Oil from Canada w/o pipeline. Coal hits $100. GOP raises $43m in Q1.

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Today’s Key Takeaway’s – DOI Secretary Deb Halland will be in Alaska next week- all about King Cove Road. Biden wants more oil from Canada but no new pipeline to transport it. Energy Information Administration study: restricting interstate U.S. natural gas pipeline capacity only slightly lowers energy-related carbon dioxide (CO2) emissions. For the first time in 13 years, coal tops $100.


Interior Secretary Haaland to visit Alaska this month
Associated Press, April 5, 2022

Interior Secretary Deb Haaland plans to visit Alaska this month, a trip that is expected to include a visit to community at the heart of a long-running dispute over a proposed land exchange aimed at building a road through a national wildlife refuge.

Haaland had planned to visit King Cove last year, but the trip never materialized.

The Interior Department on Monday said Haaland planned to visit “several communities and sites” in Alaska the week of April 17, including Anchorage, Fairbanks, and King Cove.

Residents of King Cove have long sought a land connection through Izembek National Wildlife Refuge to Cold Bay, which is about 18 miles (29 kilometers) away and has an all-weather airport. They call it a safety issue.

The refuge, near the tip of the Alaska Peninsula, contains internationally recognized habitat for migrating waterfowl.

In 2013, Interior Department officials declined a land exchange, and efforts to move forward with one under the Trump administration faced legal challenges. A U.S. Justice Department attorney, in arguing a position taken under the Trump administration, last year told a federal appeals court panel that Haaland planned to review the record and visit King Cove before taking a position herself on the issue.

Interior Department spokesperson Tyler Cherry did not respond to questions about whether she was still weighing a decision. He said by email that he had no further details to share about the trip beyond those in the announcement sent Monday.

A federal appeals court panel last month reversed a decision that rejected a land swap and sent the decision back to a federal judge in Alaska for further consideration. Conservation groups had sued over the proposed swap.


U.S. Wants More Oil From Canada but Not a New Pipeline to Bring It
Timothy Puko, The Wall Street Journal, April 5, 2022

White House still opposes Keystone, but other options could include shipping more oil by rail or expanding pipeline capacity along existing routes

Biden administration officials are seeking ways to boost oil imports from Canada, people familiar with the situation say, but with one big caveat—they don’t want to resurrect the Keystone XL pipeline that President Biden effectively killed on his first day in office.

The people said deliberations are in early stages and that no clear-cut solutions have emerged.

Canada could export some more oil via rail, according to analysts and others familiar with the situation, and it could also pump more oil by increasing pressure on existing lines or by installing larger pipelines along permitted routes.

Those options, however, offer limited potential because rail transport is expensive and existing pipelines are at or near capacity.

Longer term, Canadian officials and oil-industry analysts say expanding the existing Keystone pipeline network would offer a bigger, more efficient solution. The XL expansion was to carry 830,000 barrels a day of Canadian crude from Alberta to Nebraska, where the pipeline would meet up with the existing Keystone pipeline, and then on to refineries on the U.S. Gulf Coast.

Canada has ample reserves under its soil to meet U.S. demand, said Kevin Birn, an analyst with S&P Global Commodity Insights. It just doesn’t have enough pipeline capacity to pump it here, he said.

“There’s not a limitation in terms of resource potential,” Mr. Birn said. “There’s a limitation of capacity.”

With gasoline prices at near-record levels, President Biden last week ordered 180 million barrels of crude oil to be taken from the nation’s emergency reserves to increase supplies.

At the same time, White House officials say Mr. Biden has no interest in reviving the Keystone XL pipeline project. They say that it couldn’t be completed in time to address today’s shortfall and that the president is still committed to reducing greenhouse gas emissions from fossil fuels over the long term.

“While the U.S. continues to engage with a variety of producing countries to address the current supply imbalance we are seeing, the Keystone XL pipeline would have done little to nothing in addressing that supply,” a White House spokesman said.

That leaves limited options for bringing more Canadian crude to the U.S.

Enbridge Inc.’s Mainline system, for example, carries 2.85 million barrels of Canadian crude oil daily from Alberta to the Midwest, making it Canada’s largest network of pipelines. Company officials say it is running at full capacity.

Canada’s federal government is building an expansion for its Trans Mountain pipeline from Alberta, which will enable an extra 590,000 barrels a day to reach Canada’s West Coast, and from there by ship to refineries in the U.S. and Asia. That expansion won’t be completed until the end of 2023, however.

Canadian oil producers could also send another 200,000 barrels a day of crude by rail. That amount is a fraction of the average 4.3 million barrels a day the country exported to the U.S. last year, according to the U.S. Energy Information Administration. Transport by rail is also expensive, which would squeeze Canadian producers’ profits.

