HSBC to stop funding most new fossil fuel developments
LONDON REUTERS, PUBLISHED APRIL 20, 2018
Europe’s largest bank, HSBC, said on Friday it would mostly stop funding new coal power plants, oil sands and arctic drilling, becoming the latest in a long line of investors to shun the fossil fuels.
Other large banks such as ING and BNP Paribas have made similar pledges in recent months as investors have mounted pressure to make sure bank’s actions align with the Paris agreement, a global pact to limit greenhouse gas emissions and curb rising temperatures.
“We recognise the need to reduce emissions rapidly to achieve the target set in the 2015 Paris Agreement … and our responsibility to support the communities in which we operate,” Daniel Klier, group head of strategy and global head of sustainable finance, said in a statement.
HSBC said it would make an exception for coal-fired power plants in Bangladesh, Indonesia and Vietnam.
“There’s a very significant number of people in those three countries who have no access to any electricity,” HSBC chief John Flint told HSBC shareholders at the bank’s annual general meeting in London on Friday.
“The reasonable position for us is to allow a short window for us to continue to get involved in financing coal there … if we think there is not a reasonable alternative,” he said.
Aside from the coal exemptions environmental campaigners Greenpeace welcomed the move and said HSBC’s new energy strategy would prevent it from providing project finance for TransCanada Corp.’s proposed $8-billion Keystone XL oil pipeline to Nebraska.
“This latest vote of no-confidence from a major financial institution shows that tar sands are becoming an increasingly toxic business proposition,” John Sauven, executive director of Greenpeace UK, said in a statement.
Most of the easily extracted oil deposits are long gone. What’s left are high-cost, high-risk long shots such as the Alberta tar sands, deep-water reservoirs off Brazil, and drilling the high Arctic. Companies hoping to profit from the last dregs of the petroleum age need to convince their investors to part with massive amounts of capital in hopes of competitive returns often decades down the road.
Billions have already fled the Alberta oil sands in the last year as the global price of oil collapsed from over $100 per barrel to below $40. Shell has just called a halt to its Carmon Creek project in Northern Alberta, writing off $2bn in booked assets and 418 million barrels of bitumen reserves. A barrel of bitumen will release about 480kg of carbon dioxide from extraction, refining, transport and combustion. This head office write-down means that 200m tonnes of carbon will not be released into the atmosphere.
Two other tar sands projects were also shelved this year with reserves of about 3bn barrels. If these investments stay dead the world will avoid another 1.6tn tonnes of dangerous carbon emissions. Together the cancellation of these three projects alone amount to the equivalent of taking more than 14m cars off the road for the next 25 years.
Its message to investors is simple: the world must limit additional emissions to below 900 gigatons to avoid potentially catastrophic climate consequences – and 40% of this future carbon budget – about 360 gigatons – is projected to come from the oil sector. Anything more than that must stay in the ground – the so-called unburnable carbon.
And what’s the price of oil that could save to world? Anything below $75 a barrel of Brent crude means that companies cannot profitably extract more than 360 gigatons of the world’s remaining reserves – no messy policy solutions required.
Just last year the price of Brent crude was about $110 a barrel, a price that would gainfully produce about 500 gigatons of carbon emissions by 2050. Now it is less than $50, which would only produce 180 gigatons over the same period. If prices stay where they are, the world will avoid some 320bn tonnes of carbon emissions by 2050 in precluded production from uneconomic oil fields.
To put this in perspective, that is 25 times larger than reductions the Kyoto protocol was supposed to achieve if it had worked (it didn’t), and 180 gigatons below the oil emissions limit scientists say we need to avoid a world with more than two degrees of warming. Economic turmoil aside, the global commodities market just served up massive progress on an issue in desperate need of some good news.
Carbon Tracker recently revised its calculations to include the turmoil in the oil market, but the basic correlation is the same: lower fossil fuel prices devastate the economics of future extraction.
