The Trump administration threw its weight behind oil companies on Monday in a Supreme Court dispute that could affect climate litigation across the country.
In a new amicus brief, Justice Department lawyers urged the high court to side with BP Plc, Exxon Mobil Corp., and others in a highly technical dispute involving appellate review of a jurisdictional fight in Baltimore’s climate case against the industry.
Government lawyers also touched on an underlying debate in the case: whether claims from Baltimore and similar plaintiffs belong in state or federal court.
A speech Friday by Esther George, president of the Federal Reserve Bank of Kansas City, offers an interesting high-level look at the economic influence of gasoline prices and why it may never be the same.
The big picture: Gasoline prices account for a smaller share of household spending than they once did — about 4% in the 1980s to roughly 2% last year, though it’s much higher for low-income families.
The intrigue: The pandemic is changing the picture even more. Per George, “The COVID-19 shock could further loosen the grip of gasoline prices on consumers’ budgets and reduce the already lowered sensitivity of consumption to changes in the price at the pump.”
How it works: Gasoline demand plummeted when commuting went way down due to working from home and job losses, and while there’s been some revival, it’s still below pre-pandemic levels.
What’s next: “One thing that seems unlikely to ever bounce back fully is the amount of commuting,” she said.
“With many workplaces offering, or likely to offer, increased workplace flexibility, not only is gasoline demand likely to be lower, but it is also likely to be more elastic.”
Mercedes-Benz says it will follow its supply chains all the way back to the mines, if that is what it takes to ensure that the lithium and cobalt going into its rapidly expanding line of electric vehicles is produced with high environmental and human rights standards.
“Our aspiration is very clear – we want our products to contain only raw materials that have been mined and produced without human rights violations,” said Renata Jungo Brüngger, a board member of both Mercedes-Benz and Daimler AG, responsible for integrity and legal affairs.
“If there are any indications of risk, we take another, closer look at the supply chain. This involves us going beyond the direct suppliers and creating transparency – if necessary, all the way back to the mine,” Brüngger added.
President Donald Trump’s last-minute push to allow controversial drilling in part of Alaska’s Arctic will be an early target for the next administration, according to Senator Tom Udall, a contender to lead the Interior Department under Joe Biden.
The New Mexico Democrat was speaking of the Trump administration’s plan to pull off a sale of oil drilling leases in the Arctic National Wildlife Refuge before Biden, who wants to ban new drilling on all federal lands and waters as part of a strategy to fight climate change, becomes president on Jan. 20.
“I would expect that there would be real scrutiny and analysis of these last-minute kinds of deals that are being done,” Udall said in an interview, adding that he expects they could be overturned by the courts. “That’s an issue that needs to be looked at on Day One.”
The Interior Department, which manages federal and tribal lands, last week issued a request to energy companies to identify tracts in the refuge to be offered for sale. That puts the administration on a timeline that could bring a lease auction by mid-January, only days before Biden takes office.
If U.S. President-elect Joe Biden tries to restrict development of oil and gas drilling on federal lands, the American Petroleum Institute (API) will use “every tool at its disposal” including legal action, chief executive Mike Sommers said in an interview with Reuters on Monday. Biden has said he supports a ban on new gas and oil permits — including fracking — on federal lands.
Fracking, or hydraulic fracturing, is a drilling technology that has allowed the U.S. oil industry to vastly boost output in recent years, making the United States the world’s largest producer of crude oil. Environmental groups oppose fracking, saying it pollutes groundwater and exacerbates climate change.
Sommers said the API looks forward to working with the incoming Biden administration on energy but would “draw the line” if Biden implemented restrictions on lands that were “always meant for multi-use.”
“While Colorado’s natural gas and oil industry is nothing if not resilient, it is critical that we have a seat at the table as guidance is developed and the rules are put into practice.” -Lynn Granger, Executive Director, @API_Coloradohttps://t.co/U0KFCRkZwS
— American Petroleum Institute Colorado (@API_Colorado) November 23, 2020
On 10 November 1942, with Rommel’s army in full retreat across Egypt and French forces surrendering to the Americans and British in Morocco and Algeria, Winston Churchill gave a speech at Mansion House in London. “Now this is not the end. It is not even the beginning of the end,” he said. “But it is, perhaps, the end of the beginning.” That seems to be about where humanity is now in its battle against Covid-19.
