CRIMINAL CAPITALI$T CONSULTANT

McKinsey to pay US$573 million for role in US opioid crisis

Lawsuits unearthed documents showing how McKinsey worked to drive sales of Purdue Pharma's OxyContin painkiller.

PHOTO: REUTERS

NEW YORK (NYTIMES) - McKinsey & Co, the consultant to blue-chip corporations and governments around the world, has agreed to pay US$573 million (S$764.8 million) to settle investigations into its role in helping "turbocharge" opioid sales, a rare instance of it being held publicly accountable for its work with clients.

The firm has reached the agreement with attorneys general in 47 states, the District of Columbia and five territories, according to five people familiar with the negotiations. The settlement comes after lawsuits unearthed a trove of documents showing how McKinsey worked to drive sales of Purdue Pharma's OxyContin painkiller amid an opioid epidemic in the United States that has contributed to the deaths of more than 450,000 people over the past two decades.

McKinsey's extensive work with Purdue included advising it to focus on selling lucrative high-dose pills, the documents show, even after the drugmaker pleaded guilty in 2007 to federal criminal charges that it had misled doctors and regulators about OxyContin's risks. The firm also told Purdue that it could "band together" with other opioid-makers to head off "strict treatment" by the Food and Drug Administration.

McKinsey will not admit wrongdoing in the settlement, to be filed in state courts on Thursday (Feb 4), but it will agree to court-ordered restrictions on its work with some types of addictive narcotics, according to those familiar with the arrangement. McKinsey will also retain emails for five years and disclose potential conflicts of interest when bidding for state contracts. And, in a move similar to the tobacco industry settlements decades ago, it will put tens of thousands of pages of documents related to its opioid work onto a publicly available database.

States will use the civil penalties - US$478 million of which must be paid within 60 days - for opioid treatment, prevention and recovery programs, the people said. It will be the first money states will see after Purdue Pharma in October agreed to pay US$8.3 billion and plead guilty to federal criminal charges over its marketing of OxyContin. Purdue declared bankruptcy, meaning the states party to that agreement will have to line up with other creditors.

Separately, members of the Sackler family, who own Purdue, agreed last fall to pay the federal government US$225 million in civil penalties, and are in talks with other litigants to pay US$3 billion.

Many states were dissatisfied with the October deal, which the Trump administration's Justice Department reached only days before the former president was defeated in November's election.

The amount McKinsey is paying is also substantially more than it earned from opioid-related work with Purdue or Johnson & Johnson, Endo International and Mallinckrodt Pharmaceuticals, its other opioid-maker clients, one of the people said.

A spokesman for McKinsey did not immediately respond to requests for comment.

One former McKinsey partner called the settlement hugely significant because it shatters the distance McKinsey - which argues that it only makes recommendations - puts between its advice and its clients' actions. For decades, the firm has avoided legal liability for high-profile failures of some clients, including the energy company Enron and Swissair, Switzerland's defunct national airline. The former partner asked for anonymity because former McKinsey employees are bound by confidentiality agreements.

Making McKinsey and its competitors even more vulnerable is the fact that in recent years they have aggressively moved into a new line of work, not only offering management advice but also helping companies implement their suggestions.

"As we look back at our client service during the opioid crisis, we recognize that we did not adequately acknowledge the epidemic unfolding in our communities or the terrible impact of opioid abuse and addiction on millions of families across the country," the company said in a statement. The firm later changed the statement to read "misuse" instead of "abuse."

The agreement with the 47 states - Nevada, Washington and West Virginia weren't party to it - doesn't preclude the Biden administration from also seeking legal action against McKinsey. Additionally, several counties and cities across the country - including Mingo County in West Virginia, one of the states hardest hit by the opioid crisis - have sued McKinsey in recent days.

The Asian Voice
Indian farmer protests a daunting challenge for Modi government: Daily Star columnist
The writer says that had the Bharatiya Janata Party foiled the farmers' journey through its territory, it might have given rise to a serious law and order situation, something the saffron party can ill-afford.