Jason Kenney, premier of the Canadian province of Alberta, where most of Canada’s oil lies, is pushing for reviving the Keystone plans. He has criticized the Biden administration for looking to repressive regimes such as Venezuela and Saudi Arabia for oil when Canada can provide additional capacity.

“We’re pleased to hear that there are discussions around enhancing North American energy security,” said Mr. Kenney’s spokesman, Justin Brattinga. “Instead of going cap in hand to the Saudis, Iranians and Venezuelans to replace Russian energy, instead of replacing dictator oil with dictator oil, come to your liberal democratic friends and allies in Canada.”

Alberta has also been reaching out to U.S. lawmakers in states and in Congress.

Mr. Kenney spoke with Sen. Joe Manchin (D., W.Va.) last month to discuss continental energy security, said Sonya Savage, Alberta’s energy minister. Mr. Manchin asked Mr. Biden last year to reconsider his decision to scrap the Keystone XL project.

Mr. Manchin, who chairs the Senate Committee on Energy and Natural Resources, might soon visit the Alberta oil sands, said Ms. Savage.

Mr. Manchin’s office declined to comment.

Sen. Bill Cassidy (R., La.), a vocal advocate for the Keystone XL project and Gulf Coast refiners, said the White House has ruled out the pipeline because it doesn’t want to anger Mr. Biden’s political supporters.

“The president’s rhetoric does not match his actions,” he said. “The Biden administration refuses to take steps that would lower gas prices and address the struggles facing American families, because they are afraid of backlash from their base.”

In response, the White House said that implementing Mr. Biden’s plans to promote use of electric vehicles would save Americans more than $900 a year in gasoline costs, and that his plans to use clean energy to power utilities would tack on an additional $500 a year in savings to consumers and “create millions of good-paying union jobs.”

Mr. Biden took on Keystone XL as a signature issue under heavy pressure from environmentalist supporters. They had made it a symbol of their effort to limit global warming by reducing oil consumption.

Pipeline developer TC Energy Corp., which had hoped to complete the pipeline in 2023, abandoned plans a few months later.

When Mr. Biden took office, international crude prices were less than $60 a barrel and regular gasoline prices averaged less than $2.40 a gallon in the U.S.

Since then, oil has nearly doubled, with the international benchmark settling Monday up 3% to $107.53 a barrel. Pump prices have soared to record highs, with regular unleaded averaging a nominal record of $4.22 a gallon in March, according to the EIA, helping drive inflation to a 40-year high.

As gas prices have risen, the White House has softened its stance on fossil fuels. U.S. Energy Secretary Jennifer Granholm met with Canada Natural Resources Minister Jonathan Wilkinson at an industry conference in Houston last month.

They discussed global-energy security in the wake of the Ukraine conflict and their initiatives to address climate change, said a spokesman for Mr. Wilkinson.

Canada has drawn interest from many countries looking to replace Russian energy, food, and mineral exports. It has the fourth-largest oil reserves in the world.

Last month Mr. Wilkinson said Canadian oil and natural gas producers could raise production by 300,000 barrels a day, adding to supplies that have hit record levels in recent months.

Ms. Savage, Alberta’s energy minister, said that Canada could produce even more, but only if her country’s federal government changed policies that have emphasized greenhouse-gas reductions and reducing reliance on fossil fuels.

The Canadian industry’s ability and willingness to invest the money needed to produce and move more oil depends on how much assurance it can get that policy makers will support the projects, said Tim McMillan, chief executive of the Canadian Association of Petroleum Producers, an energy industry group.

Despite the recent talk, the evidence so far hasn’t been in favor of more investment, he said.

“So far, the clearest signal from the U.S. is that they canceled Keystone,” he said.


U.S. EIA Explores Effects Of Not Building Future Interstate Natural Gas Pipelines
Energy Information Administration, April 5, 2022

In our Annual Energy Outlook 2022 (AEO2022), Issues in Focus: Exploration of the No Interstate Natural Gas Pipeline Builds, we analyze the effects on the energy market if no additional U.S. natural gas pipeline capacity is built between 2024 and 2050. In the No Interstate Natural Gas Pipeline Builds case, we project 5% less natural gas production and 4% less natural gas consumption in 2050 compared with the Reference case. We also project that the Henry Hub spot price in 2050 would be 11% higher in that case than in the Reference case.

Restricting U.S. interstate pipeline builds in our projection results in 7.4 billion cubic feet per day (Bcf/d) less interregional capacity in 2050 than in the Reference case projection, which, for example, limits the amount of natural gas that can flow from the Appalachia production region to demand areas such as the Midwest.

