Banking Giant JP Morgan Exits Climate Action Group

By Irina Slav - Feb 15, 2024

• JP Morgan Asset Management leaves Climate Action 100+ to focus on its internal sustainable investing team.
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• Climate Action 100+ notes only 13 members have exited since inception while welcoming 60 new members since mid-2023.
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• Conservative state opposition to ESG investing may be a contributing factor to exits from climate pressure groups in the financial industry.
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JP Morgan Asset Management has left the Climate Action 100+ group that was set up to pressure companies into becoming greener.

The reason for the move, per the Financial Times, is that the bank’s asset management arm believes it has accumulated the expertise to push companies into climate action on its own.

“The firm has built a team of 40 dedicated sustainable investing professionals,” a spokeswoman for JP Morgan Asset Management told the FT. “Given these strengths and the evolution of its own stewardship capabilities, JPMAM has determined that it will no longer participate in Climate Action 100+ engagements.”

Climate Action 100+ was set up in 2017 with the purpose of forcing heavy emitter companies into cutting their carbon footprint. The group’s targets included oil and gas, the air travel industry and other energy-intensive industries.

In response to JPMAM’s exit, Climate Action 100+ said only 13 members have ended their membership in the group since its establishment while new members since mid-2023 stood at 60.

JP Morgan Asset Management is not the first member to leave the group. Last year saw the exit of several smaller investment firms such as Boston-based, Natixis-owned Loomis Sayles and BNY Mellon-owned Walter Scott.

Current members include BlackRock, Goldman Sachs, and Invesco, while Vanguard and Fidelity never joined the group, the FT recalls.

The past couple of years also saw several high-profile exits from anther net-zero formation in the financial services world. Vanguard surprised the industry when it abruptly left the Net Zero Asset Managers group saying it wanted more independence and clarity for its investors.

There have been lower-profile exits from climate pressure groups in the industry, too. One reason that analysts cite for this is conservative state governments’ push against so-called ESG investing, which many have argued is discriminatory. Some states, notably Texas, threatened to pull out their investments from asset managers that supported the ESG investing movement.

By Irina Slav for Oilprice.com

Barclays Lags European Peers in Halt To Funding New Oil and Gas Fields

By Tsvetana Paraskova - Feb 14, 2024

• UK banking giant Barclays has just announced that it will drop direct funding for new oil and gas projects.

• Campaigners, however, say that Barclays could have gone further in its commitments and that the announcement of the UK banking giant now puts pressure on the U.S. banks.
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• Barclays is also looking to avoid claims of greenwashing with a new set of guidelines about what ‘transition finance’ is and how its new transition finance team should apply it.

UK banking giant Barclays has just announced that it will drop direct funding for new oil and gas projects, joining other major European banks in halting the financing of fossil fuel expansion.  

Barclays has been one of the top ten banks financing fossil fuels globally since 2016, just after the Paris Agreement was signed, according to the 14th annual Banking on Climate Chaos report published by environmental groups last year. Estimates by climate campaigners, including Rainforest Action Network and Reclaim Finance, showed that Barclays spent $190.58 billion on funding fossil fuels between 2016 and 2022, becoming the world’s seventh-largest and Europe’s biggest banker of oil, gas, and coal since the Paris Agreement. Four U.S. banks, a Canadian bank, and a Japanese bank, are ahead of Barclays in financing fossil fuels.

Europe’s biggest lender to fossil fuel projects has just pledged to restrict financing for oil and gas, including direct funding for new projects, in a move welcomed by environmental groups. Campaigners, however, say that Barclays could have gone further in its commitments and that the announcement of the UK banking giant now puts pressure on the U.S. banks, which are the top lenders to the fossil fuel industry—JP Morgan, Bank of America, and Citi.Related: Trump Can't Stop Energy Transition: Kerry

Last week, Barclays said in its revised Climate Change Statement that it would no longer provide project finance or other direct finance to energy clients for upstream oil and gas expansion projects or related infrastructure. The bank will also impose restrictions for new energy clients engaged in the expansion of oil and gas, as well as restrictions on non-diversified energy clients engaged in long lead expansion. Barclays is putting additional restrictions on unconventional oil and gas, including Amazon and extra heavy oil.

