EXTRACTED: Daily News Clips 2/2/22
PIPELINE NEWS
Agweek: Summit Carbon Solutions files for pipeline permit in Iowa
Press release: Enbridge signs letter of intent for Line 5 segment relocation project
Facebook: Rep. Dianne Herrin: Mariner East Alert
Associated Press: Expansion of $260M gas pipeline completed in North Dakota
S&P Global: Expansion project looks to boost Bakken production, squeeze out Canadian exports
WASHINGTON UPDATES
STATE UPDATES
Capital and Main: How Oil Lobbyists Continue to Exert Influence on California Regulators and Lawmakers
Sacramento News & Review: Sacramento’s oil secret: New analysis reveals fossil fuel industry’s job claims are ‘wildly inaccurate’
9News.com: Colorado oil and gas companies can hide some chemicals used in fracking if they claim 'trade secrets'
EXTRACTION
Press release: ExxonMobil Earns $23 Billion in 2021, Initiates $10 Billion Share Repurchase Program
Carlsbad Current-Argus: Permian Basin oil and gas deals getting bigger as market recovers from COVID-19
Globe and Mail: Imperial Oil raises dividend amid highest level of crude production in more than 30 years
IHS Markit: Greenhouse Gas Intensity of Canadian Oil Sands Production Continues to Decline Despite COVID-Induced Market Disruptions
CabinRadio: Do we know enough to release Alberta’s treated tailings?
CLIMATE FINANCE
Aspen Times: Guns, oil and tobacco unlikely in Pitkin County’s future portfolio
OPINION
FOX Business: Gas prices in California will soar following LA ban on new oil and gas wells, industry rep warns
PIPELINE NEWS
Agweek: Summit Carbon Solutions files for pipeline permit in Iowa
Jeff Beach, 2/1/22
“The company behind what could become the world's largest carbon capture project announced Tuesday, Feb. 1, that it has filed its first permit application with the Iowa Utilities Board,” Agweek reports. “...While Summit announced plans for the Midwest Carbon Express last year and has been working on acquiring easements from landowners for the pipeline, Iowa, where the pipeline with originate, is the first state where it has filed for a permit. Chris Hill, who’s in charge of permitting for Summit, told Agweek that the company could have applications submitted in North Dakota and South Dakota by the end of February. Other states to be connected along the more than 2,000 mile route of the pipeline are Minnesota and Nebraska, where there is currently not a single state agency with authority over carbon pipelines. Instead Summit will have to obtain permits from individual counties. A federal permit also is required for some points along the route where the pipeline will cross federally protected waterways… “The project has been controversial, especially in Iowa, where some environmental and landowner groups have voiced opposition.”
Press release: Enbridge signs letter of intent for Line 5 segment relocation project
2/1/22
“Enbridge, Inc., North America’s largest energy infrastructure company, has signed a letter of intent with Michels Pipeline, Inc. as the mainline contractor for the Line 5 Segment Relocation Project in Wisconsin. Michels Pipeline, Inc., headquartered in Brownsville, Wis., is part of the Michels family of companies… “According to an economic impact study from Capital Policy Analytics, the project will support 700 direct family-supporting construction jobs. It’s estimated that $46 million will be spent specifically contracting with Native-owned businesses, in Tribal communities, and on training and hiring Native American workers. It’s anticipated Native American workers will make up 10% of the project’s direct workforce. The economic impact study also found the project will ultimately add $135 million to Wisconsin’s economic output and increase state tax revenues by $6.4 million and federal tax revenues by $78 million. An agreement has been reached with all private landowners along the 41-mile re-route, chosen because it minimizes environmental impacts and protects critical resources. Construction will move forward once all necessary permits have been received.”
