES
Bloomberg: Manchin Says GOP ‘Mad At Me’ In Lamenting Permitting Opposition
E&E News: Takeaways from the Democrats’ Big Oil investigation
The Hill: Biden adviser calls investor refusal to ramp up shale drilling ‘un-American’
Reuters: Big Oil Does Little to Act On Climate Despite Vows
STATE UPDATES
Des Moines Register: Explosion, fire in Marengo fuel plant leads to injuries and evacuation
High Country News: Could Alaska help lessen international dependence on Russian oil?
Colorado Sun: Colorado requires drillers assess “cumulative impacts”of oil and gas wells. Does it make a difference?
Searchlight NM: Magnate opus: The power plays of Harvey Yates
EXTRACTION
The Hill: JPMorgan Chase CEO warns oil, gas issues will persist for years because of Russia-Ukraine war
Politico: Giant renewable hydrogen plant planned in Texas
OPINION
Pipeline Fighters Hub: The Keystone Pipeline Is A Lemon. It Just Leaked Again for the 22nd Time
The Hill: Progressives should have supported Manchin’s permitting reforms: Here’s why
New York Times: Indian Country Needs Money to Protect Its Wildlife Heritage. Congress Must Help.
The Hill: Banks for the planet: The future of financing
PIPELINE NEWS
Reuters: TC Energy says has not found cause of Keystone oil pipeline leak
12/11/22
“Canada's TC Energy (TRP.TO) said on Sunday it has not yet determined the cause of the Keystone oil pipeline leak last week in the United States, while also not giving a timeline as to when the pipeline will resume operation,” Reuters reports. “TC shut the pipeline after more than 14,000 barrels of crude oil spilled into a creek in Kansas on Wednesday, making it one of the largest U.S. crude spills in nearly a decade. "Our teams continue to actively investigate the cause of the incident. We have not confirmed a timeline for re-start and will only resume service when it is safe to do so, and with the approval of the regulator," TC said in an update posted to its website. The pipeline operator said that it has more than 250 people working on the leak, including third-party environmental specialists, adding that it is continuously monitoring air quality and presently there are no indications of adverse health or public concerns.”
Reuters: Keystone spill prompts scrutiny of permit allowing pipeline to run faster
12/9/22
“The largest oil spill in the 12-year history of TC Energy Corp’s Keystone pipeline, discovered late Wednesday, raises questions about special permission it received five years ago to run at higher pressure, making it unique among U.S. oil pipelines,” Reuters reports. “Keystone is responsible for three spills of at least several thousand barrels in the last five years, all of which have occurred since Keystone was allowed to run the line at higher rates to move more oil. This week’s spill of 14,000 barrels in Kansas is sure to raise alarms over future pipeline development, as U.S. regulators had already increased scrutiny of pipeline construction due to previous Keystone spills in 2017 and 2019… “Bill Caram, executive director of the non-profit watchdog Pipeline Safety Trust, questioned whether that permit may be behind the run of serious incidents that followed. “Even when you normalize for incidents per mile and for barrels spilled by throughput, we’re still seeing more failures here than the industry standard,” Caram told Reuters. TC Energy did not respond to requests for comment… “After the 2019 spill, the GAO commissioned a report of the line’s problems, which has caused pipeline regulators to more heavily scrutinize the construction process. The GAO report noted that PHMSA allowed TC Energy to start operating the line at 80% of what’s known as specified minimum yield strength – the point at which steel pipes will start to deform. No other U.S. crude line can operate at more than 72% of that level. “I think a lot of scrutiny is going to be placed on the special permit,” Jane Kleeb, founder of Bold Alliance, an advocacy group that fought Keystone XL, told Reuters. “That high pressure is causing more wear and tear.” In a June 2021 letter responding to the GAO report, TC Executive Vice-President Leslie Kass said PHMSA’s 51 conditions on TC “offset any potential risk” associated with running Keystone at a higher stress level, and the GAO report notes that several safety consultants made similar assessments… “Running at higher rates is worth investigating along with possible operator error or material failures, Dennis McConaghy, who retired from TC Energy as executive vice-president of corporate development in 2014, when it was known as TransCanada, told Reuters… “Due to activist opposition to new pipeline construction, operators have every reason to try to move as much oil as possible through existing lines, TC Energy’s McConaghy told Reuters…“The economic driving force to pushing that envelope is always going to be there,” McConaghy told Reuters. “It’s up to PHMSA to determine whether that is something that’s prudent.”
NBC News: In Kansas, crews contain largest-yet breach of Keystone Pipeline
Dennis Romero, 12/11/22
“The operator of the Keystone Pipeline System, which carries a form of crude oil from Canada to multiple states for refining, said over the weekend that its largest breach yet has been contained for now,” NBC News reports. “...Environmentalists have argued that the incidents come with such a pipeline and that they're not worth the convenience of more direct transportation for fossil fuel in a world coming to terms with global warming caused largely by burning it… "There is no such thing as a safe tar sands pipeline and this is another disaster that continues to prove we must put our climate and our communities first," Catherine Collentine of the Sierra Club said in a statement… “Alan K. Mayberry, an associate administrator at the Pipeline and Hazardous Materials Safety Administration, said in a letter to a TC Oil executive last week that the company is ordered to keep the affected segment offline… “Ahead of any restart, TC must reduce pressure to 80% of what it was right before the breach, the federal pipeline regulators said. The oil spilled as the company was conducting an analysis of the conveyance nearby by using an "in-line inspection tool," Mayberry wrote. "The ILI tool is currently downstream of the failure location," he wrote. "Respondent had bypassed the Hope, Kansas, pump station, the next station downstream, in preparation for the tool to pass when the failure occurred." Any possible cause-and-effect relationship wasn't clear. The letter also suggests the failure involved "failed pipe joints." “...During the tenure of President George W. Bush, TC Oil was granted special permission to use higher-than-standard pressure along the Cushing Extension to move the thick form of crude from Canada. Bill Caram, the executive director of the nonprofit Pipeline Safety Trust, told The Associated Press that the number of Keystone spills, breaches and accidents since then should prompt a reconsideration of allowing higher pressure. "I think it’s time to question that," he said.”