The bank will also require its energy clients to have 2030 methane reduction targets, a commitment to end all routine/non-essential venting and flaring by 2030, and near-term net-zero-aligned Scope 1 and 2 targets by January 2026.

Barclays is also looking to avoid claims of greenwashing with a new set of guidelines about what ‘transition finance’ is and how its new transition finance team should apply it.

Barclays is late to the party. Other banks in Europe have already started to reduce funding to oil and gas projects as part of their own climate targets.

UK’s HSBC said that at the end of 2022, it would stop funding new oil and gas field developments and related infrastructure as part of a policy to support and finance a net-zero transition.

France’s biggest bank, BNP Paribas, said in May 2023 that it would no longer provide any financing for developing new oil and gas fields, regardless of the financing methods. The bank also pledged to reduce its financing for oil exploration and production by 80% by 2030 as part of its energy transition goals.

Barclays’ announcement this month was welcomed by campaigners, who naturally want further restrictive moves from the bank and its peers “to stop helping wreck the climate.”

Although Barclays’ updated policy “contains some positive commitments,” “the strategy could have gone so much further,” Kelly Shields, Campaign Manager at responsible investment charity ShareAction, said in a statement.

“Barclays is wrong not to have ruled out financing companies that focus exclusively on fossil fuel extraction. This should include fracking, which is causing so much environmental and social harm and is an activity the bank is heavily exposed to,” Shields added.

Barclays is “a bit late” compared to its European peers, ShareAction senior research manager Xavier Lerin told Euronews Green.

“Barclays is taking a similar approach but retains a lot of discretion as to how it will restrict financing, while peers are ahead of the curve because they have clearly said we’re not going to finance these companies anymore,” Lerin noted.

The halt to new oil and gas project funding from Barclays is putting pressure on U.S. and Canadian banks to announce similar policies, Rainforest Action Network and other campaigners said.

“The new policy, while still not strong enough, stands in stark contrast to backsliding by US banks and inaction by Canadian banks,” they added.

“While it’s clear that Barclays still has much work to do to actually deliver on its own climate commitments, these moves further widen the climate ambition gap by banks across the Atlantic,” said Adele Shraiman, Senior Strategist, Sierra Club Fossil-Free Finance Campaign.  

By Tsvetana Paraskova for Oilprice.com

Starlink Terminals Are Falling Into the Hands of the Russian Military

By RFE/RL staff - Feb 16, 2024

• Ukrainian military heavily depends on Starlink for stable communications between units and commanders.
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• Evidence suggests that Russian troops are using Starlink for their own communications or potentially to monitor Ukraine's.
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• Despite claims by Starlink that they don't sell terminals to Russia, reports indicate Russian troops may have acquired them through various channels, raising concerns about security breaches and compromised military communications.
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Russian troops in Ukraine increasingly have access to Starlink, the private satellite Internet network owned by Elon Musk that Ukraine's military relies on heavily for battlefield communications.

The findings from RFE/RL's Russian Service corroborate earlier statements from Ukrainian military officials, underscoring how Kyiv's ability to secure its command communications is potentially threatened.

It comes as Ukrainian forces grapple with depleted weaponry and ammunition, and overall exhaustion, with Russian forces pressing localized offensives in several locations along the 1,200-kilometer front line. The industrial city of Avdiyivka, in particular, is under severe strain with Russian forces making steady advances, threatening to encircle Ukrainian defenses there.

Ukraine has relied heavily on Starlink, a network for low-orbit satellites that provide high-speed Internet access. The network is owned by SpaceX, the private space company that is in turn owned by Musk, the American billionaire entrepreneur

They are used on the front line primarily for stable communications between units, medics, and commanders. Ukrainian troops have also experimented with installing Starlink antennas on large attack drones, which are an essential tool for Ukrainian troops but are frequently jammed by Russian electronic-warfare systems.