Indian security personnel clash with Indian people during a protest in solidarity with Indian farmers who are protesting at various borders adjoining New Delhi, India on Feb 3 2021. 

PHOTO: EPA-EFE

Pallab Bhattacharya

2/3/2021

DHAKA (THE DAILY STAR/ASIA NEWS NETWORK) - The biggest political challenge that Indian Prime Minister Narendra Modi's government faces right now is the agitation on the outskirts of Delhi by farmers coming mainly from Punjab, Haryana and western part of Uttar Pradesh.

The protest by thousands of farmers has already entered its third month, and there is no sign of a resolution even after eleven rounds of talks between the protesters and the government.

Both sides are firmly entrenched in their respective position on the fate of the three new contentious agricultural laws piloted by the Modi government as one of its bold reform initiatives.


While the farmer unions insist on total repeal of the laws, the government has offered to make changes in the legislation to address their concerns, an offer that the unions lost no time in rejecting.

What's more worrying for the government is that the farmers are intensifying their agitation and have threatened to block highways across India on Feb 4 to press their demand.

Desperate to end the protest which has already set off churnings within a section of the ruling Bharatiya Janata Party (BJP) and its ideological mentor Rashtriya Swayamsevak Sangh (RSS), the government had offered to put the three laws on hold for 18 months to allow more discussions on the issue.

But it did not work as the protesters apparently took it as a sign of its defensive posture. The offer to suspend the laws was made after taking a cue from a suggestion made earlier by the Supreme Court.

The apex court's proposal to appoint an expert panel to study the laws was seen as "a face saver" for the government, but some have also called it a "judicial overreach".

The agitation, which had been peaceful for the first two months, took a violent turn on Jan 26 when the farmers riding tractors smashed through security barricades and entered the Indian capital from various points.

The most serious part of the violence was the protesters storming the Red Fort, an iconic Mughal-era landmark, and the hoisting of a religious flag at the ramparts from where the prime minister addresses the nation on Independence Day on August 15 every year.

There have been allegations and counter-allegations from both sides, but there is no doubt that the violence came as a setback to the farmers who were hit by a rift as two of the 40-odd unions of farmers pulled out of the agitation.

A number of national and regional farm unions, with separate leaders, have come under the umbrella banner of Samyukt Kisan Morcha for the ongoing agitation.

However, the protest by the other unions not only continues but the number of protesters also appears to be swelling.

The three new laws in question are: The Farmers' Produce Trade and Commerce (Promotion and Facilitation) Act, The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, and The Essential Commodities (Amendment) Act.

The farmers' contention is that the laws will lead to the creation of private mandis (village markets for selling crops) which, along with the state-run Agriculture Produce Market Committees (APMC), will push all agriculture businesses towards private markets.

This, they argue, will end the existing government markets and intermediary (commission agents) mechanism for procurement and allow large, financially powerful traders and corporate houses operating in the markets to procure farm produce at "incidental" prices.

The farmers also want the federal government to provide the legal guarantee of a minimum support price (MSP) for their crops by introducing a new law.

Another key contention of the farmers is that since the state governments will not be able to collect market fee, cess (a form of tax) or levy for trade outside the APMC markets, the laws will make them vulnerable to corporates which might exploit them.

On the other hand, the government has proposed that there will be a uniform policy of taxes, fee and cess for both government and private markets.

But the farmers are distrustful of that, claiming the government would delay procurement and turn the public markets inefficient.

In Punjab and Haryana, the commission agents and farmers enjoy a relationship developed over the decades under the existing system of crop procurement.

On an average, at least 50-100 farmers are attached to each agent who takes care of farmers' financial loans and ensures procurement and prices for their crops.

Farmers are apprehensive that the new laws will do away with these agents and have them replaced by corporate houses that may not help them in their hour of need - for example, in cases not related to farming such as marriage in the family or house construction.

Inherent in this is the fear of the new and the uncertainties that inevitably come with any change.

