[Video] Mulvaney: We’re not spending money on
climate change
President Trump could deal
the landmark Paris climate agreement a massive blow this week.
The U.S. president is huddling
with advisers on Tuesday to explore whether he should yank America from the
international accord aimed at slowing global warming.
But some powerful forces --
with real skin in the game -- are urging Trump not to abandon the 2015 Paris
deal brokered among more than 175 nations.
Powered by SmartAsset.com
Surprisingly, it’s the big oil
companies who are vocally supporting the climate agreement, joining others in
the administration that include Secretary of State Rex Tillerson, Ivanka Trump
and her husband Jared Kushner.
Specifically,
ExxonMobil, Chevron, Royal Dutch Shell and BP are all in favor of America
staying in the Paris COP21 pact, which former President Obama hailed as “the
moment that we finally decided to save our planet.”
A BP (BP)
spokesman told CNNMoney that it “welcomed the Paris agreement when it was
signed, and we continue to support it...
“We believe it’s possible to provide the
energy the world needs while also addressing the climate challenge,” BP said.
Chevron (CVX) told
CNNMoney it “supports continuing with” the Paris deal because it “offers a
first step towards a global framework.” [It means exactly what it means,
that’s right.]
Exxon (XOM), the
biggest US oil company that Tillerson used to lead, sent a letter to the White
House last month hailing the Paris
agreement as an “effective framework for addressing the risks of
climate change.”
A Shell (RDSA)
spokesman confirmed that the energy giant remains “strongly in favor” of the
Paris deal.
At first glance, it might seem
surprising to hear that Big Oil isn’t seizing on the shifting political
environment to poke holes in a deal that undermines fossil fuels like crude
oil.
After all, Trump himself has
called climate
change a “hoax” and blasted COP21 as a “bad deal” for the U.S. (Trump later
told The New York Times he has an “open mind” about the agreement).
But these traditional energy companies
have a vested financial interest in the Paris deal. That’s because COP21’s
crack down on carbon emissions favors natural gas, which emits much less
pollution than coal.
While Exxon, BP and Shell are
primarily identified as oil companies, they are actually diversified energy
firms that rely heavily on natural gas to make money.
For instance, 42% of Exxon’s
total daily production last quarter was actually in natural gas, according to
FactSet. BP and Shell also lean on natural gas for a large chunk of their
output.
“These companies view natural
gas as a key growth area going forward for them. It just makes sense for them
to be at the table,” said Brian Youngberg, senior energy analyst at Edward
Jones.
Natural gas production has
soared over the past decade, thanks to the abundance of shale gas in North
America.
And now there’s the added
benefit that governments are cracking down on carbon emissions.
BP’s statement mentioned its
commitment to “reducing emissions in the power sector by producing and
marketing natural gas.”
And Shell needs to protect its
massive $50 billion investment last year to acquire BG Group, a sizable
producer of natural gas.
Shell put out a report in
February predicting that demand for liquefied natural gas (LNG) -- natural gas
that is turned into a liquid to ship it where it’s needed -- will jump by 4% to
5% each year to 2030. The report highlighted that governments like that natural
gas produces half the greenhouse gas emissions that coal does when it’s burnt
to produce electricity.
“You’re going to see extreme
growth in LNG,” Youngberg said.
Cheap natural gas -- not tough
environmental regulations -- has been the leading cause of the demise of coal.
Still, last month Trump tried to provide the badly struggling coal industry a
boost by starting
to undo Obama’s Clean Power Plan that aimed to cut carbon emissions by
power utilities, one of the largest sources of greenhouse gases.
Cheniere Energy, (LNG) a natural gas company, sent the White House a
letter on Monday describing the Paris agreement in terms that would fit Trump’s
America First ethos.
The Paris accord is a “useful
instrument for fostering demand for America’s energy resources and supporting
the continued growth of American industry,” Cheniere wrote.
CNNMoney’s Chris Isidore
contributed to this report.
No comments:
Post a Comment