However, a growing number of Ukrainian military sources and civilian activists have pointed to evidence that Russian troops are using the network, either for their own communications or to potentially monitor Ukraine's.

On February 11, Ukraine's military intelligence service, known as HUR, said Russian forces were not only using Starlink terminals but also doing it in a "systemic" way. HUR also published an audio excerpt of what it said was an intercepted exchange between two Russian soldiers discussing how to set up the terminals.

Units like Russia's 83rd Air Assault Brigade, which is fighting in the partially occupied eastern region of Donetsk, are reportedly using the system, HUR spokesman Andriy Yusov was quoted as saying.

Ukraine's Defense Ministry, meanwhile, said on February 13 that Russia was acquiring Starlink terminals from unnamed Arab countries.

Starlink has said that it does not do business with Russia's government or its military, and Musk himself published a statement on his social-media company X, formerly Twitter, in response to the Ukrainian assertions.

"A number of false news reports claim that SpaceX is selling Starlink terminals to Russia. This is categorically false. To the best of our knowledge, no Starlinks have been sold directly or indirectly to Russia," Musk wrote on February 11.

Russian troops may have acquired Starlink terminals from one of potentially dozens of companies within Russia that claim to sell them alongside household products, RFE/RL found.

One Russian website, called Topmachines.ru, advertised a Starlink set for 220,000 rubles (about $2,200), and a $100 monthly subscription fee.

Starlink appears to have lax oversight on the type of personal data used by new Starlink clients when they register for the first time, as well.

One Moscow-based reseller told RFE/RL that new accounts were registered with random European first and last names and that there is no need to enter a valid European passport. The only important thing, the vendor said, is to have a valid bank card that uses one of the main international payment systems.

Another vendor told RFE/RL that the terminals he sold were brought in from Europe, though he declined to specify which country. The vendor said a terminal costs 250,000 rubles (about $2,400), and the monthly fee was 14,000 rubles

Additionally, Starlink's technology appears to be incapable of precisely restricting signal access; independent researchers say Starlink's system only knows the approximate location of its terminals, meaning it would have to restrict access for Ukrainian frontline positions in order to limit Russian battlefield use.

IStories, an independent Russian news outlet, also identified at least three vendors in Moscow who claim to sell Starlink terminals.

Asked by reporters whether Russian troops might be using Starlink terminals, Peskov said: "This is not a certified system with us, therefore, it cannot be supplied and is not supplied officially. Accordingly, we cannot use it officially in any way."

By RFE/RL

TC Energy Books Record Earnings amid High Natural Gas Demand

By Tsvetana Paraskova - Feb 16, 2024

TC Energy Corporation reported on Friday record comparable core earnings and earnings per share for 2023, topping analyst estimates, as demand for natural gas and LNG surged.

The Canada-based pipeline giant booked US$8 billion (C$11.0 billion) in earnings before interest, tax, depreciation, and amortization (EBITDA) for 2023, up by 11% compared to 2022. Comparable earnings per common share rose by 5% annually to US$3.35 (C$4.52) in 2023.

TC Energy’s deliveries to power generators on its U.S. Natural Gas Pipelines continued to grow, setting a record of 2.8 billion cubic feet per day (Bcf/d) during the fourth quarter of 2023, up by 16% year-on-year. The Gas Transmission Northwest (GTN) system achieved an all-time delivery record of 3.1 Bcf on November 11, 2023, the company said in a statement.  

Strong gas demand underpinned record deliveries at TC Energy’s natural gas division. 

“Within our integrated natural gas pipelines business, total NGTL System deliveries in Canada averaged 14.5 Bcf/d and various pipelines in the U.S. achieved record throughput volumes,” chief executive CEO François Poirier said.