NPR: Kansas oil spill is Keystone pipeline's biggest ever, according to federal data
12/10/22
“A ruptured pipe dumped enough oil this week into a northeastern Kansas creek to nearly fill an Olympic-sized swimming pool, becoming the largest onshore crude pipeline spill in nine years and surpassing all the previous ones on the same pipeline system combined, according to federal data,” NPR reports. “...The spill raised questions for environmentalists and safety advocates about whether TC Energy should keep a federal government permit that has allowed the pressure inside parts of its Keystone system — including the stretch through Kansas — to exceed the typical maximum permitted levels. With Congress facing a potential debate on reauthorizing regulatory programs, the chair of a House subcommittee on pipeline safety took note of the spill Friday. A U.S. Government Accountability Office report last year said there had been 22 previous spills along the Keystone system since it began operating in 2010, most of them on TC Energy property and fewer than 20 barrels… "I'm watching this situation closely to learn more about this latest oil leak and inform ways to prevent future releases and protect public safety and the environment," Democratic U.S. Rep. Donald Payne Jr., of New Jersey, tweeted… “Randy Hubbard, the county's emergency management director, told NPR the oil traveled only about a quarter mile and there didn't appear to be any wildlife deaths. The company said it is doing around-the-clock air-quality checks and other environmental monitoring. It also was using multiple trucks that amount to giant wet vacuums to suck up the oil… “Environmentalists said the heavier tar sands oil is not only more toxic than lighter crude but can sink in water instead of floating on top. Bill Caram, executive director of the advocacy Pipeline Safety Trust, told NPR cleanup even sometimes can include scrubbing individual rocks in a creek bed. "This is going to be months, maybe even years before we get the full handle on this disaster and know the extent of the damage and get it all cleaned up," Zack Pistora, a lobbyist for the Sierra Club at the Kansas Statehouse, told NPR… “An arm of the U.S. Department of Transportation oversees pipeline safety and permitted TC Energy to have greater pressures on the Keystone system because the company used pipe made from better steel. But Caram told NPR: "When we see multiple failures like this of such large size and a relatively short amount of time after that pressure has increased, I think it's time to question that." “...The pipeline runs through Chris and Bill Pannbacker's family farm. Bill Pannbacker, a farmer and stockman, told NPR the company told him that the issues with the pipeline there probably will not be resolved until after the Christmas and New Year's holidays. The hill where the breach happened was a landmark to locals and used to be a popular destination for hayrides, Pannbacker told NPR.”
Nebraska Public Media: Watch: Drone footage reveals extent of Keystone Pipeline oil spill
Daniel Wheaton, 12/11/22
“An oil leak from the Keystone Pipeline is estimated to have released 14,000 barrels, or about 588,000 gallons. The spill spread over pasture ground, and some went into Mill Creek, about five miles northeast of Washington, Kansas,” Nebraska Public Media reports. “Since the leak became known late Wednesday night, crews have begun working on repair and recovery. TC Energy, a Canadian firm, said that multiple vacuum trucks are being used to recover the crude. Aerial footage reveals the extent of the damage…”
Reuters: Major oil pipeline outage to hit U.S. stockpiles, refinery supplies
Arathy Somasekhar, 12/9/22
“An outage on the largest oil pipeline to the United States from Canada could affect inventories at a key U.S. storage hub and cut crude supplies to two oil refining centers, analysts and traders said on Friday,” Reuters reports. “...“The main question continues to be the duration of the potential outage... the longer the duration, ultimately, of course means potentially tighter inventories in Cushing or heavy (crude) on the Gulf Coast,” Michael Tran, a managing director at RBC Capital markets, told Reuters. The line runs directly to the Cushing, Oklahoma, storage hub, which is currently about a third full with nearly 24 million barrels in stock. If the outage last for more than 10 days, it could push Cushing storage to near the operational minimum of 20 million barrels, AJ O’Donnell, a director at pipeline researcher East Daley Capital, told Reuters. Volumes in the fourth quarter will be “materially affected,” as Keystone likely will run at a considerably lower pressure at least for some time once it restarts, Harshit Gupta, Arc Independent research, told Reuters… “TC Energy aims to restart on Saturday a pipeline segment that sends oil to Illinois, and another portion that brings oil to Cushing on Dec. 20, Bloomberg reported, citing sources. TC Energy said it was evaluating plans to return the pipeline to service… “Gulf Coast refiners, which could suffer shortages of heavy Canadian crude, can draw on supplies from offshore Louisiana facilities and from Colombia, Mexico and Ecuador.”
Nebraska Public Media: Couple react to Keystone oil spill on their land
Fred Knapp, 12/9/22
“Crews are beginning work to repair the damage and clean up the oil that spilled from the Keystone pipeline near Washington, Kansas Nebraska Public Media News visited with a couple who own land where the leak happened,” Nebraska Public Media reports. “Bill and Chris Pannbacker welcome a visitor to their land, driving him him up a steep pasture hill, covered with rich brown carpet of prairie grass. But down below the hill, visible in the distance, sits a big black stain. That’s where the Keystone pipeline ruptured Wednesday night, spreading an estimated 14,000 barrels of oil over an area Bill reckons as at least an acre and a half… “Meanwhile, Bill surveyed the damage, and reflected on recent history. He sold an easement to Transcanada, now TC Energy, to build the pipeline in 2009. He says people have become a lot more aware of climate change since then, but if they want oil, pipelines are still the way to go. “Pipelines are as safe a way of transporting product like this as there is, even though we had one blow here. Trains derail and trucks have wrecks. It’s just a price we just have to accept, as a society, he told NPM. Still, Bill doesn’t relish being in the spotlight as cleanup takes place. “Everybody says they have 15 minutes of fame. I hope this wasn’t my 15 minutes of fame right here,” he told NPM.
