Some Good News: Investors Balk over ANWR Drilling

 

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“You know what would be nice here? Derricks.” – Not Everyone, thankfully

Ye gods, but this blog has been bleak of late. Let’s look at some good news, and it comes from one of this blog’s favorite group of people…the investor class!

 

No, but for real. From The Guardian

Investors managing more than $2.5tn have warned oil firms and banks to shun moves by the US president, Donald Trump, to open the Arctic national wildlife refuge (ANWR) to drilling.

Companies extracting oil and gas from the wilderness area in Alaska would face “enormous reputational risk and public backlash”, the investors say in a letter sent on Monday to 100 fossil fuel companies and the banks that finance them.

Exploiting the area would also be an “irresponsible business decision”, the group argues, as global action on climate change will reduce oil demand and mean such projects have a high risk of losing money. An accompanying letter from the indigenous Gwich’in people say it would be “deeply unethical” to destroy their homelands.

This, to me, is really good. It would be nice if we could just say “Don’t do it, because it’s stupid and it ruins everything that is nice and beautiful in the world and we’re already tipping irrevocably into civilizational ruin because we’re pulling all the carbon from the ground and pushing it into the sky and the ocean and can we just stop that and enjoy some moose for goddamn once?

But that’s not really going to work, and so the language used here is perfect. It of course talks about the rights of the indigenous, which is really heartening after the horrors of DAPL and, say, the last half-millennium-and-change of human history. But it is most powerful, at least for its intended audience, when it uses the language of business.

An “irresponsible business decision” is exactly right. The investors are saying that we’re going to move away from fossil fuels, so this is an enormous investment of capital for an uncertain payoff. I’m not sure that, in a vacuum, they are correct. That battle isn’t won. But when the battle is joined by people who stand to make money from fossil fuels, on the side of clean of energy, that tilts the odds. It’s a (hopefully) self-fulfilling prophecy.

I’m not sure I agree that the companies would face “enormous reputational risk and backlash” overall. As a nation, we tend to be pretty blase about companies poisoning the land and water; it’s not as if there are public marches against Enbridge.  But if there is backlash from the large investment groups and pension funds that modern capitalism depends on? Well, that’s a different story.

Finally, I really liked this:

“There is no longer any doubt that climate change poses an acute risk not only to our collective way of life, but also to investments made in outdated and highly precarious forms of energy,” said Thibaud Clisson at BNP Paribas Asset Management, another signatory.

I like that there is almost a sigh, here. “Yes, it may kill us all, but if that’s not enough to get through your greedy, short-sighted heads, it might also cost you money. Christ.”

BNP Paribas has about $682 billion in asset management. This is how capitalism works when it works for good. People make rational, long-term decisions that don’t just look at the quickest and dirtiest dollar, but figure out a way to make sustainable money.

That can be greed. That can be nothing but pure self-interest. That can be not really giving a damn about the Gwich’in people, except as another way to dissuade a company not to make a bad bet.

Is it an ideal system? Probably not. Will it always work? Certainly not. Is it a better way of doing things, and on the path toward something actually sustainable? It seems to be the only way, and maybe the best chance we have at saving ourselves from ourselves.

So today’s rare burst of good news is that capitalism can potentially work when capitalists realize that the destruction of human civilization is bad for the bottom line. Baby steps are better than sprinting backwards.

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A Gentle Sugesstion to Trump’s “Oil and Gas Allies” Who Are Worried About Too Much Deregulation

 

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“But no one told us explicitly not to do this!” 

 

Politico offers us another example of “terrible people who are stunned by how bad Trump really is” (we can also call this “The Mitchie”).

Publicly, petroleum companies and their trade groups are cheering Trump’s efforts to undo former President Barack Obama’s environmental regulations, including restrictions on fracking-related pollution, pipeline permits and offshore drilling. But quietly, people in the industry are growing worried that deregulation could backfire on them, according to interviews with a dozen executives, lobbyists, lawyers and analysts.

Among their fears: Laxer rules could set the stage for an environmental disaster like 2010’s BP oil spill in the Gulf, which blackened the industry’s reputation and spurred a regulatory clampdown.

“Every industry wants regulations that make sense, but you don’t need to roll things back so far that it opens an opportunity for outsiders to criticize, or something bad happens,” said Brian Youngberg, an energy analyst at the investment firm Edward Jones.