“The GTN system achieved a delivery record of 3.1 Bcf on November 11, 2023, Tuscarora Gas Transmission System achieved a delivery record of 0.2 Bcf on November 30, 2023, and the Portland Natural Gas Transmission System achieved a delivery record of 0.5 Bcf on December 12, 2023.”

Last year, TC Energy achieved mechanical completion on the Coastal GasLink project ahead of its end-2023 target.  

The Coastal GasLink, like any pipeline project in Canada, spurred a lot of opposition from anti-oil and gas activists but they could not suspend the construction of the infrastructure, which should help put Canada on the global LNG stage at a time of elevated demand. The pipeline will feed gas from Dawson Creek, near the border of British Columbia with Alberta, to the LNG Canada plant on BC’s coast.  

By Tsvetana Paraskova for Oilprice.com

Electric Vehicle Giant BYD Plans Factory in Mexico

By Irina Slav - Feb 16, 2024

Chinese electric vehicle major BYD is considering opening a factory in Mexico, the Wall Street Journal has reported.

Citing unnamed sources, the publication said that BYD was scouting for suitable locations. The factory would manufacture cars for the U.S. market, the sources also said.

Chinese EV makers are the top sellers globally after Tesla. That’s because they sell on their local market and that market is huge. But now it is reaching saturation point so the companies are beginning to look abroad. BYD, by the way, dethroned Tesla as the largest EV sells in thw world in the final quarter of 2023.

European carmakers are already spooked by Chinese EV manufacturers’ plans to enter the European market and start offering same-quality, lower-price cars. To that end, the EU launched an investigation into subsidy practices in the EV space in China – while continuing to offer subsidies to EV buyers at home.

U.S. carmakers could sleep easily until now, safe in the knowledge that tense political relations between Washington and Beijing were hardly conducive to a Chinese EV invasion. They probably forgot about Mexico.

The United States has a free-trade agreement with its southern neighbors. This means that cars manufactured in Mexico cannot be subject to tariffs if they are to be exported north of the border. And the car industry is beginning to worry, even though the WSJ sources noted that BYD had yet to make a final decision on the Mexico factory.

The report also noted that Chinese companies active in the EV industry had been opening factories in Mexico in recent years or expanding already existing manufacturing capacity. The expansion is quite likely a response to the Biden administration’s ambitious electrification goals for the transport industry, with plans for 67% of all cars sold in 2032 to be EVs.

By Irina Slav for Oilprice.com

 

Iraqi Kurdistan Oil Export Restart Still A Way Off

By Julianne Geiger - Feb 16, 2024, 

There is no forecasted date for when oil exports from Iraq’s semi-autonomous Kurdistan region to Turkey will resume, a Patriotic Union of Kurdistan (PUK) leader said on Friday.

On the sidelines of the Munich Security Conference on Friday, Bafel Talabini told Argus that the relationship between Baghdad and Erbil was a “very delicate” one, and one wrong negotiating move could upend the entire process of restarting pipeline exports to Turkey.

For months, the pipeline between the two countries has been out of commission since March 2023, after a squabble between the Iraqi government, the Kurdistan Regional Government (KRG), and Turkey over KRG crude that had been making its way to Turkey via pipeline. The International Chamber of Commerce decided in March that Turkey could only purchase oil from Iraq through Iraq’s State Organization for Marketing of Oil (SOMO) and that it must pay Iraq $1.47 billion in compensation for oil exports between 2014 and 2018, when it didn’t have official Iraqi permission to purchase oil directly from the KRG.

Turkey balked at the ruling and sent Baghdad additional conditions that would need to be met before exports would resume—conditions that Iraq wasn’t interested in meeting. And with oil flows via pipeline between KRG and Turkey halted, an apparent stalemate ensued and continues today.

The groups from time to time hint that a new deal for resumption is imminent, but the last few updates on the subject from the parties involved suggest that a deal is still not near.