Ag Update: Keystone Pipeline rupture leaves cattle pasture covered in crude
Amy Hadachek, 12/9/22
“After 14,000 barrels of oil spewed out of a break in a northern Kansas section of the Keystone Pipeline, farmer Bill Pannbacker of Washington, Kansas said he’s left with clumps of crude oil on his pasture,” Ag Update reports. “No livestock were impacted, since it’s mainly a summer pasture. Pannbacker, a former Kansas state legislator and his wife Chris live in town, but Pannbacker farms five miles northeast of Washington with his son. They run 100 head of cows, 100 yearlings and have a small feedlot. They also grow corn, wheat, a little milo and hay. The oil spill left quite a mess, saturating a strip of pasture 30 yards wide, according to Pannbacker. “I compare it to if someone put their thumb over a hose,” he told Ag Update. “It started running into the creek.” The rupture early Thursday, Dec. 8 impacted Mill Creek and went 10-feet over into a neighbor’s yard scattering oil droplets. The pressure caused oil to saturate an acre of Pannbacker’s pasture, he told Ag Update… “Around the site, you can smell oil, but the smell is limited to the general area, Hubbard told Ag Update… “The Environmental Protection Agency is monitoring the situation and is closely involved with the process. The ruptured section of pipe will be analyzed in a lab in Houston, Texas.”
Reuters: Kansas residents hold their nose as crews mop up massive US oil spill
12/11/22
“Residents near the site of the worst U.S. oil pipeline leak in a decade took the commotion and smell in stride as cleanup crews labored in near-freezing temperatures, and investigators searched for clues to what caused the spill,” Reuters reports. “A heavy odor of oil hung in the air as tractor trailers ferried generators, lighting and ground mats to a muddy site on the outskirts of this farming community, where a breach in the Keystone pipeline discovered on Wednesday spewed 14,000 barrels of oil… "We could smell it first thing in the morning; it was bad," Washington resident Dana Cecrle, 56. Told Reuters. He shrugged off the disruption: "Stuff breaks. Pipelines break, oil trains derail." “...Environmental specialists from as far away as Mississippi were helping with the cleanup and federal investigators combed the site to determine what caused the 36-inch (91-cm) pipeline to break… "Hell, that's life," 70-year-old Carol Hollingsworth of nearby Hollenberg, Kansas, told Reuters. about the latest spill. "We got to have the oil."
Lincoln Journal Star: Keystone spill in Kansas the largest in pipeline's 11-year history
CHRIS DUNKER, 12/9/22
“The release of an estimated 600,000 gallons of tar sands oil into a creek near Washington, Kansas, on Wednesday is the largest yet for the 11-year-old Keystone Pipeline, and potentially one of the largest onshore spills of oil or petroleum products in the U.S. since 2010,” the Lincoln Journal Star reports. “...And, based on the early and final reports of previous spills, the amount of oil and other chemicals released from the pipeline could increase — and even double — as the investigation into the cause moves forward… “John Banister, an insurance agent based in Marysville, Kansas, he was driving to a satellite office in Belleville when he passed through what he described as a “strong odor” of oil. “I thought something was malfunctioning in my car, or there was someone with a bad catalytic converter, or a construction crew working on the highway right there at Washington had hit a gas line,” Banister, who was born and raised in Lincoln, told the Journal Star. On Thursday, the Pipeline and Hazardous Materials Safety Administration, which is responsible for regulating oil pipelines in the U.S., issued a corrective action order requiring TC Energy to investigate the root cause of the spill and take the necessary action to fix it… “The order is the fifth issued on the $5.2 billion Keystone Pipeline since it began operations in 2011, according to records kept by the agency responsible for regulating it… “Jane Kleeb, the founder of Bold Nebraska, which led the decadelong opposition to the Keystone XL Pipeline in Nebraska, said in a video posted to Facebook on Friday that stronger laws were needed to ensure pipeline operators are held responsible for leaks that affect people and the environment. She pointed to a bill (LB1186) by Lincoln Sen. Eliot Bostar requiring pipeline companies to develop decommissioning and reclamation plans and established a fund to remove the infrastructure once its operating life had come to an end as one example. That bill died in the Legislature’s Natural Resources Committee earlier this year. “We are living with the pipeline, and now the folks in Kansas are living with a spill,” Kleeb said. “We need stronger laws in place, we do not have enough laws on the books to keep companies accountable for when these things happen.”
Press release: TC Energy actively responding to oil incident
12/9/22
“We are continuing to advance our response efforts at Milepost 14, including: An increased workforce on site including remediation crews. Product remains contained and multiple vacuum trucks and booms are onsite and we have begun the recovery process. Repair planning is also underway, as are shoreline assessments. Continuous air quality monitoring has been deployed. The affected segment of the Keystone Pipeline System remains isolated and downstream migration of the release is contained. Plans for return-to-service continue to be evaluated. At the time of the incident, the pipeline was operating within its design and regulatory approval requirements. Over the last several years, we have taken decisive action to implement measures to strengthen our approach to safety and the integrity of our system and will conduct a full investigation into the root cause of this incident, in cooperation with regulators. We have been working closely with regulators, local elected officials, landowners, the community and tribal nations to keep them informed. The health and safety of onsite staff and personnel, the surrounding community, and mitigating risk to the environment is our primary focus right now. Our response efforts will continue until we have fully remediated the site… “The system remains shutdown as our crews actively respond and work to contain and recover the oil. Our estimated release volume is 14,000 barrels. Our primary focus right now is the health and safety of onsite staff and personnel, the surrounding community, and mitigating risk to the environment. We immediately activated our emergency response procedures and we have established environmental monitoring, including around-the-clock air monitoring. Our response efforts will continue until we have fully remediated the site.”
