Today’s Key Takeaways: Oregon tribe sues Biden Admin over offshore wind. Fracking ban and the price of oil Nova Minerals- focus on Alaska’s future. Senators file bill to stop court revocation of LNG permits. Alaska resource projects featured in presidential election.
Indian Tribes are suing the Biden-Harris administration over an offshore wind lease sale scheduled next month they argue will impact their way of life and the environment.
Biden-Harris’s environmental review concluded there would be no impacts, but the Tribes say the head of the government agency involved admitted in meetings that she was pressed by the White House to complete offshore wind projects.
The deep waters off Oregon would require floating wind platforms, which are even more expensive than wind turbines secured to the sea floor, both very expensive options for electricity generation.
The Tribes want the Court to grant a temporary restraining order, postponing the sale while proper studies and consultations are continued.
The Biden-Harris administration’s rush for expensive offshore wind energy is running into problems, cutting corners, and failing to adequately consult with those affected.
What would a U.S. fracking ban mean for the oil price? That’s the question Rigzone posed to Matt Willer, Managing Director of Capital Markets at Phoenix Group Holdings.
Responding to the query, Willer told Rigzone that such a ban would “put oil over $100 a barrel, or well beyond, very quickly”.
“If you ban fracking, you are squelching horizontal drilling,” Willer said, noting that “this is a considerable part of the U.S. energy mix with all the shale basins, etc., and it is the most efficient technology for oil recovery.”
“If you ban fracking, you would drastically tighten supply without addressing demand. The result will be an elevated oil price market, likely over $100 a barrel, based solely on supply-demand economics,” he added.
When Rigzone asked Willer what a fracking ban would mean for U.S. oil and gas, Willer said it “would mean the technology and innovation that has built the most efficient energy production in the world would be essentially discarded.” He warned that it “would also drastically slow the green energy movement the democrats are pushing.”
“It takes energy to make energy – it takes energy to make solar panels and wind turbines.” Willer said.
“If the cost of conventional energy is through the roof due to a fracking ban, energy costs will skyrocket; we will force an energy-fueled recession, a prospect that should concern us all, all while slowing all forms of energy evolution,” he added.
In a previous statement sent to Rigzone, Willer warned that a fracking ban “could pull 12 million barrels off the global market, almost 12 percent of global production”.
After recent court rulings overturning federal authorization permits for liquified natural gas projects on the South Texas border, two Texas senators have filed legislation that would prevent courts from revoking permits.
Republican U.S. Sens. Ted Cruz and John Cornyn on Friday announced they have filed the Protect LNG Act of 2024. If passed, it would ensure that courts cannot vacate previously authorized LNG permits issued by the Federal Energy Regulatory Commission.
A “court shall not set aside or vacate the permit, license, or approval issued to the covered facility but instead remand the matter to the relevant federal agency to resolve the violation,” the bill says. Exceptions are made for rulings by the U.S. Supreme Court.
The legislation also mandates that courts grant expedited decisions in relevant cases.
This would help to maintain Texas’ “energy dominance,” Cornyn said.
“This legislation will help crack down on frivolous lawsuits by left-wing climate activists who seek to weaponize our courts and threaten American energy,” Cornyn said in a statement.
Nova Minerals Ltd (ASX:NVA, NASDAQ:NVA) has delivered its 2024 Sustainability Report, which showcases the company’s abiding commitment to environmental, sociocultural, and economic sustainability at the Estelle Gold Project in Alaska along with its other endeavours.
The report outlined the company’s approach to balancing mineral exploration and development with long-term benefits for local communities and ecosystems.
Sustainable production
The company has a multi-pronged approach to its business, with gold, antimony, lithium, and other critical minerals, along with eco-friendly transport-related plays in the mix – all of which are geared towards sustainable production and clean technology end markets.
The Estelle Gold Project in Alaska positions it as North America’s next major gold and critical minerals district with the ability to leverage both the emerging gold and antimony bull markets.
Along with a global 9.9-million-ounce gold resource, Nova has also discovered significant deposits of stibnite (antimony) at multiple locations across its claims.
Antimony is used as a hardening component in almost all batteries and solar panels, is a flame retardant and an important component in munitions.