So while the pipeline is physically ready to resume operations, the spatting parties are anything but—and the international oil companies currently operating in KRG are getting ancy and have been putting pressure on the U.S. government to hurry a deal along.

By Julianne Geiger for Oilprice.com

Exxon Carries on Drilling Off Essequibo Despite Venezuela's Objections

By Editorial Dept - Feb 16, 2024

Politics, Geopolitics & Conflict

-Ukraine said this week that it had destroyed a Russian warship off the coast of occupied Crimea, sinking the vessel with navy drones. This comes amid a number of developments related to the war in Ukraine this week, including a Ukrainian strike on a Russian border town, Belgorod, near a shopping center, in which seven people were killed on Thursday. The flashpoint, frontline city in Ukraine is now Avdiivka, near occupied Donetsk, which the Russians have turned their attention to. The Russians have yet to make any decisive breakthrough.

-Estonian intelligence warning that Russia is preparing for a military confrontation with the West in the next decade–analysis derived from the fact that Russia is planning to double its military troops at its borders with Finland and the Baltics.

-In Guyana, we view Venezuela’s deploying more troops to the border as tensions over Maduro’s claim on the oil-rich Essequibo area rise. Venezuela is building up its troop presence on Ankoko Island, a disputed territory on the border area with Guyana. The build-up is likely more of a smokescreen for Maduro, who has launched an all-out war with the opposition in Caracas in the face of presidential elections that are planned for this year. The buildup itself is unimpressive in terms of scale.

-On Thursday, U.S. Centcom said its forces had seized a weapons shipment from Iran en route to Yemen’s Houthis, who continue their bombardment of the Red Sea shipping lane. U.S. forces seized unmanned underwater surface vehicle components, anti-tank launcher assemblies and medium-range ballistic missile components, among other weaponry.

Deals, Mergers & Acquisitions

-BP and ADNOC will form a natural gas JV in Egypt, in line with ADNOC’s goal of growing its presence internationally, as evidenced by other international projects such as in Azerbaijan. The JV will also further cement Egypt’s ties with the UAE, which has been a supporter of El-Sisi. As part of the new deal, BP will contribute towards three development concessions, and ADNOC will help foot the bill for growth opportunities in an unspecified amount. The deal will give the UAE a foothold in the European LNG market, of which Egypt is a supplier.

-Diamondback Energy will purchase privately held Endeavor Energy in a $26B deal, comprising $17.8B of Diamondback stock and $8B in cash. The resulting entity will be 60.5% by Diamondback and 39.5% by Endeavor, boasting a market cap of $50B.

Discovery & Development

-Cyprus’ first natural gas production could begin as soon as 2026, and the presidential republic also plans to participate in a high-powered electricity cable project that would link the eastern Mediterranean to continental Europe. The island would greatly benefit from a hook-up to overseas power markets, and domestic gas production could also change. The gas discovery that will be first to production will likely be TotalEnergy and Eni’s 2022 discovery known as Cronos, which is thought to hold 2.5 tcf of gas. The project would see nat gas delivered to Eni’z Zohr facilities in Egypt. Eni completed the drilling of a second appraisal well at Cronos this week.

-Wintershall Dea will drill more appraisal wells in its shallow-water discovery known as Kan-1EXP in Block 30 of the Sureste basin offshore Mexico, with last year’s pre-drill estimating the wildcat’s resource potential to be 78.5 million boe with a 40% probability of success.

-Var Energi ASA drilled two dry wells at its Hubert and Magellan prospects in PL 917 off the coast of Norway. The wells were the third and fourth in the license, and have since been permanently plugged. Var Energi is the operator of PL 917 at 40%. Its partners are Aker BP (40%) and Equinor (20%).

-Despite Venezuela’s objections, Exxon said it would carry on with its drilling in Essequibo in Guyana’s Stabroek block. Venezuela’s pushback and insistence that the area in question rightfully belongs to Venezuela likely brings back bad memories for Exxon following the country’s nationalization of Exxon’s oil assets back in 2007–a move that the World Bank said in 2014 would cost PDVSA $1.6B.