A majority of the protesting farmers are from Punjab where the ruling Congress party and main opposition party Shiromani Akali Dal (SAD) have already shown their support to the farmers. According to a study by Punjab Agricultural University, there are more than 1.2 million farming families in Punjab and 28,000 registered commission agents.

A large part of Punjab's political economy relies on funds infused by federal and state-owned procurement agencies that buy a major portion of wheat and rice grown in the state.

In the 2019-2020 rabi crop season, Punjab supplied 129.1 lakh ( hundred thousand) tonnes of the 341.3 lakh tonnes' wheat procured for the federal government's pool.

A sizable number of the protesters are also from neighbouring Haryana state, ruled by BJP, where the party is in a catch-22 situation.

To enter Delhi, farmers from Punjab have to cross through Haryana but the state government has failed to prevent the swelling crowds of protesters coming to Delhi from Rajasthan and Punjab, the two states ruled by the Congress.

Had the BJP foiled the farmers' journey through its territory, it might have given rise to a serious law and order situation, something the saffron party can ill-afford.

A question that is often asked is why farmers in other Indian states are not hitting the streets in support of their colleagues in Punjab and Haryana.

There is no APMC Act in at least 15 Indian states, and nearly 18 states allow private markets and direct purchase from farmers by private corporate houses.

It is estimated, therefore, that the three farm laws are expected to make a difference only in some states and chiefly in respect of cereal crops and onion because most of the vegetables are already out of the purview of APMC markets.

In pushing through the farm laws, Narendra Modi's BJP government followed up on its economic agenda, which revolves around market economy, as vigorously as it pursued its political-ideological agenda of scrapping the special constitutional status of Kashmir and criminalising instant triple talaq as a step towards a uniform civil code.

According to the government, the idea behind the three laws is to liberalise the farm markets in the hope that doing so would make the whole system more efficient and allow farmers to get more options to sell their crops and thereby stand a chance to earn a more remunerative price.

India's progressive deregulation of the farm sector envisages a shift from input subsidies and procurement regimes like MSP to income support and facilitation of greater private investment in agriculture, which badly requires fund infusion particularly to build cold chain infrastructure and other forms of value addition and join the global food supply chain that remains insulated from disruptions like Covid-19.

This is also a foreign policy objective strongly advocated by the Modi government in its outreach to major countries like the US, Japan and Australia.

According to an official estimate, India's share in global food markets stands at 2.3 per cent. The efforts to make India a key link in the global food supply chain by becoming a major food exporter need a major investment in agriculture.

As the budget session of parliament progresses, the opposition is gearing up to corner the government on the issues of farm laws and the unrelenting protests by farmers at Delhi's borders.

And with many parties including regional outfits and some BJP allies - some of which have clout in rural areas - rallying behind the farmers, the government has its task cut out.

The RSS' call to the government to be sensitive in handling the farmers' agitation has drawn murmurs of discontent in a section of the BJP that feels that the issue could have been handled more tactfully.

One view is that since the government is ready to put the three laws on hold for one and a half years for facilitating more talks with the farmers' unions, this could have been done before the bills containing the laws were introduced in parliament last year, or that they could have been referred to a select committee once the objections were flagged, which would have weakened opposition to the laws.

On the other hand, the farmers would do well to show flexibility, an ingredient inherent in across-the-table negotiations, for any resolution to be reached.

Pallab Bhattacharya is a special correspondent for The Daily Star. The paper is a member of The Straits Times media partner Asia News Network, an alliance of 23 news media titles in the region.

 MYANMAR COUP UPDATE

Evidence shows oil industry flaring in Texas being done without permits

“Our state regulators—and our industry—has a long way to go to clean up our act.”