E&E News: Q&A: Summit exec on status, safety of Midwest CO2 pipeline
12/12/22
“Summit Carbon Solutions plans to build the nation's largest carbon dioxide pipeline — and the safest, according to its chief operating officer,” E&E News reports. “In a recent interview with E&E News, Jimmy Powell heralded the pipeline as a crucial part of the nation's push to decarbonize… “Environmental groups are wary of such projects, especially after a 2020 rupture of a Mississippi CO2 pipeline caused local evacuations. But Powell argued that the Pipeline and Hazardous Materials Safety Administration would ensure Summit builds a pipeline that has a "very, very low probability" of dangerous failure. "This will be the safest, large-scale pipeline ever constructed and operated," Powell said in a recent interview with E&E News. "And I say that because it’s new construction. It’s being designed, constructed and will be operated under the very stringent guidelines of the federal government." “...Meanwhile, Summit sued two Iowa counties last month over local ordinances that would set requirements for the placement of the pipeline. The company claims the ordinances in Story and Shelby counties violate state and federal law because they seek to regulate project permitting, location and safety… “Many of these landowners that are pretty savvy in the process, they know that when you get to a point where you’ve acquired a lot of right of way and/or you’re pretty mature in your permitting process … then they know that it’s a serious project… “Unlike natural gas, crude oil or refined products, it’s not flammable or combustible. So, yes, it is an asphyxiant. It is under high pressure. Any pipeline under high pressure, whether it’s water or anything else, has some level of risk to it. But when compared to other forms of energy products that’s transported [via] pipeline, I think this will be the safest, and that’s borne out by the statistics… “We have the right of eminent domain in South Dakota, in North Dakota and in Nebraska today, and if we’re granted a permit by the Iowa Utilities Board, that will also give us the right of eminent domain in Iowa. So, at some point, with over 4,000 landowners and over 6,000 tracts of land on this project, if we have some minor gaps in the system, we may have to follow that process. But I just want to point out — we’ve had the right of eminent domain for months and we’re still paying premiums to landowners, we’re still negotiating with landowners, we’re not threatening the use of eminent domain.”
The Food & Environment Reporting Network: CO2 pipeline company plays hardball as Iowa counties fight back
Nancy Averett, 12/11/22
“In Iowa, deep-pocketed corporations are hoping to build carbon dioxide pipelines across hundreds of miles of farmland. But county governments are putting the brakes on development by passing ordinances to protect people in the pipelines’ path. In response, Summit Carbon Solutions, the company farthest along in the state’s permitting process, is punching back, filing federal lawsuits to overturn the ordinances and forcing counties to spend scarce taxpayer dollars to defend themselves,” according to The Food & Environment Reporting Network. “This is a tactic of their playbook, and it’s a very effective one,” Jane Kleeb, founder of the nonprofit Bold Nebraska, which helps landowners organize to fight pipelines, told FERN. “During the Keystone XL pipeline fight, every time a county got ready to pass a zoning law, the pipeline company would come in with a team of suits and threaten to sue.” “...Voted into law last month, the ordinances also call for the pipeline companies to provide an emergency response plan and a computer-modeled estimate of the dispersion of CO2, a known toxicant that can be lethal if a pipeline were to rupture. “We have a right to know how dangerous this is,” Steven Kenkel, chairman of the Shelby County Board of Supervisors, told FERN, who pointed to a 2020 carbon dioxide pipeline rupture in Satartia, Mississippi, that hospitalized 45 people. “We want to know what the blast zone is, what the fatality zone is, what the danger zone is, what’s the worst case scenario.” Summit has refused to provide such information, despite an order from the Iowa Utilities Board (IUB)... “Timothy Whipple, an attorney who represents Shelby County, will argue that Summit’s preemption claim is flawed. While the federal Pipeline and Hazardous Materials Safety Administration (PHMSA) sets safety standards for the design, inspection, emergency plans and maintenance of pipelines, he says, it doesn’t preclude state and local governments from considering safety when siting a pipeline. “As long as you don’t impose a requirement that would make it difficult for the pipeline company to comply with the federal safety standards,” Whipple says, “then we believe you can consider safety when looking at the pipeline’s route.”
WASHINGTON UPDATES
Bloomberg: Manchin Says GOP ‘Mad At Me’ In Lamenting Permitting Opposition
12/8/22
“Sen. Joe Manchin (D-W.Va.) lashed out Thursday at critics that have blocked his proposed permitting legislation, arguing Republicans are exerting payback for his support of this year’s climate and tax law,” Bloomberg reports. “It’s become personal—the Republicans are so mad at me because we passed the Inflation Reduction Act,” Manchin said during a free-wheeling talk at an energy efficiency conference at the National Press Club. “I thought they would get over it.” Manchin said the electric vehicle supply chains can be moved to the US and trade allies in two years ‘if everyone works together and understands what we need and why we need it.’ He added, ‘Come guys, get off your butt and get it done.’ Manchin took aim at opponents of the controversial Mountain Valley Pipeline, saying the project was needed to feed liquefied natural gas and replenish low natural gas storage reserves along the Gulf Coast. The Natural Resources Defense Council and Appalachian Voices filed a request for rehearing with the Federal Energy Regulatory Commission, arguing the pipeline developers failed to show ‘good cause’ for the extension and that the commission’s environmental reviews are ‘stale.’”