So, while oil executives speaking at Wood Mackenzie’s online Americas Energy Summit this week were looking ahead to a better year in 2021, they were cautious about stepping up activity on hopes of a rebound in demand.
“We are taking a conservative approach to what we think prices will be,” said Vicki Hollub, chief executive of Occidental Petroleum. “I do believe that we’re going to see better prices towards the fourth quarter of next year… But for the near term, what we’re doing is we’ve capped our investment at $2.9 billion in 2021. That’s the maximum it would be, and if prices were for whatever reason to go lower than $40, we would probably adjust that.”
Rigzone’s downstream readers paid considerable attention to articles this past week focusing on signs of improving fortunes of players within the global crude oil and LNG markets. However, readers also showed interest in another recent piece detailing one place that appears to want less of an important energy commodity. Keep reading for details.
The Great American LNG Comeback
Like others in the U.S. oil and gas industry, LNG exporters have had to contend with low prices and low demand this year. However, as this article from Rigzone contributor Jude Clemente points out, the market for LNG from U.S. export terminals has been improving. In fact, he observes that demand has entered record territory in recent weeks. Although there has been an uptick in traditional Asian demand centers, Clemente also discusses how U.S. producers and shippers can make further inroads into the European market.
Publicly, the Alaska Department of Natural Resources says it’s not involved with Pebble Limited Partnership’s application for a federal permit to dig an open-pit gold mine upstream from Bristol Bay.
But text messages and meeting notes — released in response to a public records request from mine opponents — show that behind the scenes, the leaders of the agency have been collaborating with Pebble to create the final piece of Pebble’s application.
“This will be a huge lift, but I have full confidence in this team,” Deputy DNR Commissioner Sara Longan wrote in a text to another DNR official on July 31.
The federal government on Friday released a proposed rule aimed at limiting large banks from pulling their financing from Arctic oil and gas projects, after several banks announced policies that prohibit or limit their investment in such projects, including in the Arctic National Wildlife Refuge. However, some experts and activists said the rule’s impact, if it is finalized, could be muted if banks can show that opting to not finance Arctic oil projects is a financial decision, not a political one.
The head of the Office of the Comptroller of the Currency, an independent bureau under the Treasury Department, said on Friday that the banking system’s capital and services must be accessible to everyone on equal terms.
Our Take: From Alaska’s Congressional Delegation: U.S. Senators Lisa Murkowski and Dan Sullivan, and Congressman Don Young (all R-Alaska), welcomed a proposed rule announced today by the U.S. Office of the Comptroller of the Currency (OCC) to ensure that national banks are providing fair access to banking services to customers based on objective risk, without excluding legal businesses and individuals. The announced rule comes after a sustained effort by members of Congress, led by the Alaska congressional delegation, urging the country’s senior federal financial regulators to examine the legality of decisions in late 2019 and early 2020 by several of the nation’s largest banks to withhold financing from oil and gas development projects in the Arctic, including the 1002 Area of Alaska’s Arctic National Wildlife Refuge (ANWR).
Washington lawmakers may throw billions of taxpayer dollars at clean energy next year, prompting a rush of ideas about how to do it and how effective it can be at tackling climate change.
Driving the news: With the federal government’s political power likely divided, the biggest policies are likely to come through an economic recovery package in the form of subsidies and other spending.
Where it stands: Extending wind and solar tax credits are at the top of the list for Democrats and renewable-energy lobbyists. But more measures are in the works that could also hitch a ride on a stimulus bill.
The big picture: Washington has a decades-long practice of approving carrots (rewards) over sticks (penalties) to affect energy policy.
In fact, the federal government has almost never passed a major “sticks” policy — like carbon taxes and mandates penalizing oil, natural gas and coal — despite decades of debate about such approaches. (A federal ethanol mandate is a notable exception.)
What they’re saying: This debate about carrots and sticks is a perennial one.