By

 Nick Cunningham

 -

February 1, 2021DeSmogBlog

Image Credit: Julie Dermansky/DeSmogBlog

In 2019 and 2020, the Environmental Defense Fund (EDF) conducted three helicopter surveys over the oil fields of West Texas. Flying over flare stacks at more than three hundred oil and gas drilling sites, EDF staff used infrared cameras to document unlit flares whose methane pollution is invisible to the naked eye. Their survey found that roughly 1 in 10 flares in the Permian basin were either unlit or malfunctioning. And a new report adds another layer onto this problem—whether the flares are even permitted in the first place.

The incidence of flaring natural gas, which is primarily methane, at drilling sites in the Permian basin skyrocketed in recent years as fracking proliferated and the industry drilled tens of thousands of wells. Burning natural gas at the wellhead would be wasteful enough, but some drillers simply release the gas into the atmosphere, a practice known as “venting.”

When a flare is unlit, it releases huge amounts of methane into the atmosphere rather than carbon dioxide, and methane is more than 80 times more potent as a greenhouse gas over a 20-year period. The EDF finding suggests that the climate pollution from the Permian basin was much worse than previously thought.

No Permit, No Problem?

The climate impact isn’t the only issue with the Permian’s flaring that has been flagged recently. Environmental watchdog group Earthworks looked at 45 drilling sites on state land that EDF surveyed. They cross-referenced those sites with a database published by the Texas Railroad Commission (RRC), which regulates the oil and gas industry and issues permits for flaring.

In a report released Thursday, January 28, Earthworks found that of the 45 surveyed sites, 34 of them — or 75 percent — did not even have flaring permits from the RRC. And eight of them were identified by EDF as having unlit or malfunctioning flares.

Oil companies are allowed to flare their methane gas for only 10 days after a well is drilled. They can receive waivers to flare for longer periods of time, but that is supposed to be only for exceptional circumstances. In practice, however, the RRC dishes out flaring permits far and wide. In 2019, the RRC issued 6,900 such permits, and never denied a single permit over the course of the multi-year drilling boom in the Permian basin.

In other words, while rampant flaring is commonplace, some companies are flaring without even obtaining the necessary permits. Worse, some of the flares aren’t lit, making their climate impact much higher.

The environmental groups were only able to sample a very small slice of drilling sites in the Permian basin, which has grown to become one of the largest producing oil fields in the world. Earthworks only looked at 45 sites on state land, but there are over 36,000 drill sites on state land in Texas, so the amount of unpermitted and unlit flaring is likely vastly higher than we know. The Texas General Land Office (GLO), which permits drilling on state land, did not respond to a request for comment.

Report: @earthworks 75% of #oilandgas flares on State Land could be unpermitted.
@txglo, @TCEQ, and @txrrc are allowing oil & gas companies to skirt the law at the expense of Texans’ health & climate. They must stop issuing new permits.https://t.co/81QtpR02K4 pic.twitter.com/SDd41qmABn

— TXsharon (@TXsharon) January 28, 2021

“The law requires flaring permits because the practice is wasteful and polluting, as Republicans and Democrats alike have agreed over the past few months,” Earthworks’ Senior Field Advocate, Sharon Wilson, said in a statement. “The oil and gas industry’s contempt for the law coupled with the GLO, TCEQ [Texas Commission on Environmental Quality] and [Texas Railroad Commission] failures to uphold it illustrates why permitting of new oil and gas operations must end.”

The scourge of flaring in the Permian basin has been known for years. In 2020, EDF estimated that methane escaping from oil and gas operations in the most productive part of the Permian basin was three times what the U.S. Environmental Protection Agency (EPA) estimates, although in the worst cases, individual sites leaked methane at 100 times the national average rate. 

“This report adds to a mounting pile of evidence that Texas’ flaring regulations — or lack thereof — are entirely inadequate,” Emma Pabst, an advocate with Environment Texas, said in a statement. “As we head into our state’s legislative session, we need lawmakers to know that when it comes to stopping routine flaring, inspections and enforcement are paramount to address the problem of climate change.” 