Wind and Solar Growth in China Not Enough to Offset Coal Expansion

By Irina Slav - Feb 16, 2024

• China's economic growth leads to increased coal usage despite significant wind and solar capacity additions.
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• Economic stimulus measures, including direct loans and tax cuts, are expected to boost business activity and energy consumption.
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• The situation in China and Europe challenges the notion of wind and solar entirely replacing traditional fuels, highlighting the complex relationship between economic growth and energy demand.

In 2023, China’s economy expanded by 5.3%. This would have been an impressive number worth celebrating for any other country. For China, however, the number was widely seen as a disappointment—even though it exceeded analyst expectations.

As a result of these apparently disappointing developments, analysts expect Beijing to lean heavily on stimulus this year. And this would mean higher emissions.

The link between economic growth and cheap energy is one that does not get much public attention since that attention tends to be focused strictly on emissions. Yet, this is a link that is hard to overlook.

Last year, Germany saw its emissions decline to the lowest in 70 years. Germany also slipped into a recession in 2023. The UK, which is at least as ambitious in the climate change department as Germany, is also expected to report an economic contraction for 2023, although it has been less fortunate with emissions. But it’s trying.

China is also trying, still leading in terms of wind and solar generation capacity. Yet China is also building a lot of new coal capacity, which the government says will be used as backup for the intermittent renewables. Before that, however, coal is expected to be used as the fuel of the economic stimulus—and lead to higher emissions.

Reuters columnist Gavin McGuire wrote this week that the stimulus measures analysts expect the Chinese government to deploy could include things like direct loans to businesses and tax cuts. This, McGuire noted, would lead to a boost in business activity, and that boost will, in turn, lead to higher energy consumption.

Despite having the largest wind and solar capacity in the world, China is still heavily reliant on coal-generated electricity, so this would likely increase if the stimulus measures work as planned. And coal generation output might just break last year’s record of 5,760 TWh. With it, emissions will rise, even as wind and solar installations continue to grow and fast.

Last year, China installed 217 GW of solar and 76 GW of wind capacity. That was a 55% annual increase in solar additions, and in wind, China installed more new capacity than the rest of the world combined.

The Wall Street Journal cited analysts as saying that together with new nuclear and hydro additions, the above covered all of China’s new demand for power in 2023. And yet coal generation hit a record high—quite likely because the country’s economy expanded by 5.3%.

The Wall Street Journal report suggested that thanks to the massive additions of wind and solar, emissions in China could peak ahead of schedule. Yet the Reuters column makes a different suggestion, despite expectations of weaker economic growth this year. Perhaps it won’t be so much weaker with stimulus. And it will lead to higher coal – and gas – generation even as wind and solar continue to expand.

The conclusions that this situation prompts do not exactly support arguments about the capability of wind and solar to entirely replace hydrocarbons as power generation fuel. If anything, they destroy those arguments with the evidence from China.

That evidence, by the way, also gets support from data from Europe. Wind and solar generation in Europe has been shattering records—but economic growth has been stalling, and energy demand has been weakening because of price inflation. One could perhaps put it all down to coincidences and correlation not equaling causation.

Yet, given the fundamental importance of affordable energy for economic growth, coincidence and correlation rather than causation might not cut it as an explanation. If you want economic growth, there will be emissions.

By Irina Slav for Oilprice.com

Turkey detains 4 as part of a probe into a gold mine landslide that left at least 9 missing


BY SUZAN FRASER
 February 14, 2024

ANKARA, Turkey (AP) — Authorities on Wednesday detained four people in connection with a massive landslide that engulfed a gold mine in eastern Turkey, leaving at least nine workers missing, Turkish state media reported.