TRUMP LOOKS TO BEAT THE CLOCK IN ALASKA: President Trump’s Interior Department this week will ask companies to pick which areas they’d like to drill for oil and gas in the Arctic National Wildlife Refuge, a hurried step toward an actual lease sale in January, not coincidentally, before Joe Biden takes office. A notice in the Federal Register today says Interior’s Bureau of Land Management will formally “request for nominations” tomorrow. BLM will hold a 30-day comment period once the call for nominations is published.
Need for speed: The Trump administration is eager to deliver on a mandate from the 2017 Republican tax cut bill allowing energy exploration in a 1.56 million-acre section of the 19.3 million-acre refuge, known as the “1002 area,” where billions of barrels of oil are believed to lie beneath the coastal plain.
“This call for nominations brings us one step closer to holding a historic first Coastal Plain lease sale, satisfying the directive of Congress in the 2017 Tax Cuts and Jobs Act and advancing this administration’s policy of energy independence,” said BLM Alaska state director Chad Padgett in a statement.
But Biden has vowed to permanently ban drilling in ANWR, declaring himself “totally opposed” to disturbing the status quo in a long off-limits area that environmentalists consider to be one of the wildest places left on Earth. The Trump administration is hoping that selling drilling rights before Biden comes in would make it difficult for him to reverse, since oil and gas leases on federal lands are considered government
After a record 2019, it has been a rocky ride through the pandemic for the U.S. LNG export business. Sunken prices and demand globally have shrunk our shipments abroad. In January, exports were up over 9 billion cubic feet per day (Bcf/d) before steadily falling to 2.5 Bcf/d at the end of August, with facility utilization bottoming out at 20 percent. From April to November, there were nearly 180 cargo cancelations, and RBN Energy estimates that a whopping 550 Bcf of gas was pushed back into the U.S. market in summer alone.
But U.S. LNG exports have been picking up in recent weeks, as the figure in this article shows. Asian prices have been rising quickly amid rebounding demand and forecasts of a frigid winter. Even through hurricane-related shut-ins in our shipment zone along the Gulf of Mexico, U.S. LNG demand has been at record levels of over 10 Bcf/d in recent weeks. All six of our facilities have been online.
Drilling crews are returning to the Niblack Project, a mineral exploration effort seeking copper, gold, silver, and zinc near Prince of Wales Island’s Moira Sound. The project ramped up in 2009. In the years to follow, the company Heatherdale Resources says it plowed tens of millions of dollars into exploration efforts. But investor money dried up and by 2012 full-time exploration had ceased. Work completely stopped by 2016.
Now, after a corporate reshuffling of debt and rising copper and gold prices, the company plans to bring back a two-dozen-strong crew by the end of this month. Heatherdale’s CEO Rob McLeod says the drilling will likely go no deeper than 1,000 feet.
“Most will be shallower than that,” he said. “And then we’ll be able to take the drill underground and be able to drill in in multiple directions 360 degrees, essentially.”
Exxon Mobil Corp. is calling on a federal court to dismiss a lawsuit from Connecticut officials accusing the oil giant of misleading the public about the role of fossil fuels in driving climate change.
Connecticut lacks personal jurisdiction over Exxon because the challenged actions—producing, promoting, and selling oil and gas—took place outside the state and were conducted by nonresidents, the oil giant told the U.S. District Court for the District of Connecticut on Nov. 13.
Amid predictions of a November Democratic election sweep, climate leaders in states including North Carolina, Arizona and Pennsylvania were hopeful they could finally pass legislation to bolster clean energy, cut emissions and limit fossil fuel development. But while President-elect Joe Biden found success at the top of the ticket, Democrats down ballot were unable to flip a single legislative chamber held by Republicans. Meanwhile, the GOP seized power in New Hampshire’s legislature and expanded majorities in other states. After Democratic gains failed to materialize, the prospects of sweeping climate action — at least at the state level — have dimmed. The only exceptions are states where Democrats won more seats in already blue legislatures, including California, Connecticut, New Mexico, and Washington.