Turning down the tap on methane

The report comes at a time when the Biden administration is looking to tighten the screws on methane. In 2016, the Obama administration imposed federal methane regulations on oil and gas operations, including on pipelines. The Trump administration repealed those rules in 2020, and separately, a U.S. federal court struck down the same Obama-era rules. However, on January 20, as part of a slew of Day 1 executive orders, President Joe Biden directed the EPA to consider new methane regulations.

The oil industry itself has come around to the idea of federal regulation. For years, industry pushed for “voluntary” measures only, touting its own efforts to reduce methane emissions. It fought tooth and nail against regulation and applauded the Trump administration’s efforts to gut federal oversight.

But pressure has continued to increase as the climate crisis worsens, and not just from environmental groups. On at least two occasions in the last few months, deals to export American liquefied natural gas (LNG) to Europe fell through — one to Ireland and one to France — due to concerns about unregulated methane in the U.S.

The pressure is forcing a change of heart within the oil industry. One of the issues the American Petroleum Institute (API) said that it wanted to cooperate on with the Biden administration was federal methane regulations. In addition, a few oil majors voiced support for methane regulations last year ahead of the Trump rollback.

Investors are also advising regulation. “We view methane regulation, which has received support from many oil & gas corporates, as constructive for the industry’s ‘social license’ to operate,” Morgan Stanley wrote in a note to clients on January 28. The investment bank added that methane emissions from leaks, flaring, and venting are “avoidable without much incremental cost for public Energy companies.”

A recent report by industry analysts at Rystad Energy, on behalf of EDF, came to a similar conclusion. Rystad estimates that 40 percent of expected flaring could be zeroed out by 2025 at no cost. “A lot of this is avoidable,” Mike McCormick, a principal at Rystad, told Bloomberg.

It is worth noting that the industry’s word should not be taken at face value. API’s support for methane regulation came with the caveat that the industry “should be included in discussions to shape a regulatory regime that’s sensible,” which suggests it wants a particular outcome.

Meanwhile, BP, which has been outspoken about its energy transition ambitions, and has specifically supported federal methane regulation, is doing something quite different on the ground. Bloomberg reports that on January 26, BP went to the Texas RRC to obtain 121 flaring permits.

Even the RRC, which by all accounts has given the industry free rein over the past half-decade, expressed frustration.

“I am amenable to allowing fair time for flaring to occur in certain circumstances, but limits must be set,” Jim Wright, a Republican who joined the three-member commission in January, said in a statement. Instead of approving the permits, as has been customary in the past, the RRC decided to delay a decision until its next meeting.

While the RRC may begin to look a bit more closely at requests for flaring permits, the Earthworks report makes clear the scale of the issue — there are likely many more instances of flaring and venting than the RCC even knows about. As the report shows, Cyrus Reed of Sierra Club Lonestar chapter, said in a statement: “Our state regulators — and our industry – has a long way to go to clean up our act.”

UPDATE 01/29/2021: In an emailed statement to DeSmog, Andrew Keese, a spokesperson for the Texas RRC said: “The RRC’s commitment to further reducing flaring is reflected in actions commissioners took last November to revamp the application for exceptions.” Keese is referring to the RRC’s decision to require more information from companies that want flaring permits, and a vow to reduce allowed flaring times. Critics say the move didn’t go far enough.

Keese also pointed to the decline in flaring intensity. “The most recent RRC production data shows that in the last year and half, the percentage of natural gas flared compared to the natural gas produced in Texas dropped from a high of 2.3% in June 2019, to 0.77% in November 2020. During the same period, the volume of gas flared decreased by more than 71%,” Keese said. This, however, encompassed a period in which drilling activity collapsed due to the pandemic.

Loads of Coal Disinformation from the Kenney Government
How Alberta’s energy and environment ministers misled on open-pit mining plans.

Andrew Nikiforuk 25 Jan 2021 | TheTyee.ca
Tyee contributing editor Andrew Nikiforuk is an award-winning journalist whose books and articles focus on epidemics, the energy industry, nature and more.