E&E News: Takeaways from the Democrats’ Big Oil investigation
Corbin Hiar, Nick Sobczyk, Lesley Clark, 12/12/22
“House Oversight and Reform Committee Democrats on Friday released more than 1,200 pages of internal oil and gas industry documents, the product of subpoenas and nearly two years of investigation,” E&E News reports. “The documents — which came from the American Petroleum Institute, the U.S. Chamber of Commerce, Exxon Mobil Corp., Shell PLC, Chevron Corp. and BP PLC — represent only part of what the committee obtained… “The industry files showed oil majors are concerned about their “license to operate” — a phrase referring to the need for social acceptance, which appeared numerous times in the cache. By publicly advocating a limited suite of climate policies and deploying a climate-friendly public relations strategy, industry officials believe they can secure a future for oil and gas. But the latest document dump also reveals how Donald Trump’s 2016 election victory altered the oil industry’s energy policy strategy, divisions over the value of the environment, social and governance investment trend, and an aggressive embrace of corporate secrecy. On the day of the 2016 election, a BP vice president warned the head of the company’s U.S. operations that they could be in trouble if Democratic presidential nominee Hillary Clinton won the White House. “We appear more defensive in the US vs. other places around the world,” Seymour Khalilov wrote to his boss, John Mingé, both of whom have since left the company. “We wait for the rules to come out, we don’t like what we see, and then try to resist and block.” “The risk is if we have a democratic administration and continue with the same attitude, they can push ahead with regulations across the full infrastructure chain, forcing us to adjust,” Khalilov said in an email about “climate issue and carbon markets.” “Better option may be to engage early, and help set up a well-designed policy that works and lets the market do its job, and slow the pace and price of demand erosion,” he said. The phrase “well-designed” was underlined in the email, which argued that “BP is competitively positioned” to benefit from a cap-and-trade approach to addressing climate change. But after Trump’s surprise victory, BP shifted from debating climate policy options to making the most of the new administration’s support for fossil fuel development.”
The Hill: Biden adviser calls investor refusal to ramp up shale drilling ‘un-American’
ZACH SCHONFELD, 12/11/22
“President Biden’s energy envoy called U.S. shale investors’ refusal to ramp up drilling “un-American” in an interview with the Financial Times,” The Hill reports. “Amos Hochstein, the State Department’s senior adviser for energy security, criticized recent stock buyback schemes by ExxonMobil and other companies, urging them to ramp up drilling as Americans face high gas prices fueled by Russia’s invasion of Ukraine. “I think that the idea that financiers would tell companies in the United States not to increase production and to buy back shares and increase dividends when the profits are at all-time highs is outrageous,” Hochstein told the British newspaper. “It is not only un-American, it is so unfair to the American public,” he added. “You want to pay dividends, pay dividends. You want to pay shareholders, pay shareholders. You want to get bonuses, do that, too. You could do all of that and still invest more. We are asking you to increase production and seize the moment.” ExxonMobil announced its highest-ever earnings of $19.7 billion in the third quarter of 2022, the latest measure of soaring profits in the industry amid high energy prices. The company has argued the buybacks, which give more money to shareholders by increasing the price of the company’s stock, are equivalent to returning the money directly to the American people. “The only thing worse than announcing a share buyback is to say that is how you’re giving profits back to the American people,” Hochstein told the Financial Times (FT).
Reuters: Big Oil Does Little to Act On Climate Despite Vows
Timothy Gardner, 12/12/22
“Major energy companies are not doing enough to prevent the worst effects of climate change despite public promises to fight the problem, a U.S. House panel said about documents released on Friday that it got in a probe,” Reuters reports. “Democrats on the House Committee on Oversight and Reform subpoenaed major oil executives for the documents, which included internal corporate emails, late last year after a hearing grilling them over their response to climate change. Many of the documents showed major oil companies discussing the strategy of selling off, or divesting, oil and gas fields to smaller companies to lower their own emissions – a move that simply shuffles those emissions to the next company without reducing them, the panel said… “At Shell, spokesperson Curtis Smith said in an internal email about divesting from assets in Canada’s oil sands: “True, we transfer CO2 liability when we divest.” “It’s no different, however, when we are denied resource access in the U.S. (or elsewhere) and that energy need is then met with resources in a country that (likely) has far fewer regulations than we do in a modern, civilized society,” he said in the email. In the documents secured by the House panel, a colleague of Smith’s said in an emailed response: “What exactly are we supposed to do instead of divesting …pour concrete over the oil sands and burn the deed to the land so no one can buy them?”.. “Shell’s Smith told Reuters the House panel’s probe failed to uncover evidence of a climate disinformation campaign. “In fact, the handful of subpoenaed documents the Committee chose to highlight from Shell are evidence of the company’s extensive efforts to set aggressive targets, transform its portfolio and meaningfully participate in the ongoing energy transition,” Smith told Reuters… “Representative Carolyn Maloney, the committee chairwoman, told Reuters the executives admitted in testimony last year to the panel that oil and gas production is contributing to a climate emergency, but that they have been doing too little to address the issue. “Today’s new evidence makes clear that these companies know their climate pledges are inadequate, but are prioritizing Big Oil’s record profits over the human costs of climate change.”
STATE UPDATES
Des Moines Register: Explosion, fire in Marengo fuel plant leads to injuries and evacuation
Francesca Block, George Shillcock, Donnelle Eller, 12/8/22
“An explosion resulted in a fire and multiple injuries at an alternative fuel plant in Marengo Thursday morning, prompting the city to urge residents to evacuate and avoid the area,” the Des Moines Register reports. “Firefighters battled the blaze until 4:30 a.m. Friday, when it was fully extinguished and fire operations were completed, Marengo police chief Ben Gray told the Register. Multiple injured people remained at University of Iowa Hospital and at least one in serious condition at the burn unit, Gray said Friday morning. The fire, at the C6-Zero plant in the 800 block of East South Street, caused city officials to urge all residents to avoid being outside because of the dense smoke. The Iowa County Sheriff's office also urged residents to avoid the area… “Initially, as firefighters battled the blaze, there was confusion about what the plant produced. According to Iowa secretary of state records, it is still owned by Heartland Crush, a soybean mill. But the plant is now occupied by a company called C6-Zero. That company says online that it recycles discarded asphalt shingles, using what it describes as "a large washing machine" filled with a proprietary solution to separate the fiberglass, oil and sand they contain. Those products are then sold to be reused and repurposed, the company says… “All of the surrounding counties had sent fire personnel to assist with battling the continuing blaze, Conrad told the Register. He told the Register the cause of fire had not been determined.”
High Country News: Could Alaska help lessen international dependence on Russian oil?