Nova CEO Christopher Gerteisen was invited to both Washington DC and Juneau, Alaska’s state capital, numerous times in 2024 to meet with Alaska’s congressional delegation, along with several federal departments, divisions, and senate and congressional committees to discuss how the Estelle project could help shore up the US critical minerals supply chain.
Unique Alaskan landscape
Nova CEO Christopher Gerteisen stressed the company’s focus on three core pillars of sustainability: environmental, sociocultural, and economic.
“Our natural surroundings must continue to support clean air and water, healthy habitats for fish and wildlife, and the beautiful landscapes that all Alaskans enjoy,” he said, recognizing the importance of preserving the unique Alaskan wilderness that is home to the Estelle Gold Project.
On sociocultural sustainability, the company says it prioritizes respecting and maintaining the cultural heritage of local communities.
“Ultimately, the relationship between people and the land must be maintained,” Gerteisen said.
The report also emphasizes the company’s economic impact on the region, with Nova committed to providing local employment opportunities and supporting regional economic growth through hiring and contracting preferences for Alaska Native Corporations and businesses.
“We will strive to provide living wage jobs close to home that will support families in our region,” Gerteisen explained.
The report reveals new discoveries of gold and critical minerals essential for national defense and clean energy technologies.
These developments have drawn attention from Washington, DC, due to their potential contribution to national security and the global transition to clean energy.
“Sustainability continues to be our goal, working in lock step with our project partners and neighboring communities for the good of Alaska, our country, and our world,” Gerteisen concluded.
Major Alaska resource projects, and the land they could be built on, may be at stake in the presidential election.
They include drilling in the Arctic National Wildlife Refuge and elsewhere in Alaska, logging in the Tongass National Forest, and cutting a 200-mile road through Alaska wilderness to access the Ambler mining district.
President Joe Biden’s administration has put the brakes on those and other major Alaska resource development projects, reversing efforts by former President Donald Trump to advance those initiatives.
Trump, with his aggressive focus on resource extraction, can be expected to renew his efforts in Alaska if he wins office, former officials say. But they add that it won’t be easy to reverse many of Biden’s actions, especially if Trump overhauls the federal workforce needed to properly make changes, they say.
If Vice President Kamala Harris wins, she’ll likely retain many of Biden’s actions in Alaska, they say. But her administration could still be dealing with major Alaska issues, such as a second oil and gas lease sale in the 19.6-million-acre Arctic refuge, they say.
The election also raises questions about the fate of other perennial Alaska projects, such as the Pebble mineral prospect that was stopped by the Environmental Protection Agency last year, or the giant Willow oil field that was approved by the Biden administration.
For years, Alaska’s big projects and land battles have been subject to shifting politics, depending on which party’s candidate occupies the White House. The back-and-forth has a chilling effect on investment in the state, making it difficult for companies to know whether a prospect has any chance of winning federal approval, resource advocates say.
The Biden-Harris Administration’s Army Corps of Engineers is attempting to seize control of a Utah-sized region of Alaska’s North Slope.
The Corps argument is that because the ground is permanently frozen to depths of up to 2000 feet, it constitutes water over which it asserts control under Clean Water Act jurisdiction.
This assertion appears to run counter to the Supreme Court’s decision limiting the federal government’s control over land by a backdoor expansion of what constitutes “water of the United States.”
The case, Sackett v. EPA, concluded the federal government’s assertion over waters belonging to the United States had been grossly exaggerated and narrowed the law’s scope.
Alaska views the new power grab for control over lands in its state as one of several actions taken by the Biden-Harris administration to limit the state’s economic potential.
The Biden-Harris administration has claimed to have jurisdiction over a significant portion of wetlands on Alaska’s North Slope. The Army Corps of Engineers is indicating that extensive areas across the nation, including wetlands, can still be governed by the Clean Water Act, despite the Supreme Court’s 2023 decision in Sackett v. EPA, which significantly limited the law’s applicability.
This assertion by the Army Corps casts a broad jurisdictional net over the entire Arctic region. The Supreme Court determined that for wetlands to qualify for federal oversight as waters of the United States, they must be “relatively permanent” and exhibit a continuous surface connection to larger bodies of water to the extent that they are “indistinguishable” from them. This ruling has effectively removed federal oversight from many wetlands and waterways, particularly in arid regions like Colorado, where state officials report that around 90 percent of the state’s wetlands are no longer federally regulated.
