At the same time, President Trump’s team is hurrying to ensure Wall Street keeps money flowing toward arduous efforts to drill in that chilly corner of northeast Alaska.
Caught in the middle of the hot Arctic fight are big banks, insurers and even oil drillers themselves as the Trump administration prepares to sell drilling rights in the Arctic refuge.
The fight is on as the Trump administration took another step last week toward selling off drilling rights in the refuge before the end of the president’s term.
The latest salvo is a new Trump administration regulation aiming at blocking banks from restricting financing for Arctic drilling.
Under a rule proposed Friday by the Office of the Comptroller of the Currency, big banks would not be allowed to refuse lending to entire business categories that don’t break the law.
Five banking behemoths — Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley and Wells Fargo — have said they will restrict lending to Arctic drilling projects after facing pressure from green groups and activist investors.
The administration’s proposal came after complaints from both the fossil-fuel sector and Alaska’s all-Republican congressional delegation that banks weren’t willing to finance the projects. It was issued to ensure “fair access to financial services, credit, and capital [that] are essential to our economy,” according to acting Comptroller of the Currency Brian P. Brooks.
“For too long, we have seen financial institutions making policy decisions in attempts to de-bank disfavored industries,” Rep. Don Young, Sens. Lisa Murkowski and Dan Sullivan of Alaska said in a statement Friday.
Graham Steele, director of the Corporations and Society Initiative at Stanford Graduate School of Business, said banks are thinking twice about such lending because many of them are inherently financially risky as a result of the volatility of oil prices and difficulty of getting pipelines approved, among other factors.
The proposed rule, said Steele, formerly a Democratic staffer on the Senate Banking Committee, “starts from the premise that they are doing this solely for political reasons… when there are a whole bunch of economic factors.”
Environmentalists, meanwhile, have been turning up the heat on corporations to oppose drilling in the Arctic animal habitat.
In the past week alone, a coalition of Native Alaskans, activist investors and green groups asked AIG, Allianz and other insurance companies to stop supporting any oil and gas projects in the refuge, while Trillium Asset Management filed a shareholder resolution with Bank of America demanding it explain why it hasn’t joined other Wall Street banks in refusing to finance Arctic drilling.
Both moves are designed to plug the flow of financial support to working in the refuge, even as the Trump administration moves forward with plans for an auction of drilling rights or leases.
Many oil companies have tried keep their heads down on the hot-button issue — by either saying flatly they will not place bids or by not disclosing whether they plan to do so. One exception is Chevron, which told the Bureau of Land Management in March that it thinks “industry can safely develop” inside the wildlife refuge.
“Fossil fuel giants like Shell and BP have bowed to public pressure and will not purchase leases — but Chevron clings steadfastly to hopes of plundering this publicly owned land for financial gain,” reads a recent petition to Chevron from the Natural Resources Defense Council.
The Trump administration is hurrying to auction off Arctic drilling rights before Biden can block them.
The Interior Department asked oil companies last week to identify spots in the nearly 1.6 million-acre coastal plain where they want to lease. Congressional Republicans gave the green light to drilling in the once-protected refuge as part of the 2017 tax bill.
Trump officials, however, have until Biden takes office on Jan. 20 to sell the leases. The former vice president has promised to block drilling in the refuge. Doing so, though, becomes much harder once the leases are issued.
The OCC’s proposed rule, meanwhile, is up for public comment until Jan. 4. After that, Trump officials have only a few weeks to finalize the restrictions.
Even if the rule goes through, the Trump administration won’t have the chance to enforce it. But Gregg Gelzinis, a senior policy analyst for the left-leaning think tank Center for American Progress, said it “does send a chilling message to banks.”
“Republican financial regulators in the future may be willing to use aggressive tactics to pressure banks into financing their politically-favored industries.”
Power plays
Trump said Paris accord was ‘designed to kill the American economy.’
Trump railed against the Paris climate accord in a video statement from the White House during the final day of the virtual Group of 20 summit. In a final potshot against the agreement, which had the United States set goals for reducing emissions that are not legally binding, he claimed it was “not designed to save the environment, it was designed to kill the American economy.”
House Democrats seek records related to Pebble Mine.
Democratic leaders of the House Committee on Transportation and Infrastructure requested records related to the Pebble Mine to determine whether executives misled the U.S. Army Corps of Engineers and Congress about the size of the project, the Anchorage Daily News reports. The House investigation stems from secretly recorded videos that show Pebble executives saying that the project could expand beyond its initial plan for a massive gold and copper mine near Bristol Bay in Alaska.
“From the private discussions revealed by the ‘Pebble Tapes,’ it seems as though Pebble was dealing with two sets of facts, one to lure potential investors to the Pebble project and one to alleviate fears of Alaskan Natives, the U.S. Congress and federal agencies of potential adverse environmental impacts from the mine” Rep. Peter DeFazio (D-Ore.) and Grace Napolitano wrote in the letters to the U.S. Army Corps of Engineers and Pebble Limited Partnership.
Thermometer
Climate change could contribute to more drownings in winter.
A new study published Wednesday in the journal PLoS One that analyzed 4,000 winter drowning events across 10 countries in the Northern Hemisphere found that warming winter temperatures could lead to more drownings. Milder temperatures and a pattern of freezing and thawing can make ice weaker, but people may not realize the additional risks that come with winter activities such as skating, ice fishing and snowmobiling, the New York Times reports.
“Some of the sharpest increases were in areas where Indigenous customs and livelihood require extended time on ice,” NYT writes. “Across the countries studied, children under the age of 9 and teenagers and adults between 15 and 39 were the most vulnerable to winter drowning accidents.”
It’s not always easy to shop sustainably.
Consumers are confronted with a barrage of products touting green credentials, but there’s little government oversight around claims of environmental impact. “Here’s the thing about sustainable shopping: There are very few things you can purchase that are actively beneficial for the climate,” our colleague Sarah Kaplan writes.
That doesn’t mean it’s not worth making an effort. Buying energy-efficient products is one good way to reduce climate impact, and one area where the federal government tests products to see whether they meet efficiency standards. But often, when it comes to making a green purchases, “you are better off trying to refurbish or repurpose existing items than acquiring more stuff,” she adds.