Facebook: Rep. Dianne Herrin: Mariner East Alert
2/1/22
“I am currently monitoring the situation regarding crews along the Mariner East pipeline path near the Wellington retirement community at Boot Road. With good reason, residents became extremely concerned this morning when crews returned to this area, despite completion of construction here several months ago. Sunoco/Energy Transfer once again disregarded the needs of the public and did not notify the Township they were coming. The Township has since learned a possible anomaly was detected in this area of the pipeline, and the operator says it is digging it up to further investigate. The operator also informed the Township that work is expected to be complete by end of day, Wednesday February 2nd. Considering the lack of credible safety, communications, and evacuation plans for this pipeline — which carries highly-volatile liquids including ethane, propane, and butane — any and all emergency work performed without proper notification to residents or the Township is a great cause for concern. If this pipeline were truly a “public utility,” the operator would be acting with the public interest and public safety in mind by, at the very least, keeping our community informed. I am calling on the PUC to take action and Sunoco/Energy Transfer to communicate to our municipalities and residents regarding any work being done on the Mariner East projects.”
Associated Press: Expansion of $260M gas pipeline completed in North Dakota
2/1/22
“A subsidiary of Bismarck-based MDU Resources Group Inc. said Tuesday it has completed expansion of a $260 million natural gas pipeline in western North Dakota,” the Associated Press reports. “State officials have hailed WBI Energy Inc.’s North Bakken Expansion project as a step toward curbing the wasteful flaring of excess gas, while increasing state tax revenues by allowing more oil drilling in the area. Officials have said oil drilling in the area north of Lake Sakakawea is hamstrung by the lack of natural gas infrastructure. Federal Energy Regulatory Commission officials last summer approved a certificate of public convenience and necessity for the project, which adds 250 million cubic feet of natural gas per day to a pipeline network… “The line would connect to the Northern Border Pipeline south of Watford City, where the gas would be sent to Iowa, Chicago and other markets.”
S&P Global: Expansion project looks to boost Bakken production, squeeze out Canadian exports
Brandon Evans, Richard Frey, Felix Clevenger, 1/31/22
“North Dakota gas production appears poised to grow with the approval of WBI's North Bakken Expansion Project, which could propel AECO higher as Canadian producers look to boost exports further before being squeezed out this summer,” S&P Global reports. “...The possibility that oil prices will hold at elevated levels, as well as expanded takeaway infrastructure coming online in WBI Energy's North Bakken Expansion Project, could be conducive to growth. The project will transport associated natural gas from the Williston Basin to a new interconnect with Northern Border Pipeline's existing mainline in McKenzie County, North Dakota. It will have the capacity to transfer up to 250 MMcf/d. Bakken production gains could displace more Canadian supply from entering the Midwest on Northern Border Pipeline to alternative routes and likely flow on Great Lakes or Viking… “The North Bakken Expansion Project received final US Federal Energy Regulatory Commission approval Jan. 27, setting the stage for more Bakken production to reach Northern Border at the expense of AECO.”
WASHINGTON UPDATES
Politico: NO APPEAL
Matthew Choi, Ben Lefebvre, 2/1/22
“Environmental groups are pressuring Interior to forgo any appeal to the D.C. District Court ruling last week that invalidated the November Gulf of Mexico lease sale and caused alarm among players in the oil sector,” Politico reports. “Greenpeace USA, Oil Change USA, 350.org affiliates and others are urging the department to stand down in the same way it did when a judge tossed the department’s decision to authorize the Willow oil project in Alaska. “Any proper [environmental] analysis will show that new leasing is incompatible with addressing the climate emergency,” the groups state in their letter. “With this in mind...we also strongly urge the Department of the Interior to create a new five-year offshore lease program with no proposed offshore lease sales when the current program expires in June 2022.”
Reuters: U.S. considering hike to royalty rate for drillers at onshore auctions
1/31/22
“The Biden administration is considering raising the royalty rate that drilling companies must pay on oil and gas leases that it plans to sell in the first quarter, according to a draft notice posted but then removed from the U.S. Bureau of Land Management (BLM) web site,” Reuters reports. “The royalty rate for leases offered this quarter would be 18.75%, up from the 12.5% minimum rate required by law, according to the post, which was viewed by Reuters on Monday. An Interior Department official said the notice had been posted inadvertently. "The BLM accidentally posted some pre-decisional draft language on their website," the official told Reuters… “If the higher rate is finalized, the move would be in keeping with President Joe Biden's pledge to reform oil and gas leasing on federal lands as part of his climate change agenda. The administration is planning onshore lease sales in several states this quarter. Biden had paused drilling auctions after taking office, but that effort failed after producing states sued… “In a report on the federal oil and gas leasing program published late last year, Interior said the 12.5% rate had been in place for a century and was "out of step with modern times.”