The landslide struck the Anagold Madencilik company’s Copler mine in the town of Ilic in Turkey’s mountainous Erzincan province on Tuesday. A video, seemingly shot by a worker, showed a huge mass of earth rushing down a gully, overrunning everything in its path. The landslide involved a mound of soil extracted from the mine, Interior Minister Ali Yerlikaya said.

More than 800 search and rescue personnel, including police and military teams, mine rescuers and volunteers, were deployed to search for the nine missing personnel, Yerlikaya said.

Other workers at the mine have also joined the efforts to rescue their colleagues, while families of the missing waited in an area close to the mine for news of their loved ones, Haberturk television reported.

READ MORE

9 gold mine workers are missing in Turkey after a landslide that carries environmental risks

Police, meanwhile, detained four senior mine officials, including the field manager, as part of an investigation into the disaster, national broadcaster TRT reported

Speaking during a visit to Egypt, Turkish President Recep Tayyip Erdogan said the search and rescue mission would continue until all of the mine workers are found.

“Search and rescue efforts for these nine brothers are continuing intensively,” Erdogan said. “The efforts will continue until we reach the workers.”

Yerlikaya later told reporters that five of the missing workers were believed to be near or inside a metal container when the landslide hit. Three others were either inside or close to a vehicle, while another was inside a truck, he said, adding that rescuers were using radar detection devices to try to locate the missing.

“We have an advantage in this mass (of earth),” Yerlikaya said. “We have started to search (for the vehicles and container) with metal radar detection. As soon as we get a trace of these vehicles and container with these radar scans, we want to focus on them and make progress.”

Experts have warned that the landslide may carry environmental risks. Geologist Suleyman Pampal said the soil that formed the landslide had been processed for gold and may contain dangerous substances such as cyanide that is used to extract gold. He also warned of a threat to the nearby Euphrates River.

The Environment Ministry said in a statement that a stream leading to the Euphrates was closed to prevent water pollution. Erzincan Gov. Hamza Aydoglu also said there was no leakage into the waterway.

The mine was closed down in 2020 following a cyanide leak into the river, which stretches through Turkey, Syria and Iraq. It reopened two years later after the company was fined and a cleanup operation was completed.

Energy Minister Alparslan Bayraktar said the mine was last inspected in August.

“During their inspections, they did not find anything relating to the mining accident that took place yesterday,” Bayraktar told reporters near the site. “Our investigation into what may have caused the accident is continuing.”

Turkey has a poor mine safety record. In 2022, an explosion at the Amasra coal mine on the Black Sea coast killed 41 workers. The country’s worst mining disaster took place in 2014 at a coal mine in Soma, western Turkey, where 301 people were killed.

In the wake of those incidents, engineers warned that safety risks were frequently ignored and inspections not adequately carried out.

Rusal to add Abramovich to lawsuit against Potanin over nickel miner pact

Reuters | February 16, 2024 | 

Russian businessman Roman Abramovich.

 (Image: Wochit News | YouTube.)

Aluminum giant Rusal obtained permission by a London court on Friday to add Russian billionaire Roman Abramovich and his firm Crispian Investments Ltd as defendants in the case against Vladimir Potanin, CEO of Nornickel.


The application marks the latest flare-up in relations between two of Russia’s biggest metal companies.

Nornickel is the world’s largest palladium producer and a major miner of refined nickel. Potanin holds a 37% stake in it, while Rusal holds 26.4% and former Chelsea Football Club owner Abramovich has a 4% stake.

The aluminum giant claims that Potanin violated a shareholder agreement signed in December 2012, causing losses for Rusal. Abramovich and his investment company Millhouse, later replaced by Crispian Investments, were parties to the deal.

Crispian Investments objected to Rusal’s application, while Abramovich did not respond to it, said David Mumford, KC for Rusal at Friday’s hearing.

Judge Sean O’Sullivan, however, ruled that Abramovich and Crispin could be added to the case, after the hearing.

“The joining of Crispian Investments Limited and Mr. Roman Abramovich as parties to the case is another step for the implementation of Rusal’s claims against Mr. Vladimir Potanin and his company Whiteleave Holdings Limited,” Rusal said in an emailed statement.

