NEWS OF THE DAY:
Alaska lawmakers reach tentative deal on budget, dividend
Becky Bohrer, Associated Press, June 14, 2021
Alaska budget negotiators reached a tentative agreement Sunday on a state spending package that includes an estimated $1,100 dividend for residents this year.
But the check size could be cut to $525 a person if the House or Senate fails to muster sufficient support surrounding use of budget reserve funds to help pay for the dividends, according to information provided by the Legislative Finance Division.
Dividends have typically been paid using earnings from the state’s oil-wealth fund, the Alaska Permanent Fund. But the budget compromise reached Sunday would cobble together money for dividends from various sources, including the constitutional budget reserve fund that requires three-fourths support in each the House and Senate to tap.
Sen. Bert Stedman, one of the lead budget negotiators, said the budget maneuver “certainly encourages some folks to seriously consider what … position they’re going to take” on the constitutional budget reserve.
Alaska Gov. Mike Dunleavy, on social media, said with the conference committee proposal the dividend is again “a political football subject to the whims of politicians” and called it proof that a dividend should be enshrined in the state constitution.
A longstanding formula for calculating dividends was last used in 2015, and dividends have become a perennial and politically charged debate. Despite various ideas that have been floated, including from Dunleavy, lawmakers have yet to coalesce behind a plan to possibly reshape the program long term. A number of lawmakers have pushed back against the assumptions underpinning Dunleavy’s dividend proposal, which has seen little momentum during the current special session.
Lawmakers in 2018 began using permanent fund earnings to help pay for government and sought to limit withdrawal amounts for dividends and government expenses. One of the debates this year has been over whether to exceed to the draw amount. The limit would be maintained under the budget proposal that advanced Sunday, said Alexei Painter, director of the Legislative Finance Division.
Rep. Bart LeBon, a member of the House’s minority Republican caucus who served on the budget conference committee, supported the dividend language, which he said was “probably more my position” than a caucus position. He said he was concerned about exceeding the draw limit.
Rep. Mike Prax, a fellow Republican who was visiting with LeBon in LeBon’s office after the conference committee meeting, expressed concerns with the dividend approach in the tentative agreement.
“My thought is, if we don’t have a commitment, really, to solve the long-term problem, there’s no point in agreeing to a short-term solution,” he said.
The budget package that advanced from the six-member conference committee must go to the full House and Senate for consideration. Senate President Peter Micciche and House Speaker Louise Stutes said votes in their respective chambers could happen Tuesday.
Lawmakers have until Friday to complete their work in this special session, called by Dunleavy in part to finish the budget. The new fiscal year starts July 1.
OIL:
Shell said to consider sale of largest oil field in the U.S., valued at up to $10 billion
Riley Griffin, World Oil, June 14, 2021
Royal Dutch Shell Plc is reviewing its holdings in the largest oil field in the U.S., a possible sale that could raise as much as $10 billion, according to Reuters.
The potential sale could include all of Shell’s 260,000 acres in the Permian Basin, Reuters reported citing unidentified people familiar with the matter. Shell declined to comment on Reuters’ report.
The oil and gas behemoth is under pressure to accelerate carbon emissions cuts after a Dutch court ruled last month that the company’s climate plans didn’t go far enough. The order to cut emissions faster and more drastically than planned is likely to have far-reaching consequences on the sector.
Related story: Shell loses precedent-setting climate change case in Dutch court
Shell, which has 92,000 employees spanning 70 countries, had planned to cut emissions by 20% by 2030. The court in The Hague, however, ordered it to reduce its absolute emissions by 45% compared with 2019 levels, after the Dutch arm of Friends of the Earth sued Shell for violating human rights by contributing to global warming.
Chief Executive Officer Ben van Beurden said Shell expects to appeal the verdict, and that the company has been unfairly targeted. Still, the CEO described a plan to take “bold but measured” steps to cut emissions.