A person at one oil and gas company expressed similar worries. “It’s not helpful if regulations are streamlined so as to allow something to happen — say, a methane explosion or a spill — and we’d be painted with it as an entire industry,” said the person, who requested anonymity to speak freely.

Now, far be it from me to tell titans of industry what to do, but if you are worried about public reaction to you destroying the air and water, if not actually worried about destroying the air and water, maybe you could do more than the absolute minimum required of you by a government bound and determined to make every single corner the end of Wigan Pier?

But, I guess by untying their hands, Trump is truly binding them to their fate. What are you supposed to do, you know? Be marginally less profitable? And so it goes.

Trump’s Pipeline Policies: As Bad As Everything Else They Do

APTOPIX Michigan River Oil Spill

The aftermath of the Enbridge oil spill in Michigan. Image from salmonguy.org

How many pipeline spills do you think there were last year? Three? Ten? 85? Maybe you remember reading about a few, and think, well, things were pretty hectic last year, what with the dying-fish floparound of liberal democracy, so maybe I missed one here or there.

There were, at least, 220 “significant” leaks220 “significant” leaks, when you count oil (in all its manifest and increasingly sludgy forms), natural gas, and refined gasoline. Because that’s what pipelines do. They burst. Whether they are lurking under the Great Lakes or right at the edge of your town, coursing under the fields where you ran as a child, they are a time bomb, ready to go off.

Of course, we need pipelines. Our economy is still based on dead dinosaurs (which, though not strictly accurate, sort of is, and is actually sort of cool, when you think about it), and that matter needs to be transported. It’s a devil’s deal, maybe, but it’s the one we have. Which is why you think it would be super really important to make sure that those pipelines, which are aging, increasingly prone to busting, and more susceptible to extreme weather (which we’re having more of), are monitored, protected, and upgraded.

Now, the upgrading might be part of the administration’s infrastructure plan, though it seems like they are already planning to “punt” that to 2018, partly because they have other priorities (taking away health care from millions, tax cuts for the wealthy), and mostly because Republicans really don’t want to spend any money on infrastructure, as Yglesias reminds us. So let’s not put our eggs in the upgrade basket.

And, of course, the “monitor and regulate our aging pipelines so as to not poison our air, water, and land” is DOA as well. They are looking to “ease” regulations that the Obama administration imposed that call for strict monitoring.

Regulators in the waning hours of the Obama era wrote rules aimed at changing that, and the industry is looking forward to the new administration rolling them back. The Pipeline and Hazardous Materials Safety Administration “has gone overboard,” said Brigham McCown, a former head of the PHMSA who served on President Donald Trump’s infrastructure transition team. “They built a Cadillac instead of the Chevrolet that Congress told them to build.”

While Obama was president, the PHMSA (Pipeline and Hazardous Materials Safety Administration)budget grew by 61 percent. Then, seven days before Trump’s inauguration, the agency finalized a rule toughening up inspection and repair demands, mandating, for example, that companies have leak-detection systems in populated areas and requiring they examine lines within 72 hours of flooding or another so-called extreme weather event. The American Petroleum Institute, the oil and gas industry’s main trade group, characterized it all as overreaching and unnecessary.

Unsurprisingly (though inconclusively, as it was a small sample size) the total number of spills and leaks actually dropped last year, from 462 in 2015 to 417 (the 220 number above was “significant” leaks, obviously a few hundred are no biggie). So yeah, the new energy team thinks that having the Cadillac of pipelines protection is way worse than having the Chevy.

So let’s sum up.

  • No money for upgrades
  • Fewer regulations
  • Less monitoring
  • No admittance that old pipelines are in more danger due to climate change, because what’s that?
  • More reliance on the materials that lead to climate change
  • More pipelines (even if you have to ignore reasonable arguments against)

It’s a maddening and lunatic philosophy. It’s one thing to want to rely entirely on fossil fuels; it is another altogether to deliberately oppose making the usage of them even slightly safer. I don’t even know if you can call that a philosophy. It’s just insanity, and it is the insanity that is running our country.

Anyway, this was another reminder that Donald Trump is a right-wing Republican who governs like a right-wing Republican.