Seen through this lens, a key measure of our success in controlling carbon emissions should be keeping commodity prices of fossil fuels low. And while the main driver of the current slump in prices is the current glut of supply, it’s important to realise that almost every policy intervention to avert climate disaster is directly or indirectly aimed at lowering the price or profitability of fossil fuels such as oil and coal.
Efficiency and conservation incentives reduce demand, as do vehicle emission standards and investing in public transit. Carbon pricing means that fossil fuel companies can no longer use the atmosphere as a free dumping ground for CO2, so also lowering profitability.
But doesn’t cheap gas mean that people just use more of it? Not really. While there is a weak economic link between declining prices and increasing consumption, key producers like Saudi Arabia are in fact fretting that slowing growth in Asian markets and already peaked demand in developed countries will lead to a long-term decline in the world’s appetite for oil.
I dearly hope that world leaders can somehow negotiate transformative change. But perhaps the best they can do is nudge economic indicators like crude prices in the right direction and get out of the way. The unstoppable forces of the global marketplace will hopefully do the rest.
Greenpeace Protesters Blocking Oil Ship Rappel Down From Portland Bridge
By M. Alex Johnson, Jul 30 2015, 11:14 pm ET
Greenpeace protesters dangling from a Portland, Oregon, bridge lowered themselves to the Willamette River on Thursday, clearing the way for an oil company icebreaker to continue on its way to the Pacific Ocean and then the Alaskan coast.
The 13 protesters had been hanging from the St. Johns Bridge for almost 40 hours in an attempt to block Royal Dutch Shell’s icebreaker MSV Fennica — which stopped in Portland for repairs Saturday — from returning to sea.
After almost two days into the protest, members of the Portland Fire Bureau’s technical rescue rope team built their own rope system Thursday crossing the bridge, Lt. Rich Tyler said Thursday night.
Then, “we ended up lowering ourselves down to where the protesters were,” he said.
The first two protesters the officers reached agreed to lower themselves to a Multnomah County sheriff’s rescue boat in the river below.
The next ones, however, refused, “so we went down to where the ropes were connected and anchored, attached our ropes to their ropes … and lowered them down” without their cooperation, Tyler said.
Once the first three protesters had been removed and the Fennica had enough room to pass — it sailed through right under them — “the rest came down voluntarily,” he said.
Meanwhile, “kayaktivists” in the river tried to block the icebreaker’s path, but crews hooked their kayaks to jet skis and pulled them out of the way. The ship cleared the bridge about 6 p.m. (9 p.m. ET).
The ship’s next confrontation could come in Astoria, Oregon, where it was expected to arrive after 11 p.m. (2 a.m. Friday ET). The Coast Guard said it was prepared to enforce a 500-yard safety zone around the Fennica as it made its way through the Willamette and Columbia rivers Thursday night and Friday.
The protest was a costly one for Greenpeace, which was fined $2,500 for every hour the ship was stalled — eventually reaching $17,500 — after a U.S. district judge in Alaska found the organization in civil contempt.
And police carted off an undetermined number of protesters and other people in plastic handcuffs, with charges to be determined, probably Friday, police said.
But Mary Nicol, senior Arctic campaigner for Greenpeace USA, said it was worth it.
“We found that the blockade was successful,” Nicol told NBC station KGW of Portland. “Climate change does present a real threat to everyone globally.”
Royal Dutch Shell, which the U.S. Interior Department granted the final two permits it needs to explore for oil in the Arctic, said in a statement Thursday night that with the Fennica on its way to Alaska, “the Transocean Polar Pioneer commenced initial drilling operations” immediately in the Chukchi Sea.
Portland Mayor Charlie Hales said the protest made for a “hard day,” because he opposes drilling in the Arctic but had law-enforcement responsibilities as mayor to carry out.
“It’s time to move from protest to action, to changing the laws,” Hales said Thursday night. “After all, that’s the point of the protest.”