GAS:
Big Oil firms bid for Qatar LNG project despite reduced returns – Reuters
Carl Surran, Seeking Alpha, June 14, 2021
- Six major western energy companies are seeking to partner in the expansion of Qatar’s liquefied natural gas production, Reuters reports, citing industry sources.
- Exxon Mobil (NYSE:XOM), Royal Dutch Shell (RDS.A, RDS.B), TotalEnergies (NYSE:TOT) and ConocoPhillips (NYSE:COP), which are part of Qatar’s existing LNG production, were joined by new entrants Chevron (NYSE:CVX) and Eni (NYSE:E) in submitting bids on May 24 for the expansion project, according to the report.
- Qatar Petroleum is moving ahead alone with the development of the nearly $30B North Field expansion project, but it reportedly wants to partner with western majors to help share the financial risk of the development and help sell the additional volumes of LNG it will produce.
- The interest in the Qatari expansion comes despite relatively low returns: QP offered international bidders returns of 8-10% on their investment, down from 15-20% returns Exxon, Total, Shell and Conoco have seen from the early LNG facilities, according to the report.
- The results of the tender process are not expected to be announced before September.
- In March, Qatar decided it wanted to become the sole owner of the Qatargas 1 LNG project, and did not renew its 25-year joint venture agreement with foreign partners.
MINING:
US supply chain plan, Alaska2023 aligned
Shane Lasley, North of 60 Mining News, June 11, 2021
Ucore Rare Metals Inc. believes the Biden administration’s newly announced strategy to strengthen America’s supply chains aligns with its own vision to disrupt China’s dominance of the rare earth elements supply chain in the United States.
“We are very pleased with the White House’s concern for REEs and its efforts to spur the domestic production of critical materials,” said Ucore Rare Metals Chairman and CEO Pat Ryan.
Based on the feedback from a 100-day American supply chains assessment ordered by President Joe Biden in February, the White House has begun to form a strategy for the critical minerals and metals that feed into nearly every U.S. supply chain.
This includes encouraging environmentally and socially sound critical mineral production and processing projects on American soil and abroad.
On the domestic front, a working group of federal agencies led by the U.S. Department of Interior has been instructed to identify sites where critical minerals can be responsibly produced and processed in the U.S.
The White House, however, wants to ensure that any such critical mineral projects are developed at the highest standards for environmental protections and is assembling a second federal interagency team to identify gaps in mining-related statutes and regulations that may need to be updated by Congress.
The Biden administration also plans to invest billions of dollars into domestic and international production of critical minerals, especially rare earths and battery metals vital to renewable energy and national defense.
This continued support for the Department of Defense to deploy Defense Production Act Title 3 incentives – grants, loans, loan guarantees, and offtake agreements – for sustainably-produced strategic and critical materials in the U.S. is among the supply chain investments that could benefit Ucore and its vision.
In 2019, former President Donald Trump used presidential powers under this act to authorize the Pentagon to pursue the reestablishment of a U.S. rare earths mines-to-magnets supply chain.
Under the Trump administration, the Pentagon focused largely on the separation and processing of rare earths, a difficult and key segment of the rare earths supply chain.
This dovetails well with Alaska2023, Ucore’s strategy to develop the Alaska Strategic Metals Complex, a heavy rare earths processing facility in Southeast Alaska by 2023 and a separate SMC that will produce light REEs.
Though often referred to as a single entity, rare earths are a group of 17 elements – the 15 lanthanides that make up the second row from the bottom on the periodic table plus yttrium and scandium.
Light REEs make up the first seven elements of the lanthanide series and include lanthanum, for which the series gets its name; cerium, used for polishing high-quality optical surfaces; praseodymium, valued for its magnetic and optical properties; and neodymium, an extremely magnetic element.
The remaining eight lanthanides are considered heavy REEs, which are less abundant in most deposits and tend to be more valuable, including terbium and dysprosium used in the magnets in a wide array of consumer goods and military hardware.