In contrast, the Biden-Harris administration contends in legal documents that any “physical” connection between a wetland and navigable waters is adequate to establish the continuous surface link necessary for federal jurisdiction. The Army Corps is extending this interpretation to a Utah-sized area of Alaska’s North Slope, primarily composed of moist permafrost that remains frozen for most of the year, reaching depths of up to 2,000 feet. The Army Corps claims that nearly all wetlands and other waters on Alaska’s Arctic Coastal Plain have a continuous surface connection to a larger waterway, making it “safe to assume that the vast majority of aquatic resources in this region will be considered waters of the US.”
The Army Corps seems to be trying to re-establish the “significant nexus” test, which the high court tossed out in Sackett, said Larry Liebesman, a senior adviser at the environmental and water permitting firm Dawson & Associates. Under the test, isolated waters and wetlands fell under Clean Water Act jurisdiction if they had hydrological connections that allowed pollution to affect the biology and chemistry of a larger distant navigable water body. Justice Samuel Alito wrote in Sackett that the significant nexus test puts “a staggering array of homeowners at risk of criminal prosecution for such mundane activities as moving dirt.”
The Army Corps is intensifying the legal discussion about whether the presence of water is necessary to determine if wetlands maintain a continuous surface connection to a river or lake, according to Anna Wildeman, counsel at Troutman Pepper Hamilton Sanders LLP in Washington, D.C., and a former official in the Trump administration’s EPA Office of Water. “The agencies are acting improperly and overstepping the boundaries set by Sackett,” Wildeman said. “State leaders in Alaska have not hesitated to challenge this administration when they believe federal authority is intruding on state rights.”
Kevin Minoli, a partner at Alston & Bird LLP, cautioned that the Army Corps’ statement is not an official legal opinion. The Army Corps’ approach to determining Clean Water Act jurisdiction in Alaska may not apply to the rest of the United States because the state’s Arctic hydrology and climate are unique, according to Minoli. That unique hydrology puts the Army Corps’ approach on solid legal ground, said Dave Owen, an environmental law professor at the University of California College of the Law in San Francisco and supporter of government control.
“Pretty much every wetland will connect to streams or rivers, and those stream and river networks will flow continuously to the ocean,” he said. “The combination of a very cold climate and poorly drained permafrost makes the North Slope the kind of landscape where those interconnections are a common feature.”
Currently, twenty-seven states, along with various trade groups and private landowners, are contesting the EPA’s and Army Corps’ regulations implementing Sackett in at least four federal lawsuits.
Conclusion
The Biden-Harris Army Corps of Engineers is hinting at reviving the ‘significant nexus’ test to claim Clean Water Act jurisdiction over most wetlands on Alaska’s North Slope. Critics argue that the agency is ignoring the Supreme Court’s ruling in Sackett vs. EPA. The Supreme Court justices ruled that for wetlands to receive federal protections as waters of the United States, they must be “relatively permanent,” and have a continuous surface connection with larger waterways to such a degree that the wetlands must be “indistinguishable” from them.
Litigation is already proceeding in at least four federal lawsuits over the Biden-Harris administration’s implementation of the Sackett ruling. The Army Corps assertion is extremely vexing for Alaska, which wants to have the prerogative to make decisions for its state and its residents.
With cheap gas-fired power now unavailable, the biggest utility in Fairbanks has shelved plans to shut down one of its coal-fired plants
Southcentral Alaska’s natural gas crunch is boosting demand for coal-fired power hundreds of miles inland, a sign that a looming supply crisis will have far-reaching consequences across Alaska.
In a late-August filing with the state’s utility regulator, the electrical cooperative for Fairbanks said it had signed a six-year contract with Usibelli Coal Mine to supply Healy 2, a troubled coal-fired power plant.
Until February, Fairbanks’ cooperative, Golden Valley Electric Association, had planned to shut down Healy 2 because of its high maintenance and operating costs.
“The greater concern now is that the natural gas shortage in the Cook Inlet will worsen, resulting in a potentially critical situation for the Alaska Railbelt utilities starting in 2027,” GVEA said in the filing.
Since 2022, the largest natural gas supplier in Southcentral Alaska has warned about an impending supply crunch for the region.