STATE UPDATES
Capital and Main: How Oil Lobbyists Continue to Exert Influence on California Regulators and Lawmakers
Aaron Cantu, 1/31/22
“While Gov. Gavin Newsom and other California leaders trumpet the state’s progress on reducing emissions, emails obtained by Capital and Main show that the oil and gas industry continues to exert influence over critical climate policy. With the Legislature poised to consider far-reaching legislation in the next few months, the industry’s sway with both elected officials and regulators threatens to undermine the state’s efforts to address climate change. An email exchange from last spring, obtained by Capital & Main through a records request, confirms that the industry was able to win a subtle but significant change to a bill that would have codified California’s 2045 net-zero greenhouse gas emissions goal into law before it even went to a committee hearing… “Soon after oil and gas lobbyists reached out to staff of the bill’s author, Assemblymember Al Muratsuchi, the bill was changed to give the industry greater discretion for how to meet emissions targets. In an email following their discussion, a legislative staffer outlined the changes to Margo Parks, a lobbyist for the Western States Petroleum Association (WSPA), and several other oil and gas lobbyists. Specifically, the changes removed a provision mandating that 90% of emissions reductions be achieved only through actual cuts to pollution, rather than carbon dioxide removal. According to Muratsuchi, the bill was likely altered after Susan Chan, the chief consultant for the Joint Legislative Committee on Climate Change Policies who was in contact with various interested parties, discussed proposed changes with one or more lobbyists.”
Sacramento News & Review: Sacramento’s oil secret: New analysis reveals fossil fuel industry’s job claims are ‘wildly inaccurate’
Dan Bacher, 2/1/22
“The Western States Petroleum Association, or WSPA – the most powerful corporate lobbying group in Sacramento – claims that there are 368,000 jobs in the oil industry in California,” the Sacramento News & Review reports. “...But a just-released Food & Water Watch analysis counts just 22,000 jobs in the industry in California, based on Department of Labor statistics — and says this total has dropped 40% over the past decade. “Overall, oil and gas production account for barely one-tenth of 1% of all employment in California,” the analysis revealed. WSPA spent a total of $4,267,181 on lobbying California legislators and officials in 2020 and $8.8 million in 2019 as thousands of oil and gas drilling permits were approved by CalGEM, the state’s oil and gas regulatory agency… “When Gov. Gavin Newsom announced modest plans to phase out permitting for new oil production in California, industry advocates freaked out,” according to the analysis. “The Western States Petroleum Association claimed that the oil industry supports close to 368,000 jobs in the state. That is surprising since, according to the Bureau of Labor Statistics, only 22,000 Californians were involved in oil production in 2020, down 40 percent from the industry’s peak in 2012. In the Golden State, oil and gas production accounts for barely one-tenth of 1% of all employment.” The analysis notes that one of the most misleading aspects of industry jobs analysis is the conflation of direct jobs with indirect and induced jobs. “Direct jobs are positions directly within a given industry,” the review noted. “Indirect jobs are those within the supply chain that supports that industry, while induced jobs are positions supported by wages from both direct and indirect jobs. Indirect and induced jobs account for nearly 75 percent of the top-line numbers that some oil and gas companies are referencing. Misattributing these jobs to the oil and gas industry itself distorts the size and scope of the industry’s payroll.”