By The Oregonian/OregonLive, July 30, 2015 at 8:38 PM, updated July 31, 2015 at 6:33 AM
Just before 6 p.m. Thursday, the controversial icebreaker MSV Fennica threaded through a hole cut by law enforcement in the wall of protesters suspended from the St. Johns Bridge.
For Royal Dutch Shell, the company that will use the ship in oil-drilling operations in the Arctic, the exit marked the end of a week of protests on the Portland bridge and outside the Swan Island dry dock where a gash in the ship’s hull was repaired.
For the 13 Greenpeace USA activists on the bridge and dozens of others in kayaks and canoes on the Willamette River, it marked a disappointing end to a high-risk, high-reward protest.
“It was tough to see the boat go through there, but every second counts,” protester Razz Gormley said Thursday evening. “I consider this a victory.”
Gormley, 42, of Boulder, Colorado, climbed over the railing of the St. Johns Bridge just after 1 a.m. Wednesday and spent the next 40 hours dangling about 100 feet from the bridge’s roadway and 100 feet above the Willamette River.
The 13 suspended protesters and the minders who watched over them from the St. Johns Bridge deck hoped to prevent the Fennica from departing for the Arctic. Their goal was to delay Shell’s ship – hopefully pushing back the difficult work of drilling for oil in the Arctic long enough that the company would lose a year of work. In the time before things thawed next year, protesters hoped for political change in Washington, D.C.
As Gormley was greeted as a hero after rappelling to the water Thursday evening, he explained that even though the protesters lost the battle, they delayed the boat for hours.
Earlier Thursday, a first game of chicken was won by the protesters.
The Fennica headed downriver from Swan Island at about 6 a.m. Within about 300 yards of the St. Johns Bridge, it stopped. Dozens of kayaks and canoes pinched the river channel just in front of the 13 suspended protesters, each linked with arcing ropes between them and with a long colorful streamer trailing behind in the morning wind.
About two hours later, the ship was back at Swan Island.
Just after 2 p.m., officers from the Coast Guard, Portland police, the Multnomah County Sheriff’s Office and other Portland-area law enforcement agencies closed the St. Johns Bridge to all traffic and began to direct the river-going protesters toward the shore.
Within two hours, the Coast Guard had closed the Willamette River to all traffic between Swan Island and the Columbia River. They used boat hooks to move the smaller craft from the waterway.
Portland police Sgt. Pete Simpson and Portland fire Lt. Rich Tyler said police and fire teams closed the bridge when each agency had the resources in place to conduct a safe technical 205-foot rope rescue.
A police Special Emergency Response Team officer rappelled over the bridge and cut the lines connecting the protesters dangling from the bridge. Then Portland Fire Bureau technical rescue teams moved in, with some firefighters going over the bridge’s edge and asking the protesters to voluntarily ease themselves down to waiting boats.
The first two protesters came down on their own but the third wouldn’t communicate. Firefighters connected two rope lines to his lines, removed his anchor and lowered him on their attached lines to a boat.
Their work opened a gap just wide enough for the Fennica’s safe passage.
“It was frustrating and heartbreaking,” Philip Fensterer of North Portland said minutes after the ship cleared the bridge and the last protesters.
As the ship moved toward the Columbia River — and, ultimately, the Pacific Ocean — the remaining protesters quietly slipped off their perches. Each was greeted as a hero on the Willamette’s banks by crowds of protesters whose feelings had traveled during the day from exhilaration to anger to resignation to exhausted thankfulness.
Police initially detained protesters but by late Thursday night said they only made one arrest: 24-year-old Robert Jonah Majure, who police say locked himself to a railroad bridge and is accused of first-degree criminal trespass.
“Everybody’s hearts are broken,” Greenpeace USA spokeswoman Cassady Sharp said Thursday evening. “They’re just getting amazing love and support. That’s what makes us feel encouraged after today.”
— Laura Frazier, Molly Young, Maxine Bernstein and Stuart Tomlinson contributed to this report.