Natural gas is the principal source of home heating and electricity in Anchorage and the surrounding area, and Cook Inlet has ample supplies of underground gas, but gas-sellers have failed to drill enough new wells to keep up with demand.
Experts expect that by the end of the decade, there won’t be enough natural gas to meet demand.
The effects of that crisis stretch from Homer to Fairbanks and Delta Junction, encompassing more than two-thirds of Alaska’s residents.
“It’s not just a Southcentral issue. It certainly impacts us here up in Fairbanks as well,” said Ashley Bradish, GVEA’s director of external affairs.
While many insurers have reduced their investments in fossil fuel companies, State Farm, the largest U.S. home and auto insurer, and Berkshire Hathaway’s insurance companies have boosted their investments in oil and gas firms over the past decade, an analysis by The Wall Street Journal showed on Wednesday.
Fossil fuel financing and insurance have come under scrutiny in recent years as ESG policies have become mainstream for many investors.
The Journal has now analyzed annual filings of insurers’ investments in stocks and bonds obtained from the National Association of Insurance Commissioners, a non-governmental organization that supports U.S. insurance regulators.
Between 2014 and 2023, State Farm and Berkshire’s insurers boosted their investments in oil and gas firms, even if more than half of the 236 property-and-casualty insurers in the Journal’s analysis reduced their spending on stocks and bonds issued by fossil fuel companies.
State Farm, which has invested billions of U.S. dollars in stocks and bonds of companies including ExxonMobil, Chevron, and Diamondback Energy, has raised the share of fossil fuel investments in its $142.7 billion portfolio to 3.6% in 2023, up from 2.6% back in 2014, the Journal’s analysis found.
Berkshire Hathaway’s insurance firms, for their part, reported they spent $39.9 billion on fossil fuels stocks and bonds in 2023. This has raised the share of investments in fossil fuels to more than a fifth of their overall $183 billion in holdings, according to the Journal’s analysis.
The big spending on fossil fuels from Berkshire Hathaway is not surprising, considering Warren Buffett’s bet on Occidental, in which his conglomerate has heavily invested over the past year.
As a result of the rising fossil fuel investments by Berkshire Hathaway and State Farm, the overall exposure of the U.S. property-and-casualty insurance industry to fossil fuels rose to 4.4% of portfolios in 2023. This compares with 3.8% of investments in portfolios in fossil fuels in 2014, the WSJ analysis found.
Russian LNG Vessel Pioneer: The sanctioned Russian LNG ship Pioneer is navigating through the Suez Canal for the first time, aiming to reach Asia via Yemeni waters. This marks a significant move as it is the first full LNG cargo attempting this route since disruptions began due to Houthi militant activities backed by Iran.
Arctic LNG 2 Challenges: Russia’s Arctic LNG 2 project faces severe constraints with early ice build-up limiting export routes. US sanctions have restricted access to ice-class tankers, forcing reliance on lighter vessels and delaying cargo loadings. The potential shutdown of Arctic LNG 2 due to ongoing sanctions poses a threat to Russia’s LNG export ambitions.
Impact on Japan’s LNG Supply: US sanctions on Arctic LNG 2 have curtailed supply options for Japanese companies like Mitsui and Jogmec, who hold stakes in the project. Additionally, future sanctions on Russia’s Sakhalin-2 plant could further constrain Japan’s LNG supply, necessitating diversification of sources.
The U.S. Senate has confirmed Michael Sfraga of Fairbanks to be the nation’s first ambassador-at-large for the Arctic.
The vote was 55-36, with nine Republicans joining Democrats to vote yes.
Sen. Lisa Murkowski was the chief advocate for creating the ambassador position and Sfraga’s biggest champion in the Senate.
“Mike is probably the most recognized go-to Arctic expert that we have, not just in Alaska, but around the country,” she said, outside the Senate chamber before the vote. “I go to a lot of Arctic convenings. Mike Sfraga is there at all of them.”
His expertise extends to Arctic research, policy, and national security, she said. He’s in Helsinki now for a security conference and Murkowski said he’ll attend another in Warsaw next week.
The legacy media frequently report that the energy transition is happening, and it's faster than ever. Never, in any of these articles, do they mention that, oh by the way, we're using more fossil fuels than ever. pic.twitter.com/GlgiXDiNtC
Today’s Key Takeaways: Nuclear energy attracting world’s top banks. Doyon subsidiary pursues 20% of North Slope pipeline. Capturing CO2 at Alaska Nikolai project. Democrats outspending Republicans.