Alberta Energy Minister Sonya Savage with Premier Jason Kenney at a 2019 press conference. Neither made a public appearance in the face of a public backlash against the government’s easing of coal mining. Photo by Jason Franson, the Canadian Press.


Last week Alberta’s government tried to hide political reality by issuing statements implying the “passion” of citizens had convinced it to back off its efforts to bring open-pit coal mining to a vast, ecologically-vital portion of the eastern slopes of the Rocky Mountains.

We’ve got a global crisis or two — or three — on our hands. Let’s take these solutions into 2021.

Apparently, Jason Kenney’s government hoped to administer an anesthetic so that Australian and Canadian mining companies could proceed with their carving away of mountaintops without public interference.

But the propaganda didn’t work. The pain is intense, and the howling only rises. Craig Snodgrass, the eloquent mayor of High River, noted on Facebook that “the announcement was another strategy by the government of Alberta and the coal industry only to try and whitewash over this scandal and calm the public.”

Last May the Kenney government rescinded the 44-year-old Coal Policy, which had it been in place would have prevented most of the proposed mines.* It killed the policy at the beginning of the pandemic on a late Friday afternoon with no public consultation.


Gone was the product of years of democratic consultation, a policy that recognized the eastern slopes create, guard, clean and secure mountain water as it brings life to the Canadian prairies, and so protected much of the eastern slopes of the Rocky Mountains from open-pit mining.

The Tyee has since August reported on the Coal Policy’s demise and the government’s courting of open-pit miners, but it took months for a groundswell of public opposition to form.

In recent weeks more than 100,000 Albertans from all political parties and all walks of life, including prominent singers from Corb Lund to Jann Arden, have demanded that the policy be reinstated.

In response to the outrage — what one academic called a “prairie fire” — the Kenney government hid from the public and turned on its propaganda machine.

Soothing words from the energy minister (who fights for coal in court)

Energy Minister Sonya Savage, who did not display the courage to face the press, began the B.S.-fest by releasing a brief statement at the very end of the day on Jan. 18 that referenced “the passion” of Albertans, and promised now to cancel 11 coal leases. It also said it would pause any future coal lease sales but provided no details.


The press release didn’t mention that the 11 leases — representing an insignificant 1,800 hectares — amounted to less than 0.2 per cent of the existing 420,000 hectares that the government had made available for open-pit mining in the eastern slopes.

So what Savage’s press release really told Albertans was this: “We’ll make a token gesture to appease your anger, but we are not going to change our policy and protect your water supplies. Our plans to mine the Rockies remain unchanged. We support Australian coal miners and will not consult with Albertans.”

At the same time that Savage released her misleading statement, a lawyer representing Savage’s ministry declared the government’s real intentions in court against an application by ranchers and First Nations seeking consultation and restoration of the Coal Policy.

“There’s no getting around the fact that the decision to rescind the Coal Policy may be seen as an unpopular one to some Albertans,” argued the lawyer, Melissa Burkett. “However, an unpopular decision is not an unlawful decision.”

Soothing words from the environment minister (who helps foreign coal miners)

Meanwhile Alberta Environment Minister Jason Nixon posted a three-page statement on Twitter saying he, too, had heard concerns from Albertans about coal mining in the eastern slopes.


The letter added that the killing of the Coal Policy had not changed the province’s environmental protections one iota, and that there would not be a mining “free for all” in the slopes.


Nixon began the letter by calling the eastern slopes “his backyard and your backyard.”

But David Luff, the former deputy environment minister who helped craft the Coal Policy, doesn’t think Nixon understands what the hell he is talking about.

“Indicating that his backyard is also the backyard of all Albertans implies that the minister is our neighbour. Good neighbours talk to one another and inform one another — particularly when one of the neighbours plans to remove the tops off all the mountains that are in our joint backyard.”

Nixon then tried to imply that no environmental standards were weakened by killing the Coal Policy: “Unfortunately there are a lot rumours and misinformation out there, including the notion that Alberta energy’s recission of the Coal Policy 1976 has opened up the Eastern Slopes for strip mining.”