Ucore’s heavy and light rare earth processing facilities will feature RapidSX, an REE separation technology developed by its subsidiary, Innovation Metals Corp.
The RapidSX technology represents an enormous upgrade and modernization of the conventional solvent extraction technology that has been the standard for separating rare earths for more than 40 years. While effective, traditional solvent extraction sometimes takes hundreds of stages to extract all the rare earths from a solution containing the 17 notoriously interlocked elements.
Utilizing a column-based platform developed by Gareth Hatch and his team at Innovation Metals, RapidSX reduces the number of process steps required in each SX circuit by 85 to 90%. This reduces the time, cost, and environmental footprint when compared to the solvent extraction techniques popularized in China, which has much lower labor costs and lackluster environmental standards.
“China has long dominated the REE supply chain, but with the US government’s help, we can and will use our groundbreaking 21st century separation technology, RapidSX, to bring control back into the hands of Americans,” said Ryan.
In the longer term, Ucore plans to develop a mine at Bokan Mountain, an REE and critical minerals project on Prince of Wales Island and only about 35 miles away from the planned Alaska SMC.
According to a resource calculation completed in 2019, Bokan Mountain hosts roughly 31,722 metric tons of rare earth oxides, 17,715 metric tons titanium dioxide, 9,001 metric tons zirconium, 2,205 metric tons niobium, 464 metric tons vanadium, 231 metric tons beryllium, and 178 metric tons hafnium in the indicated category.
All of these metals are considered critical to the United States and would feed into renewable energy, electric vehicle, and other industrial supply chains the White House hopes to make more “resilient, diverse, and secure.”
“Our Alaska2023 business model is founded on this transformative technology and the development of a resilient US supply chain through the development of two REE separation plants and ultimately a HREE mine at Bokan Mountain Alaska – the very definition of US resiliency,” said Ryan.
POLITICS:
Climate reality collides with rhetoric at the G7 summit
Andrew Freedman, Axios, June 14, 2021
Leaders of the G7 agreed to a sweeping new agenda over the weekend. But while the communique they issued is lofty in goals, it lacks crucial details on climate.
Why it matters: The G7’s paucity of specifics on climate finance and domestic coal consumption, in particular, calls into question the ability of the wealthiest nations to take sufficient action on global warming.
- This comes as experts warn that time is running out to prevent some of the most damaging climate effects.
- In addition, the G7 outcome boosts pressure on the UN climate summit in Glasgow this November, as negotiators could enter the meeting with tensions between rich and poor countries.
Details: The G7 communique is notable for weaving climate throughout its many goals. However:
- While countries agreed to boost funding for climate finance abroad, they did not provide many specific figures or approach the scale of spending that they first raised in 2009 and affirmed in 2015, which was $100 billion annually starting in 2020.
- This missing climate finance commitment portends trouble for the climate summit, known as COP26.
- While countries committed to ending new government support for coal plants abroad without capture and storage by the end of this year, they did not provide an end date for their coal use domestically. This could reduce their leverage with China, the top coal consumer.
Yes, but: The U.S. does have a 100% clean power target by 2035.
Context: The closely watched G7 summit is the latest sign that having lofty ambitions on global warming and creating tangible, on-the-ground carbon-cutting steps are two different things.
- In the U.S., for example, major climate legislation may not get through Congress as previously anticipated.
- Global carbon emissions have already bounced back to pre-pandemic levels.
- Last week, the International Energy Agency stated that oil demand will have already completely recovered from the pandemic by the end of next year, a departure from the organization’s pathway for a net-zero emissions future.
- Other new data shows China’s oil demand has returned to pre-pandemic levels, a signal of what may take place elsewhere as coronavirus restrictions are loosened.
What they’re saying: Rachel Kyte, dean of the Fletcher School at Tufts University, said countries disappointingly “punted” on climate finance.