More than a dozen of the largest banks in the world are pledging their support to nuclear power, supporting the goal of the COP28 summit to triple nuclear capacity by 2050, the Financial Times reports.
Goldman Sachs, Bank of America, Barclays, BNP Paribas, Citi, Morgan Stanley, Société Générale, Crédit Agricole CIB, Abu Dhabi Commercial Bank, Ares Management, Brookfield, Guggenheim Securities, Rothschild & Co, and Segra Capital Management are set to pledge at a New York event on Monday their support to boosting global nuclear power capacity and generation as a means to achieving net-zero.
At the COP28 climate summit in Dubai at the end of last year, the United States and 21 other countries pledged to triple nuclear energy capacity by 2050, saying incorporating more nuclear power in their energy mix is critical for achieving their net zero goals in the coming decades.
The United States, alongside Britain, France, Canada, Sweden, South Korea, Ghana, and the United Arab Emirates (UAE), among others, signed the declaration at the COP28 climate summit.
The world’s biggest banks are not expected to go into details about what they would do in regard to the pledge, but analysts tell FT that the mere fact that they are now publicly supporting nuclear energy would be an important recognition that nuclear will play a crucial role in the decarbonization of the global energy systems.
There is “no scenario” in which net zero could be reached by 2050 without nuclear energy, BNP told FT, quoting the UN’s Intergovernmental Panel on Climate Change. Barclays, for its part, told FT that it supports nuclear power as it could be the backup solution for intermittent solar and wind power generation.
Despite being an industry notoriously known for years of delays and huge cost overruns, a global nuclear power renaissance is underway.
The comeback of nuclear energy is expected to drive a record-high electricity generation from nuclear in 2025, the International Energy Agency (IEA) said early this year
OIL:
Doyon subsidiary wants 20% of key North Slope pipeline Nathaniel Herz, Northern Journal, September 18, 2024
A subsidiary of Doyon, the Fairbanks-based Alaska Native corporation, is asking state regulators for permission to acquire 20% of a major North Slope pipeline from a ConocoPhillips affiliate.
The two companies applied Wednesday to the RCA for permission to transfer the minority share of the Kuparuk pipeline, which currently moves up to 175,000 barrels of oil a day.
Earlier this month, another minority owner of the pipeline, a subsidiary of Chevron, also asked for regulatory permission to transfer its 5% interest to a small, Texas-based firm, Pontem.
Doyon already has significant interests in energy-related businesses, including a pipeline company that moves oil between the trans-Alaska pipeline system and a refinery.
The RCA application says Doyon’s subsidiary will assume “full responsibility and liability” for its newly owned share of the pipeline, including for decommissioning costs. But ConocoPhillips, whose affiliate will own 75% of the pipeline after the transaction, will continue to manage operations.
Alaska Energy Metals has partnered with the Colorado School of Mines and Virginia Polytechnic Institute to answer that question.
Alaska Energy Metals Sept. 18 announced that it has partnered with the Colorado School of Mines and Virginia Polytechnic Institute to determine how much carbon dioxide a mine at its Nikolai project in Alaska could capture and store while also providing a domestic supply of nickel, copper, cobalt, and platinum group metals (PGMs) for the energy transition.
Research has shown that ultramafic rocks, such as those found within the more than 8-billion-pound Eureka nickel deposit at Nikolai, are enriched with magnesium minerals that react with CO2 in the atmosphere. This interaction locks up the CO2 in carbonate rocks and stores the greenhouse gas for geological scales of time.
Under natural conditions, this carbon sequestration process is limited due to a lack of contact between atmospheric CO2 and ultramafic rocks that are mostly buried beneath Earth’s surface. Digging up these CO2-absorbing rocks and then crushing them to extract the desired minerals creates the ideal exposure needed for the rock-forming carbon sequestration process to take place.
Last year, the Colorado School Mines received a grant from the U.S. Department of Energy’s Advanced Research Projects Agency-Energy (ARPA-E) to develop a novel technological solution for assessing the CO2-absorbing potential of mining ultramafic deposits enriched with nickel, copper, cobalt, and PGMs. The cutting-edge scanning technology and advanced machine learning algorithms developed under this program are now being applied to Alaska Energy Metals’ Nikolai project.