The higher natural gas prices that result from capacity constraints primarily affect natural gas consumption in the U.S. electric power sector, which is more price-sensitive than the residential, commercial, and industrial sectors. In the No Interstate Natural Gas Pipeline Builds case, we project 11% less natural gas-fired generation in the United States during 2050 than in the Reference case. Higher natural gas prices make natural gas less economical for electric power generation compared with alternative sources, such as coal or renewables.

We project that natural gas’s share of U.S. electricity generation would fall from 34% in 2050 in the Reference Case to 31% in the No Interstate Natural Gas Pipeline Builds case. To make up for less natural gas-fired generation in the No Interstate Natural Gas Pipeline Builds case, electricity generation from renewables, coal, and nuclear sources increase.

We project that restricting interstate U.S. natural gas pipeline capacity would only slightly lower energy-related carbon dioxide (CO2) emissions in the United States relative to the Reference case. Total CO2 from all fuel sources in 2050 are 4% lower in the No Interstate Natural Gas Pipeline Builds case than in the Reference case. The relatively small effect on CO2 emissions, despite the decline in natural gas consumption and growth in electric power generation from renewable sources, is due to our forecast of increased coal-fired power generation, which would be more carbon intensive than the natural gas-fired generation it displaces.


US coal prices top $100/t for first time since 2008
Bloomberg News, April 4, 2022

U.S. coal prices topped $100 a ton for the first time in 13 years as Russia’s war in Ukraine upends international energy markets and an economic rebound from the pandemic drives up demand for fossil fuels.

Prices for coal from Central Appalachia surged 9% to $106.15 a ton last week, the highest since late 2008, according to government data released Monday. Prices in the Illinois Basin rose to $109.55, topping $100 for the first time in records dating to 2005.

The surge matches increases around the world as the Ukraine war prompts users to seek alternatives to Russian coal, which accounted for almost 18% of global exports in 2020. That’s exacerbating a surge in demand that began last year as a global economic recovery from pandemic drove up electricity consumption. 

“The energy fallout from Russia’s invasion of Ukraine could last for a while,” Michelle Bloodworth, chief executive officer of America’s Power, a coal-power trade group, said in an interview. “Coal is going to be needed for the foreseeable future.”

While U.S. power producers have been shifting away from coal, consumption actually climbed last year as prices also increased for natural gas. More costly fossil fuels come as U.S. consumers already face the highest inflation in four decades. Americans are paying higher utility bills, food prices are surging and housing costs are up.

Prices in Central Appalachia and the Illinois basin are rising more than in other U.S. coal-producing regions because they have easier access to international markets. U.S. exports climbed 23% last year and are expected to increase another 3.3% this year as miners take advantage of record international prices.

The rebound in coal comes as a United Nations-backed panel of climate scientists warned Monday that the world may be on track to warm at a pace that would painfully remake societies and life on the planet.


First look: Senate GOP campaign arm raises $43 million in Q1
Alayna Treene, Axios, April 5, 2022

The Senate Republicans’ campaign arm raised $43 million during the first quarter of 2022, breaking its fundraising records as it gears up for an aggressive midterm cycle, Axios has learned.

Why it matters: The influx comes as the group targets Sens. Mark Kelly (D-Ariz.), Maggie Hassan (D-N.H.), Catherine Cortez Masto (D-Nev.), Raphael Warnock (D-Ga.) and Michael Bennet (D-Colo.) in its efforts to take back the Senate majority come November.

  • The quarterly total brings the National Republican Senatorial Committee’s overall cash on hand to $44.1 million — the highest in its history.
  • It’s also the most the NRSC has raised during any previous March or first quarter, the committee told Axios.

Driving the news: Sen. Rick Scott (R-Fla.), chairman of the NRSC, presented the numbers to the Senate Republican conference on Tuesday during its weekly closed-door lunch.

  • What they’re saying: “Senate Republicans have the war chest and the enthusiasm to oust radical Senate Democrats in November. Our team breaks records every month and that’s because the American people are sick and tired of the failed policies pushed by Joe Biden and rubber-stamped by Democrats.”
  • The Democratic Senatorial Campaign Committee has not yet released its Q1 or March fundraising numbers.

By the numbers, according to the NRSC:

  • Total raised during Q1 of 2022: $43 million
  • Total raised during March: $13.28 million
  • Cash on hand: $44.1 million
  • Number of March donations: 96,933
  • Number of March first-time donors: 16,041
  • Number of March donations under $200: 203,064
  • Debt: $0