- “The $100 billion has to be taken off the table, and a new commitment made for 2025 and later, because of its political symbolism, as well as the whole concept of promises made, promises kept from the developed world,” she told Axios.
- “We seem to be acting like we’ve got all this time in the world, and we don’t.”
CLIMATE CHANGE:
‘Greatest Threat’? Most Voters Reject Biden’s Global Warming Claim
Rasmussen Reports, June 14, 2021
Less than a third of voters agree with President Joe Biden’s recent claim that global warming is America’s “the greatest threat,” and few are willing to pay more taxes to fight such a threat.
The latest Rasmussen Reports national telephone and online survey finds that only 29% of Likely U.S. Voters agree with Biden’s statement that “the greatest threat facing America.” Fifty-four percent (54%) disagree with Biden’s claim about global warming and 17% are not sure. (To see survey question wording, click here.)
In a speech last week to U.S. troops stationed in England, Biden said that, after he was elected vice president in 2008, the Joint Chiefs of Staff warned him and President Barack Obama that global warming was “the greatest threat facing America.”
Not even a majority of Democratic voters agree with Biden’s assessment. Forty-two percent (42%) of Democrats believe global warming is “the greatest threat facing America,” while 33% don’t believe it and 25% are not sure. Majorities of both Republicans (76%) and voters not affiliated with either major party (56%) don’t think global warming is “the greatest threat facing America.”
The survey of 900 U.S. Likely Voters was conducted on June 10 and 13, 2021 by Rasmussen Reports. The margin of sampling error is +/- 3 percentage points with a 95% level of confidence. Field work for all Rasmussen Reports surveys is conducted by Pulse Opinion Research, LLC. See methodology.
When asked how much they would be willing to pay in higher taxes and utility costs to fight global warming, 43% of Likely Voters say they’d pay nothing, while 19% are willing to pay $100 more a year. Twenty-eight percent (28%) would be willing to pay an extra $300 year or more in taxes and higher utility costs to fight global warming, including 10% who’d pay $1,000 or more. Those findings are consistent with earlier surveys; three years ago, 39% of voters said they weren’t willing to pay anything to fight global warming.
Forty-three percent (43%) of voters believe the federal government does too little to fight global warming, while 33% think the government does too much. Fifteen percent (15%) say the level of federal action on global warming is about right and 10% are not sure.
Even though Democrats are more likely than Republicans or unaffiliated voters to agree with Biden that global warming is “the greatest threat facing America,” only 43% of Democratic voters say they’d be willing to pay an extra $300 a year or more to fight the problem. Eleven percent (11%) of Republicans and 29% of unaffiliated voters would be willing to pay an extra $300 or more annually in higher taxes and utility costs to fight global warming.
The issue of paying more to fight global warming divides voters along lines of economic class. A majority (53%) of those earning less than $30,000 a year say they wouldn’t pay anything to fight global warming. Fewer than 10% of those earning less than $100,000 a year would be willing to pay an extra $1,000 year or more in taxes and higher utility costs to fight global warming. Among those earning $200,000 a year or more, however, 38% would be willing to pay an extra $1,000 a year to fight global warming.
Forty percent (40%) of voters under 40 agree with Biden that global warming is “the greatest threat facing America,” but only 21% of those ages 40-64 and 28% of those 65 and older agree.
Even among voters who agree with Biden that global warming is “the greatest threat facing America,” 16% say they wouldn’t be willing to pay anything more a year in taxes or higher utility costs to fight the problem, while just 20% would be willing to pay $1,000 or more annually.
Most viewers of MSNBC and CNN believe climate change could doom mankind to extinction within 100 years, and viewers of those networks are also likely to overestimate the amount of global warming that has already occurred.
On his first day in office, President Joe Biden signed an executive order to have the United States rejoin the Paris climate agreement, but most voters believe Biden’s decision will mean lost jobs and higher bills for Americans.