Good morning, here's what the Oilman has for you today:

• Anti-Gas Regulators May Hinder Vital Investments

• Banks Prepare for ESG Litigation

• Upcoming Oil and Gas Events

• Tweet of the Day

Anti-Gas Regulators May Hinder Vital Investments

Utilities across the U.S. are warning they need to spend billions on gas pipeline repairs and upgrades.

But regulators in some states with a gas ban agenda could prevent this.

The consequences are easy to predict.

An aging but vital network

Imagine the gas pipeline network of the country as the circulatory system.

It brings energy to power generators that then supply electricity and heating to end users.

But now, some city and state governments want to cut off parts of that system.

They believe wind and solar can do the same job as gas.

Well, with a few billion worth of batteries, but who’s counting?

And these authorities may ban utilities from fixing these pipelines.

Because they don’t believe these pipelines will be needed for much longer.

At least, that’s the version for the public.

There may be another one, though.

If the pipelines are not fit for operation, then the only alternative is whatever the authorities say.

If it doesn’t happen naturally, force it

A potential ban on investments in gas pipeline repairs would be the same as the actual ban on gasoline cars.

EVs don’t sell so well on their own, so let’s ban the alternative, and the miracle will happen.

That’s the way governments seem to think in Europe and California.

And they see absolutely nothing wrong with it.

Or preventing private companies from investing their own money as they see fit.

Now imagine a massive winter storm and only wind and solar (plus batteries!) for power generation.

Yep. It will totally work.

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Banks Prepare for ESG Litigation

Banks providing sustainability-linked loans are bracing up for potential litigation.

Scrutiny on such loans is tightening, and major reputations are at stake.

Not to mention billions of dollars.

The day of green reckoning

Sustainability-linked loans are very new.

The first one was only issued in 2017.

Since then, the market has ballooned to $1.5 trillion.

That’s right; there’s a $ 1.5 trillion market for loans that borrowers swear will be used for green purposes.

In fact, they can use the money as they wish.

Banks have so far taken them at their word.

But with greenwashing suspicions running high, this may be about to change.

So banks are trying to insure against scandal…

By adding clauses in SLL contracts that allow them to reclassify the loan as regular.

You know, if the borrower shockingly does not use the money for green purposes.

Meanwhile, SLL issuance in the U.S. is down by… 80% this year.

How did banks allow this to happen?

Simple.

They issued the loans and counted them toward their own green targets.

Imagine a company comes and says it needs $1 billion to build a solar farm.

The bank gladly signs off the loan.

The company doesn’t build a solar farm.

But the bank can show its investors this “green” loan as proof of its own efforts to go green.

Simple, right?

Deceptively so.

Now, banks are finding out the hard way that they should have paid more attention.

Why does that sound familiar?

Oh, yeah, it sounds like banks and subprime mortgages.

Upcoming Oil & Gas Events

• November 28-29: UTA Oil and Gas Conference, Hilton Americas, Houston, TX

• November 29: DUG Appalachia Conference & Exhibition, David L. Lawrence Convention Center, Pittsburgh, PA

• November 30: IPAA Texas Hold’Em Tournament, The Post Oak Hotel, Houston, TX

• December 6: Petroleum Alliance Of Oklahoma Wildcatters Wednesday Luncheon, Oklahoma City, OK

• December 6: 15th Annual PAW Wildlife & Reclamation Conference, Casper, WY

• December 6: PIOGA Mix, Mingle & Jingle Holiday Party, Wexford, PA

• December 15: 23rd Annual KOGA Christmas Party, Bodley Bullock House, Lexington, KY

Around the Global Patch

🇸🇦 Energy and mining investments: Saudi-Italian talks.
🇫🇷 France approves coal gas project lease.
🇨🇳 China permits limited export of critical minerals.

Tweet of the Day

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