Today’s Key Takeaways: Pebble victim of rare veto. Oil prices have found a floor? FERC speeds up 3 natural gas proposals. “Every single metal on periodic table is extremely bullish.”
NEWS OF THE DAY:
Feds use rare veto to block Alaska copper, gold mine plan
Becky Bohrer, AP, January 31, 2023
The U.S. Environmental Protection Agency on Tuesday effectively vetoed a proposed copper and gold mine in a remote region of southwest Alaska that is coveted by mining interests but that also supports the world’s largest sockeye salmon fishery.
The move by the agency, heralded by Alaska Native tribes and environmentalists who have long pushed for it, deals a potentially devastating blow to the proposed Pebble Mine and comes while an earlier rejection of a key federal permit for the project remains unresolved.
Pebble Limited Partnership CEO John Shively in a statement called the EPA’s action “unlawful” and political and said litigation was likely. Shively has cast the project as key to the Biden administration’s push to reach green energy goals and make the U.S. less dependent on foreign nations for such minerals.
The Pebble Limited Partnership, the developer behind Pebble Mine, is owned Canada-based Northern Dynasty Minerals Ltd.
OIL:
RBC: Oil Prices Will Only Go Higher From Here
Charles Kennedy, OilPrice.Com, January 31, 2023
Crude oil prices have found a floor and the only way they can go from here would be higher. That’s according to RBC commodity analysts Helima Croft and Michael Tran, as quoted by Bloomberg.
“We remain constructive on the fundamental framework, and in fact, we would not be the least bit surprised if the lows of the year end up being the US$72/bbl (per barrel) print that we saw three weeks ago on the second trading day of the year,” they said, adding that China’s reopening had not yet been fully priced in to the oil market.
This might sound a bit surprising given that China’s reopening is being cited as the biggest reason behind oil prices’ recent climb upwards and as the biggest tailwind for them going forward.
Yet with reports coming in about still high infection rates in the world’s largest importer of crude oil, it may well be the case that China’s reopening has not yet been priced in to the oil market.
“We don’t think that there’s much that’s being priced into the oil market as a function of China’s reopening yet and the reason why is because the consumer path towards normalization is still going to be quite bumpy,” Michael Tran told Bloomberg in an interview.
This path to normalization will likely be marked by an increase in imports, which are still about 1.5 to 1.7 million bpd below where they were pre-pandemic, according to Tran.
Not all of these volumes need to return for oil prices to spike, the analyst noted, however. “The key idea here is we don’t need to get all of that back for the market to rally significantly. If you start picking up a quarter million, half million, [or] one million barrels a day over the course of the next several months, you better bet that this is going to be an oil market that moves higher,” Tran told Bloomberg.
GAS:
FERC speeds up environmental reviews for 3 gas projects
Miranda Wilson, Energywire, January 30, 2023
The Federal Energy Regulatory Commission plans to conduct environmental assessments in the coming months for proposals in Alabama, Texas and Pennsylvania.
Three natural gas proposals pending before the Federal Energy Regulatory Commission will be subject to a shorter environmental review process under acting Chair Willie Phillips, the agency said last week.
FERC will conduct environmental assessments in the coming months for gas pipeline projects proposed in Alabama, Texas and Pennsylvania, according to a series of public notices.
Under former Chair Richard Glick, who left the agency early this year, FERC staff had been scheduled to conduct environmental impact statements, which involve a longer and more detailed review process.
The projects in question are Texas Eastern Transmission LP’s Appalachia to Market II and Entriken HP Replacement Project as well as Transcontinental Gas Pipe Line Co. LLC’s Southeast Energy Connector Project and Texas to Louisiana Energy Pathway Project.
The projects are largely aimed at expanding the flow of gas through existing pipeline systems. Project sponsors and shippers have described the developments as necessary for ensuring reliable access to gas.
In the case of the Southeast Energy Connector Project, Transcontinental has said the pipeline would enable a power plant in Alabama to switch from burning coal to natural gas.
Also last week, FERC said it would prepare a supplemental environmental assessment for a liquefied natural gas expansion project on the Gulf Coast of Texas.
The environmental assessment for the Port Arthur LNG Expansion Project, which is being developed by Port Arthur LNG LLC, will focus on “impacts on air quality, environmental justice communities, and climate change,” according to a notice from the agency.
The project, which would increase the amount of natural gas exported from an existing terminal, has been opposed by local environmental advocates and community groups in the region.
In a comment sent to FERC in 2021, the Port Arthur Community Action Network said it had “deep concerns that FERC has not taken a hard enough or appropriate look” at the expansion proposal, particularly regarding visual impacts, air pollution and other concerns.
FERC did not say in the notices what prompted the change in environmental reviews.
But the shift comes as Republican lawmakers and the natural gas industry have complained that environmental impact statements at the agency had taken too long under Glick. Both Glick and Phillips are Democrats.
Phillips has expressed interest in ensuring that FERC’s decisions promote environmental justice, the notion that all communities deserve access to a clean and healthy environment. Earlier this month, he announced that FERC would hold a roundtable discussion in March on environmental justice and equity.
Another priority of his is to ensure a reliable, secure energy system, the acting FERC chair has said.
“Reliability remains job number one,” Phillips said during a commission meeting this month.
MINING:
Are metals headed for a golden age?
Nelson Bennett, Mining.Com, January 31, 20232
Gold prices could break an all-time high in 2023 and the outlook for “every single metal on the periodic table” is incredibly bullish, which could be very good for the junior exploration sector.
Those were some of the prognostications Monday at the Vancouver Resource Investment Conference, which followed on the heels of last week’s Association of Mineral Exploration (AME) Roundup conference, attended by close to 6,000 people from around the world.
POLITICS:
| EPA Decision Preemptively Blocking Pebble Mine Illustrates the Serious Obstacles For Mining in the U.S. |
| WASHINGTON, D.C. – The National Mining Association (NMA) issued the following statement on the U.S. Environmental Protection Agency (EPA) decision to prohibit mining at the proposed Pebble Mine and future proposals in the area, blocking any development actions across more than 300 square miles of Alaska land. “Given skyrocketing minerals demands and the fragility of our global supply chains, domestic mining has never been more important. But today’s announcement from EPA is in stark contrast to national and global realities. “The Biden-Harris administration’s electrification and energy priorities – all of which rely on access to considerable minerals and metals, including those the Pebble project would develop – cannot possibly be realized responsibly if U.S. government authorities continue on this adversarial path with domestic mining projects. With our technological and energy future on the line, these minerals and metals will come from somewhere. The question for government authorities and environmental groups is this: will we source them here at home, creating jobs through projects that will be held to the world’s highest environmental, labor and safety standards, or will they be sourced from geopolitical rivals and countries that rely on child labor and unsafe work conditions? Allowing the preemptive veto of any development project before the review process is completed would suggest the answer is the latter. We note as well that the comprehensive environmental impact statement completed by the Corps of Engineers indicated that the mine would have no population level impact on the Bristol Bay fishery. “This end-run of the proper permitting process creates significant regulatory uncertainty for the mining industry during a crisis point for minerals demand.” |