The Trump administration will take key steps to finalize a sale of oil drilling leases in the sensitive Arctic National Wildlife Refuge just before Joe Biden becomes president. https://t.co/6smkyclKsOpic.twitter.com/PkXmbspJfz
It has been said that “if you don’t grow it, you have to mine it.” Simply put, the materials we don’t grow we have to extract from Earth.
It is why we need a strong U.S. mining industry. The materials we need to construct things like roads and dams, or manufacture things like satellites and telephones, could be secured at home if we invest in our domestic mineral supply chain.
American mining companies can do it better than anyone else, but currently we rely on foreign nations like China for critical minerals. It is with this reality in mind that we are asking our followers to stand up and submit a letter of support for a pending mining project in central Idaho: The Stibnite Gold Project.
Take a small but significant step to help support America’s mining industry. Tell regulators to move the Stibnite Gold Project forward.
#Miners are facing greater pressure than ever to cut emissions. Achieving an #energytransition that limits the rise in global temperatures to below 2 degrees requires huge policy shifts – and could also drive change in company portfolios https://t.co/lGiSdrd7Xh
President Donald Trump is a fierce backer of the fossil fuels industry. And that support is paying off big time in the money race.
Trump is crushing Joe Biden in campaign donations from the embattled oil-and-gas industry. The president and outside groups aligned with him have raised nearly $13 million from individuals at oil-and-gas companies, according to OpenSecrets, a research group that tracks money in politics. That easily dwarfs the $976,000 the industry has sent to Biden.
It’s not shocking that the oil-and-gas industry is firmly in Trump’s camp. Not only do oil-dominant states like Texas, Oklahoma and North Dakota reliably vote Republican, but Trump has touted an agenda of American energy dominance marked by cutting environmental regulations and pushing energy exports.
During a town hall meeting Thursday, Democratic presidential nominee Joe Biden again assured shale producers that he wouldn’t ban fracking if elected. Then, in virtually the same breath, he touted his $2 trillion clean-energy plan, which aims to edge natural gas out of the power mix within 15 years.
The former vice president’s efforts to walk a tightrope on gas reflect the fossil fuel’s precarious place in the economy. For now, it’s an essential part of American life. Biden has been careful not to make an enemy of the industry, especially in the key battleground state of Pennsylvania, home to the largest U.S. shale-gas field. His policies may even, in the short-term, support the gas market.
But in the long run, the fuel may prove economically and environmentally untenable within the power sector, a key market for producers. Biden’s climate plan would only accelerate that outcome, with massive investments in wind, solar and battery storage giving those energy sources a leg up. And his goal of a carbon-neutral grid would severely curb, if not destroy, gas’s share of the pie in favor of cheaper, cleaner renewables.
“Decarbonization isn’t a debate — it’s a fossil-fuel death sentence,” said Kevin Book, managing director of ClearView Energy Partners. “It means a resource is going off the grid. That is the inevitable implication.”
Alaska Senator Lisa Murkowski, a long-time skeptic of the proposed Pebble mine project, is now pledging to take further congressional action, including the use of the federal appropriations process, to protect the ecologically sensitive Bristol Bay region. Speaking virtually at the Alaska Federation of Natives (AFN) annual convention last week, Murkowski, who serves as chairwoman of both the Senate Interior-Environment Appropriations Subcommittee and the Energy and Natural Resources Committee, said she would use spending legislation to protect Bristol Bay, which is home to the world’s biggest salmon run and one of its largest commercial fisheries.
Well that, as Ron Burgundy would say, escalated quickly. China’s foreign ministry is accusing the Trump administration of “major retrogression” on climate and being an environmental “troublemaker.”
Why it matters: China’s unusual statement Monday widens the rupture between the world’s largest carbon emitters as global climate efforts are flagging and the pandemic’s effect on emissions is too small to be consequential in the long term.
Our thought bubble, via Axios’ Bethany Allen-Ebrahimian: This is a pretty smart line of attack for Beijing, which seems to have determined that a world increasingly wary of China would still welcome its climate leadership, particularly given the U.S. abandonment of this issue under President Trump.
A Russian court sentences the former mayor of Norilsk to community service over a massive Arctic fuel spill.