Victoria Petersen, 12/9/22
“In late October, Japanese, U.S. and Alaska energy and government officials convened in Tokyo to discuss the Alaska LNG project, which would transport natural gas from Alaska’s far north oil and gas reserves to an export facility in the south-central part of the state,” High Country News reports. “For decades, Alaska was Japan’s sole source of imported natural gas. Today, Russia supplies many European and Asian countries with liquid natural gas, but many are eager to lessen their dependence on Russian fossil fuels in light of the country’s invasion of Ukraine. This, combined with a high global demand for natural gas and the fact that the Alaska LNG project has secured the necessary permits, has intensified interest in the project among U.S. and Alaska officials. However, it comes with considerable environmental impacts and a steep price tag… “The Alaska Federation of Natives, Alaska Native Village Corporation Association Inc. and many communities in the Kenai Peninsula Borough — where the liquefaction facility would be built and where 20 million tons of natural gas would be processed, stored and transported annually — have all signaled support for the project, citing its economic benefits. But climate groups are critical of the project. They note the impact it would have on the environment, both through its direct effects on the landscape and the greenhouse gas emissions it would produce… “Rosemary Ahtuangaruak, the mayor of Nuiqsut, a small Inupiat village in Alaska’s North Slope Borough and the closest community to the project’s northern base, told HCN that her biggest concerns are her community’s proximity to gas emissions as well as the project’s effects on land, wildlife and subsistence harvests. “We're very concerned about what's going to happen with the process and having to deal with the changes to our lands and waters and the risks to our animals that we depend on for food,” she told HCN. “All the current activities as well as proposed are really in the heart of our livelihoods, where we feed our families, where we harvest as our elders did. Now we have infrastructure going up in so much of these areas, it's changing our stories of how we use our lands and waters.”
Colorado Sun: Colorado requires drillers assess “cumulative impacts”of oil and gas wells. Does it make a difference?
Mark Jaffe, 12/9/22
“Plans for nearly 1,500 new Colorado oil and gas wells were approved in 2022 and while all of them had to assess the cumulative impacts the drilling would create, environmental and community groups say those evaluations are inadequate,” the Colorado Sun reports. “The Colorado Oil and Gas Conservation Commission on Friday will hold a hearing on a petition by six environmental groups calling for regulators to adopt tougher rules on measuring and judging the impacts of the growing number of oil and gas wells in the state. The groups — WildEarth Guardians, the Sierra Club, 350 Colorado, Womxn from the Mountain, Physicians for Social Responsibility Colorado, and the Larimer Alliance for Health, Safety and the Environment — want the COGCC to start a new rulemaking process… “When the commission did mission-change rulemaking, it acknowledged that those rules weren’t going to be enough to address cumulative impacts,” Kate Merlin, an attorney with WildEarth Guardians, told the Sun. The industry and oil and gas dependent counties, however, see the petition, with its emphasis on broad issues such as regional ozone pollution and climate change, as a way to throttle the sector… “The problem is that the material, so far, is so general that it is difficult to judge the real impacts or blunt them, Heidi Leathwood, a climate analyst with the environmental group 350 Colorado, told the Sun… “Industry acknowledges the concern over climate change,” Haley told the Sun, adding the combination of the new rules and state-of-the-art technology is enabling Colorado operators to produce “the world’s cleanest molecules” of oil and gas. Still, the environmental groups contend without better data and a more rigorous analysis it is difficult to know the full impacts. They also question cumulative impact estimates in drilling plans. “Some of them don’t pass the smell test and there is no penalty if the estimates are wrong,” Merlin told the Sun. As an example, she cited a plan by one operator which included 23 separators, devices that separate oil, water and gas coming out of a well, which would have zero emissions. “
Searchlight NM: Magnate opus: The power plays of Harvey Yates
Alicia Inez Guzmán, 12/8/22
“On a cloudless Tuesday afternoon this fall, Harvey E. Yates Jr., drives around Valencia County describing his plans for the future. At one corner, he envisions a thriving shopping center with a filling station and a hardware store. Elsewhere, he sees a ranch for wayward boys, and, finally, in the southeastern expanse — oil wells. His holdings are vast,” Searchlight NM reports. “...To him, the looming crisis isn’t the methane clouds that hang over parts of New Mexico, the polluted aquifers from drilling, or even the prospect of earthquakes and climate change: The looming disaster is the possibility that government regulations will tighten and the industry will stop producing. “If the oil and gas industry pulled out tomorrow, that’s where your disaster would be,” as Yates recently argued before the Valencia County Commission. The industry provides roughly 30 percent of New Mexico’s general fund revenue: The state couldn’t function without it. What Yates doesn’t mention is that the industry equally needs New Mexico. His grandfather, Martin, helped pave the way for an enduring relationship between the state and its extractive industries, and his descendants, including Harvey, have carried on in that spirit of exploration. By the early aughts, members of the Yates family reportedly owned more oil and gas leases on public lands than anyone else in the country… “Harvey Yates has devoted decades to keeping the mutual dependency alive. That includes striking out for new sources of fossil fuels, seeking political allies and finding platforms to win hearts and minds. Earlier this year, he helped buy a newspaper to “remedy,” in his words, “the fact that conservatives are so often canceled.” “...Just one month later, he appeared at the Valencia County Commission meeting to speak in support of a natural resources ordinance that he’d helped craft — one that would enable him to realize a decades-long ambition of drilling in the Albuquerque Basin, succeeding where no one else has. The measure, after drawing fierce community opposition, ultimately passed 3 to 2. Through it all, his business, Jalapeño Corp., pumped more than $200,000 into the recent primary and midterm elections, 90 percent of which went to Republican candidates. His campaign contributions in this state were second only to Chevron’s.”