9News.com: Colorado oil and gas companies can hide some chemicals used in fracking if they claim 'trade secrets'
Marshall Zelinger, 2/1/22
“Colorado Democrats made a big deal about a 2019 law regulating oil and gas operations with a focus on public health, safety and the environment. But oil and gas companies in Colorado do not have to reveal every single chemical they use in fracking. They can hide them claiming "trade secrets," 9News.com reports. “A new report out of Washington D.C. by Physicians for Social Responsibility (PSR), a watchdog group critical of the oil and gas industry, points out that Colorado allows oil and gas companies to shield some of the chemicals they use if they're considered trade secrets. "Companies have the ability to hide chemical identities from the public, and even from regulators, by naming them trade secrets," Dusty Horwitt, author of the PSR report, told 9News.com. "We can't know, in those cases, if the chemical is relatively benign or if it's something very dangerous like a forever chemical." "These are man-made chemicals. As I always say, since nature did not make them, nature does not know how to break them," Shubham Vyas, Associate Professor of Chemistry at the Colorado School of Mines, told 9News.com. "In the last couple of decades we have learned that these compounds can cause serious diseases in human beings." “...PSR would like Colorado to adopt California standards, which require disclosure of all chemicals, just not necessarily the proportions. Similar to nutritional labelling requirements.”
EXTRACTION
Press release: ExxonMobil Earns $23 Billion in 2021, Initiates $10 Billion Share Repurchase Program
2/1/22
“Exxon Mobil Corporation today announced fourth-quarter 2021 earnings of $8.9 billion, or $2.08 per share assuming dilution, resulting in full-year earnings of $23 billion, or $5.39 per share assuming dilution. Capital and exploration expenditures were $5.8 billion in the fourth quarter and $16.6 billion for the full year 2021, in line with guidance. "Our effective pandemic response, focused investments during the down-cycle, and structural cost savings positioned us to realize the full benefits of the market recovery in 2021," said Darren Woods, chairman and chief executive officer. "Our new streamlined business structure is another example of the actions we are taking to further strengthen our competitive advantages and grow shareholder value. We've made great progress in 2021 and our forward plans position us to lead in cash flow and earnings growth, operating performance, and the energy transition." “...Since establishing the Low Carbon Solutions business in early 2021, ExxonMobil announced progress on 10 carbon capture and storage opportunities. The initiatives are in Houston, Texas; LaBarge, Wyoming; Edmonton, Canada; St. Fergus, U.K.; Southampton, U.K.; Fife, U.K.; Normandy, France; Malaysia; Indonesia; and Russia.”
Carlsbad Current-Argus: Permian Basin oil and gas deals getting bigger as market recovers from COVID-19
Adrian Hedden, 2/1/22
“Three recent acquisitions of oil- and gas-producing assets in the Permian Basin moved more than $1 billion in the last week, as the market for fossil fuels in the U.S. grows along with production in the basin – one of the nation’s most active,” the Carlsbad Current-Argus reports. “Domestic oil was trading at about $88 per barrel, up from about $85 a barrel a week ago, per data from Nasdaq. The increased value in oil was followed by growth in oil and gas rigs with the Permian Basin adding one rig in the past week for a nation-leading total of 293 rigs – an increase of 101 from a year ago, as of Friday per the latest data from Baker Hughes. New Mexico and Texas, which share the Permian, had 94 and 294 rigs, respectively – holding the top two rig counts in the nation, Baker Hughes reported. Earthstone Energy announced Monday it acquired lands in the eastern Midland Basin, a section of the greater Permian in West Texas, for about $860 million from Bighorn Permian Resources.”
Globe and Mail: Imperial Oil raises dividend amid highest level of crude production in more than 30 years
EMMA GRANEY, 2/1/22
“Imperial Oil Ltd. increased its quarterly dividend by more than 25 per cent Tuesday, reflecting a broader trend in Canada’s oil patch even as the company keeps a close eye on how inflation could hit its bottom line,” the Globe and Mail reports. “Imperial IMO-A announced Tuesday that its first-quarter dividend would rise to 34 cents a share from last quarter’s 27 cents, bolstered by rising oil prices and its highest level of crude production in more than 30 years. Imperial, like much of the energy sector, also had a marked bounce-back in demand for its products over the past 12 months, with gasoline and diesel hovering around 90 per cent to 95 per cent of prepandemic levels. “We continue to see industry demand trends pretty consistent with what we saw through 2021,” Imperial president and chief executive officer Brad Corson said on an investor call Tuesday.