Potanin’s Interros holding company declined to comment.

Nornickel has not been directly targeted by Western sanctions after Russia’s invasion of Ukraine, but Britain has placed sanctions on Potanin and Abramovich.

Oleg Deripaska, founder of Rusal and also sanctioned by Britain, is not a party to the litigation.

The dispute that led to the lawsuit, first filed in October 2022, and Rusal’s further claims, centre on the 2012 framework agreement between Nornickel’s two largest shareholders, which protected dividend payouts among other things.

Disagreements over dividends and governance have been the main reason for on-and-off rows. At the time of the 2012 framework agreement, Abramovich helped to cool a dispute over how much profit should be returned to investors and how much should be invested in Nornickel.

Rusal alleges in court filings that Potanin “had overseen the transfer of crucial assets out of the NN Group (Nornickel) under false pretences and/or at undervalues to the advantage of himself and his associates, dishonestly procured the transfer out of …the NN Group of hundreds of millions of dollars and mismanaged the NN Group, which has led directly to certain industrial accidents.”

(By Clara Denina, Sam Tobin and Polina Devitt; Editing by Marguerita Choy)

Mexican mining sector balks at plan to ban open-pit mines

Reuters | February 15, 2024 | 


La Herradura, one of Mexico’s largest open-pit gold mines. 

(Image by Fresnillo.)

Mexican President Andres Manuel Lopez Obrador’s proposal to ban open-pit mining will generate uncertainty and curtail investment for the key sector, mining industry representatives said this week.


Lopez Obrador announced the proposal to prohibit new concessions for open-pit projects last week amid a slew of initiatives as he looks to shape political debate ahead of a June presidential election that his protégé is expected to win.

The proposal is unlikely to pass in the short-term, as Lopez Obrador does not have the two-thirds super majority in Congress needed to change the constitution.

But the frontrunner to succeed him, former Mexico City Mayor Claudia Sheinbaum, has said she will adopt his proposals as part of her platform.

The industry says such a move would be disastrous for the sector, which fuels 2.5% of gross domestic product. Mexico is the world’s top silver producer and a major gold and copper producer.

Of the 124 mines affiliated with the Camimex mining chamber, fewer than half are open-pit yet they represent 60% of Mexico’s output, according to the chamber.

“Prohibiting open-pit mining would imply the destruction of a strategic sector,” the chamber said in a statement this week.

It said open-pit mines represent more than $3.9 billion in investment and 200,000 direct jobs, and warned that a ban would eventually affect supply chains, forcing Mexico to import minerals at a higher cost.

Since taking office in 2018, Lopez Obrador has not granted mining concessions of any type, arguing that past governments gave too many approvals.

Mining executives have previously raised concerns over that practice as well as a 2023 law that shortened concessions and tightened water extraction permits.

“It’s no secret that this administration has been averse to mining,” said Jorge Ganoza, president of Canada’s Fortuna Silver Mines, which operates an underground silver and gold mine in southern Mexico. “If it were to continue, we would certainly see Mexico lose ground compared to other mining nations.”

Fortuna Silver has cut investment in Mexico from nearly half of its global spending to around 10% in recent years, he said.

That trend could continue if the proposal passes, said Riyaz Dattu, an attorney who advises Canadian companies on international arbitration. Canada represents 70% of foreign mining investment in Mexico.

“Companies cannot operate without an understanding on whether their investments will hold true in the next 10-20 years,” he said. “This will drive investments away.”

Environmentalists say open-pit mining carves out swaths of earth and uses dangerous chemicals, and Mexican Environment Minister Luisa Albores has called it “the most polluting” type of mining.

The ministry is also seeking to end fracking and prohibit concessions in water-scarce areas.

(By Daina Beth Solomon and Divya Rajagopal; Editing by Ernest Scheyder and Rosalba O’Brien)