EXTRACTION
The Hill: JPMorgan Chase CEO warns oil, gas issues will persist for years because of Russia-Ukraine war
ZACH SCHONFELD, 12/11/22
“JPMorgan Chase CEO Jamie Dimon on Sunday warned that the fallout of Russia’s invasion of Ukraine on oil and gas markets will persist “for years,” The Hill reports. “The danger of this war is extraordinary,” Dimon told CBS’s Margaret Brennan during an interview that aired on “Face the Nation,” saying the public has a “false sense of security.” “And it can go on for years,” he added. “But this oil and gas thing, it looks like the Europeans will get through it this winter. But this oil and gas problem is going to go on for years. So if I was in the government or anywhere else, I’d say, I have to prepare for getting much worse. I hope it doesn’t. But I would definitely be preparing for it to get much worse.” “...Dimon suggested the recent declines are in part because of an economic slowdown in China after multiple years of Xi Jinping’s government enforcing a “zero COVID” strategy and the start of a recession in Europe. But the banking executive warned that those short-term declines won’t last forever, calling for a “Marshall Plan for energy” that includes significant investment in energy infrastructure to boost production and keep prices low. “Those things will reverse,” Dimon told Brennan. “And this underinvestment in oil and gas, it will hurt you two or three years out. It’s quite predictable, but it’s not today.” “...We need secure, reliable, cheap oil and gas,” Dimon said on CBS. “The problem, you know, a lot of people think that oil and gas prices being high is good for CO2. It’s not.”
Politico: Giant renewable hydrogen plant planned in Texas
DAVID IACONANGELO, 12/9/22
“Two major energy companies said yesterday they plan to construct a $4 billion renewable hydrogen project in northern Texas that would be one of the largest such plants in the United States,” Politico reports. “Known as the Texas Green Hydrogen Project, the project is a joint venture of power plant developer AES Corp. and natural gas hydrogen producer Air Products and Chemicals Inc. The companies say they hope to extract "green" hydrogen from water molecules using electricity from wind turbines and solar panels — a process that typically does not emit greenhouse gases… “The plans come amid concerns that green hydrogen may not live up to its reputation as the cleanest type of hydrogen. More than 150 groups submitted comments to the Treasury Department this month about the clean hydrogen production tax credit created by the Inflation Reduction Act, with some urging federal officials to ensure that manufacture of the fuel does not create more emissions than anticipated. AES and Air Products officials say they expect to take advantage of the new tax credits… “One concern raised by emissions researchers and environmentalists was that companies could earn tax credits for making green hydrogen, even if their production method involved some dirty electricity from the grid. Critics say that could happen if offsets were used or if companies do not directly build renewable projects to manufacture hydrogen… “Other environmentalists pressed Treasury to take a strict approach when determining the kinds of offsets that green hydrogen producers could use to reduce their emissions profile when seeking to claim tax credits. One comment signed by 18 groups, including the Center for Biological Diversity and Food and Water Watch, warned of "carbon accounting gimmicks" that could increase pollution in front-line communities. "The new PTC is uniquely vulnerable to becoming a Trojan horse for polluting industries," wrote the 18 groups.
OPINION
Pipeline Fighters Hub: The Keystone Pipeline Is A Lemon. It Just Leaked Again for the 22nd Time
Paul Blackburn, 12/9/22
“The ill-fated Keystone Pipeline has spilled yet again. On December 7, the pipeline leaked near Washington, Kansas, resulting in a spill of at least 14,000 barrels – over 500,000 gallons – of tarsands, benzene and other unknown chemicals into nearby land and waterways, the largest US oil spill in nearly a decade. It’s worth understanding, in part because it serves as a cautionary tale for carbon pipeline development,” Paul Blackburn writes for the Pipeline Fighters Hub. “This isn’t the first time the Keystone pipeline has spilled. Since it began operation in 2010, there have been twenty-two leaks and ruptures (for a full list click here). The Keystone Pipeline is a lemon. This blog identifies some of the factors that contributed to its past spills, as well as some new factors possibly related to the December 7 spill… “Interestingly, the CAO states that TC Energy was running an in-line inspection (ILI or smart PIG) at the time of the rupture, and that this tool was south of the rupture site. An ILI is sort of like an ultrasound, NMR or CAT scan for a pipeline. Assuming the tool was being run with the flow of the oil, this suggests that TC Energy may have very recent ILI data on the pipe segment that burst… “PHMSA ultimately required TransCanada to replace some of the pipe segments in the Keystone Pipeline. For a full history of the defective steel issue, check out my 2010 report on this issue… “Much of the pipe was laid in trenches flooded with water, to the point that TransCanada needed to weigh down the pipe with cement “saddles” in many locations to make the pipe sink to the bottom of the trench. This “saddling” contributed to at least one rupture. In addition, before construction even started, PHMSA waived a safety regulation and issued a “Special Permit” that authorized the Keystone Pipeline to operate at higher than normal pressures. PHMSA’s hazardous liquid pipeline safety regulations limit pipeline pressure to 72% (a design factor of 0.72) of the “minimum yield strength” of the steel pipe. The Special Permit authorizes TransCanada to operate the Keystone Pipeline at up to 80% of minimum yield strength – a lower margin of safety… “Although the company has not described how it plans to increase capacity, it is possible that it is injecting a substance called “drag reducing agent” (DRA) into the pipeline, but it may also have modified its pumps and other equipment to support a higher flow. The chemical composition of DRA is generally a trade secret. While the potential stresses caused by increased throughput are not known, it seems reasonable to investigate whether this experiment could have contributed to the Washington, Kansas failure. Perhaps TransCanada was trying to make lemonade, and instead made a mess… “The Keystone Pipeline release saga provides a cautionary tale for the proposed tsunami of carbon pipelines. There is a risk that the tens of thousands of miles of proposed new carbon pipelines will be rushed to completion by inexperienced companies, in competition with each other for scarce labor and materials, regardless of working conditions, on routes chosen to minimize cost – all to rake in obscenely generous federal tax credits – thereby laying a foundation for a follow-on wave of carbon pipeline ruptures that harm or even kill the humans and animals living near them. All that being said, the safest pipeline is one that is never built.”