IHS Markit: Greenhouse Gas Intensity of Canadian Oil Sands Production Continues to Decline Despite COVID-Induced Market Disruptions
2/1/22
“Despite significant COVID-19 led market disruptions the greenhouse gas (GHG) intensity of the Canadian oil sands declined again in 2020, confirming a long-term trend,” according to IHS Markit. The IHS Markit Oil Sands Dialogue analysis finds that GHG intensity fell to 69 kilograms of “carbon dioxide equivalent” per barrel (kgCO2e/bbl) in 2020, the most recent year that IHS Markit estimates are available. Since 2009 (the earliest year that IHS Markit records) the GHG intensity of oil sands production has declined 17 kgCO2e/bbl or 20%—an average decline of just over 1.5 kgCO2e/bbl per year. These latest findings, which are drawn from a forthcoming IHS Markit report, indicate that should the pace of reductions in GHG intensity continue, they are poised to overtake a slowing production growth profile and contribute to an absolute reduction in emissions within the next half decade… “Such a disruption would be expected to put upward pressure on GHG intensity by driving down facility utilization—using similar levels of energy but with fewer units produced. Yet GHG intensity still declined, and indications are that greater levels of reduction should be anticipated in the future,” said Kevin Birn, vice president, GHG estimation and chief Canadian oil market analyst, IHS Markit.”
CabinRadio: Do we know enough to release Alberta’s treated tailings?
MCKENNA HADLEY-BURKE, 2/1/22
“A federal plan to release treated tailings overlooks large gaps in our understanding of how that could affect human health, some experts and advocates say,” CabinRadio reports. “Denesuline Elder Francois Paulette, a member of the Smith’s Landing First Nation, believes “people should be very, very concerned” about the planned release of Alberta oilsands tailings water. Federal proposals would allow treated water used in the mining process to be discharged – a plan that has already prompted concern and skepticism from Indigenous communities downstream of the oilsands. “I have reenergized myself to campaign in opposition to this,” Paulette, a longtime treaty and Indigenous rights advocate, told CabinRadio. Paulette told CabinRadio he sees opportunities for Treaty First Nations to mount legal opposition to the planned release of treated tailings.”
CLIMATE FINANCE
Aspen Times: Guns, oil and tobacco unlikely in Pitkin County’s future portfolio
Jason Auslander, 2/1/22
“In a bid to promote social responsibility, Pitkin County’s future investments will not support companies that make most of their money from tobacco, guns or fossil fuels,” the Aspen Times reports. “All five Pitkin County commissioners praised the policy move Tuesday, which will come up for a vote and public hearing later this year. “I think Pitkin County should totally divest from those agencies (like oil companies),” said Commissioner Kelly McNicholas Kury. It’s “a small but powerful statement, and that’s what I’d like us to do.” “...However, the new investing policy — known by acronyms that stand for “Environmental, Social Governance” investing and “Socially Responsible Investing” — will serve as a guide for future investments, Driggers told the Times. Hughes told commissioners she will likely be bringing corporate investment options to them in the near future, though state law says they can only be from double-A-rated companies, and they most certainly won’t be fossil fuel-related… “Pitkin County earned $1.8 million in investment income in 2020, according to a memo from Driggers to commissioners.”
OPINION
FOX Business: Gas prices in California will soar following LA ban on new oil and gas wells, industry rep warns
By Talia Kaplan, Kelly O'Grady, 2/1/22
“California Independent Petroleum Association CEO Rock Zierman warned in an interview that aired on ‘Varney & Co.’ Tuesday that already high gas prices in Los Angeles will be even higher if oil is no longer allowed to be produced in the area,” according to FOX Business. “Zierman, who heads the group representing nearly 400 oil and gas industry entities, made the comment less than one week after the Los Angeles City Council approved a measure to ban new oil and gas wells and phase out existing ones. The move is the latest effort to curb the production and usage of fossil fuels in California as the state has been trying to meet climate goals and improve public health. Zierman stressed that the city council’s measure would not only raise gas prices, but will also eliminate jobs and make the region more dependent on foreign oil at a time when tension are brewing… "Any of the oil we don’t produce here has to be tankered in from a foreign country and as a result, we already pay the highest oil prices in the United States, which then gets turned into gasoline, and diesel and fuel - which are also the highest price in the entire country - and that is going to be exacerbated if we are no longer producing here," he warned on FOX Business.