“We are extremely excited to engage in this partnership with Alaska Energy Metals on a real-life project that will potentially provide a secure domestic source of energy-related metals while simultaneously sequester carbon to slow global warming,” said Colorado School of Mines Professor of Economic Geology Thomas Monecke.
Democrats are outspending Republicans on political ads by about a half-billion dollars since Aug. 1, according to data from analytics platform AdImpact.
By the numbers: As of Sept. 20, Democrats have spent $1.8 billion on ads booked for Aug. 1 through Nov. 5, compared to $1.3 billion for Republicans.
That includes spending by campaigns (from the presidential candidates down to lower-ballot hopefuls) as well as by outside groups.
Campaigns alone, Democrats have spent nearly $700 million, compared to almost $400 million by Republicans.
Zoom in: Both parties are spending the most on ads running in Philadelphia, Detroit, and Phoenix, among the metro areas tracked by AdImpact.
What’s next: With about a month and a half until Election Day, there’s no end in sight for campaign ads — especially if you live in a swing state.
In May, the BLM released their final version of a new NPR-A rule that was built on a flawed process and ignored the input of elected leaders and North Slope communities.
Not willing to rest on their laurels, BLM published a Request For Information (RFI), inserting a new twist into the final rule saga that is currently tied up in the courts and being challenged by Alaska oil and gas operators, the State of Alaska, and North Slope organizations.
This new approach is unclear and a departure from past practices. Asking for comments to be emailed, instead of using a public, accessible platform allows the BLM to solicit input in secret and never make it public. This certainly supports the argument that BLM continually ignores the input of North Slope residents and elected officials.
It seems like only yesterday that Secretary of Interior Haaland said ““The White House Council on Native American Affairs represents an important commitment to strengthen Tribal sovereignty, uphold our commitment to Tribal Nations, and honor the United States’ nation-to-nation relationships. Part of that commitment includes ensuring that Tribal leaders have a seat at the table and can work directly with federal leaders on issues of importance.”
Many trade associations, unions and private sector companies involved in the NPR-A didn’t appreciate BLM’s backdoor approach to push new policies and restrictions without providing clear criteria to evaluate what they seek and what the outcome will be.
Alaska Congressional Delegation: “BLM’s actions are simply not a reasonable interpretation of federal law, let alone the best interpretation of federal law, as the agency has dramatically upended its management mission in the NPR-A from one led by responsible resource development to one defined by relentless conservation,” Alaska’s Congressional Delegation wrote. “We therefore request that BLM immediately abandon the RFI process. BLM should have allowed the courts to review and make a decision on the multiple challenges to the final rule before issuing the RFI and used the next IAP process to decide the future of Special Areas within the NPR-A. The process by which BLM is undertaking the RFI is not transparent, will hide relevant information from policymakers and the public, and any decisions based on it will be unilaterally made behind closed doors without a true public process.”
Armstrong Oil and Gas: “Even the BLM itself recognized that the decisions in the 2022 Petroleum Reserve IAP Record of Decision makes available for leasing the minimum amount of public lands necessary to allow for oil and gas development while providing necessary protection for subsistence users and resources. Based on BLM’s own statements within the 2022 IAP, it has already reduced the amount of lands available to oil and gas development to the minimum potentially allowed under the Petroleum Reserve’s authorizing act.”
ConocoPhillips Alaska: “BLM’s new regulations are unlawful, as is the process BLM apparently envisions with the RFI. It has strayed from the law and the IAP, diminished public engagement, and upset the balance that supports the leasing program and serves the public interest. BLM 3 should adhere to the process that it has already established as a matter of law and precedent, and to serve the value of transparency.”
Alaska Oil and Gas Association: “This current approach not only contradicts the statutory framework established by Congress but also threatens the responsible development of vital oil and gas resources in Alaska,” said Kara Moriarty, AOGA president and CEO. “We urge BLM to refrain from taking further action until the litigation surrounding the new NPR-A rule is resolved, and to commit to a transparent, legal process that balances development with the protection of critical resources.”
These organizations, and others, urged BLM to halt the RFI process, wait for the courts to rule on the NPR-A rule, and adhere to a transparent, tried-and-true approach that respects Alaska’s communities and industries.