The Hill: Progressives should have supported Manchin’s permitting reforms: Here’s why
Catherine Wolfram is a visiting professor at the Harvard Kennedy School on leave from UC Berkeley. From 2021-2022 she served as Deputy Assistant Secretary for Climate and Energy at Treasury, 12/11/22
“When Congress passed the Inflation Reduction Act earlier this year, the U.S. took a huge step forward toward a long-overdue transition away from fossil fuel energy,” Catherine Wolfram writes for The Hill. “...But language introducing permitting reform was stripped from the National Defense Authorization Act on Tuesday, leaving that promise at risk of going unfulfilled. Opposition from the Congressional Progressive Caucus was pivotal to this outcome, but some of the reasoning behind their opposition is perplexing and counterproductive… “Progressives are instead focused on the fact that the permitting reforms allow fossil fuel projects to go forward. Rep. Ro Khanna (D-Calif.) has called it a “giveaway to the fossil fuel industry.” “...Indeed, the arguments that the progressives make against carbon pricing are exactly why they should have supported Manchin’s permitting reforms. Blocking fossil fuel projects makes it more costly to deliver energy with existing fossil fuels. In effect, it creates a kind of carbon price, just one that’s haphazardly applied, usually extremely high, and where the revenues accrue to fossil fuel producers instead of the government. At the end of the day, low-income households’ energy bills go up… “Many policies leave us with hidden high carbon prices. Every time a city bans gas stoves, states stop pipelines, or shareholder activists prevent investment in new energy infrastructure, we are raising the price of energy to consumers and, in some cases, driving up profits for fossil fuel companies… “There are other legitimate concerns with the Manchin reforms. Short-circuiting the regulatory process could leave essential environmental justice considerations out of the conversation, for instance. We can address these important concerns, but that need not stop investments.”
New York Times: Indian Country Needs Money to Protect Its Wildlife Heritage. Congress Must Help.
Gloria Tom is the director of the Navajo Nation’s Department of Fish and Wildlife and a board member of the National Wildlife Federation, 12/12/22
“Over the last few decades, there has been a steady stream of news about the crisis facing fish and wildlife across the world,” Gloria Tom writes for the New York Times. “The journal Science in 2019 reported the loss of nearly three billion birds in North America since 1970, and more than 1,600 plant and animal species in the United States now require federal protection for survival. Worldwide, extinctions are accelerating. One comprehensive study warned that as many as one million species worldwide could vanish, many within decades. For many tribal nations and Indigenous peoples, these losses are more than a statistic. They represent a fundamental threat to how Native peoples practice their religions and pass on their cultures, foods and traditions to the next generation. As sovereign entities responsible for managing tens of millions of acres, tribal nations don’t just manage wildlife and their habitats for biological and scientific purposes. We also manage them for our own well-being and livelihoods. Native American tribes nonetheless have been systematically excluded from the major sources of federal conservation funding. Now, however, legislation that has passed the House and is currently in the Senate would make available $97.5 million a year to the country’s 574 recognized tribes, their first-ever dedicated federal funding for wildlife conservation. This would be a welcome and an important change. State fish and wildlife agencies depend heavily on hunting and fishing gear taxes. But tribes were not included in the decades-old laws that makes this funding available and are not eligible to receive it, even though we pay these taxes like everyone else and tribal lands are included in the formula that calculates how much money a state receives from the federal government. Another program, the State and Tribal Wildlife Grant Programs guarantee money to the states, but require tribes to compete against each other for grants capped at $200,000, an amount that stifles our ability to build the necessary staff and resources or take on long-term restoration projects. Over the first two decades of these programs, which began for states in 2000 and for tribes in 2001, states and territories received over $1 billion; tribes got around $94 million. And the Land and Water Conservation Fund, which supports conservation and recreation programs with revenues from federal oil and gas leases on the Outer Continental Shelf, treats tribes largely as subsidiaries of the states, not as the sovereign nations they are, by requiring tribes to apply to their states for grants… “The legislation before the Senate, if passed, would mark the first time Congress has sought to leverage our thousands of years of knowledge and our vested interest in solving the biggest challenges facing our fish and wildlife… “The crisis facing thousands of species of fish, wildlife and plants cannot be solved without investing in the work already underway on the Navajo Nation and on other tribal lands and waters. The Senate should seize the moment before it recesses for the holidays and pass what would be a historic win for Indigenous communities and for wildlife.”
The Hill: Banks for the planet: The future of financing
Deborah Brosnan, Ph.D., is an environmental scientist and a marine resilience specialist, working to bolster science in decision-making involving the environment, endangered species, energy development, sea-level rise, climate change and environmental hazards, 12/9/22
“When large and influential institutions that are not typically at the forefront of climate conversations take climate policy action, I pay attention,” Deborah Brosnan writes for The Hill. “...Last week, when the U.S. Federal Reserve Board joined other banking regulators in putting forth a plan for how large banks should manage climate-related financial risks, I took note… “The plan put forward is for banks with more than $100 billion in assets, and it covers how banks should incorporate financial risks related to climate into their strategic planning. The board approved putting the proposal out to the public for comment by a 6-to-1 vote. When we discuss the financial impacts of climate change, there’s the obvious consequences — rising sea levels, worsening floods, fires and droughts that threaten financial assets and markets. However, government policies for managing climate-risks, and transitioning away from fossil fuel industries in exchange for green energy holds tremendous potential to impact — dare I say, wipe out — trillions of dollars of assets around the globe. This reality has the Fed concerned; they stated that, combined, these “pose an emerging risk to the safety and soundness of financial institutions and the financial stability of the United States.” So, what has the Fed proposed? Their plan would require banks to include climate-related financial risks in their audits and other risk management. It would require them to add climate-related scenario analysis to traditional stress testing. Banks are also being asked to assess whether they should include climate-linked risks into their liquidity buffers… “There are people who believe that climate-change is a low risk and that the systems we have created — including financial ones — are sufficiently robust to remain stable. The actions of the Fed and other institutions should be a wakeup call that they are not, unless we take action.”