Unfortunately, Nixon’s assertions don’t match the facts.

The Coal Policy, which placed restrictions on what could and could not be mined, protected Category 2 lands (1.5 million hectares) in the Rockies from open-pit mining. By abolishing that policy, the Kenney government has encouraged several Australian and Canadian firms with leases on Category 2 lands to explore and develop those lands.

That represents more than 800 square kilometres of the Rockies. At least a half a dozen firms, such as Montem, Atrum Coal, Benga Mining, Cabin Ridge and Valory Resources have proposed something unprecedented — more than half a dozen open-pit mines in watersheds where such activity was previously forbidden for nearly half a century.

Nixon’s disinformation is rebutted by the energy minister’s own statements. Sonya Savage has plainly characterized the Coal Policy as an obstacle to development.

Moreover, look who were alone in congratulating the Kenney government on killing the Coal Policy: Australian coal companies such as Atrum Coal, and the Coal Association of Canada, which happens to be directed by a former Alberta environment minister. Which in turn tells us something about how Alberta’s political powers define the loyalties of their environment ministers.

In his letter, Nixon tries to convince Albertans that the Coal Policy was old, outdated and ineffective. “Without question, the laws and policies that guide development today are stricter than those that existed in 1976.”

But that’s not true either. The Coal Policy required thorough environmental assessments just like today’s laws. It also required cost-benefit analyses — something new regulations don’t require. It discouraged bust and boom projects that left Alberta poorer. It also mandated royalties much higher than the one per cent now charged by the Kenney government.

When Kenney rescinded the Coal Policy, his government also gutted Directive 061, which contained 300 detailed pages on how companies must apply for and develop coal mines. The Kenney government replaced it with a 40-page manual fulfilling a promise to Australian coal miners to cut “red tape.”

Alberta Environment Minister Jason Nixon. Last week he said rescinding the Coal Policy won’t expedite coal mining, but the province’s energy minister flatly called it an obstacle to the same.

Whenever Australian companies have been asked why they’ve come to Alberta, they give three reasons: weak regulations, a one-per-cent royalty and a highly-supportive government such as Environment Minister Nixon. As The Tyee has reported, Nixon was eager to help foreign coal miners in their designs on Alberta even before the Coal Policy was erased.

He remains handy to their aims. Last summer, Atrum’s senior director Tony Mauro told a meeting of the Crowsnest Pass council that the company didn’t have a defined water source in southern Alberta where most watersheds are already over-allocated.

However, Nixon’s Environment Ministry was working on solving that, he explained, by “seeking to modify” a 20-year policy in order to free up more water from the Oldman River for “interested parties that may have an industrial purpose.”

Nixon now has the gall to imply in his letter that the Coal Policy was totally deficient because it didn’t address water quality standards or selenium.

But the Coal Policy wasn’t designed to do those things. By forbidding coal mining, it protected watersheds and kept the water clean and free of selenium pollution. The overall goal of the policy was to preserve water security, tourism and recreation in the eastern slopes. It was, after all, a Coal Policy, not a Water Management Policy.

Gavin Fitch, a lawyer representing landowners opposed to the Grassy Mountain Coal Project now under federal review, notes, “The management and protection of water quality under the Water Act and [the Environmental Protection and Enhancement Act] are separate from and independent of where open-pit coal mining is permitted.”

And Alberta is not doing a good job on that front. Data on selenium pollution from three coal mines in northern Alberta show selenium levels exceeding safe levels for fish by three to nine times.

But Nixon goes on. “Today we take a comprehensive approach to management of the environment so we understand the cumulative effects from all activities on the landscape.”

That’s not true either. It certainly never happened in the oilsands. Ten years ago, the province passed the Alberta Land Stewardship Act to provide for comprehensive regional planning. Only two of seven regional plans for the province were ever completed. How comprehensive is that?

The Elkview coal mine in BC operated by Teck Resources is similar to the open-pit and mountaintop removal approach slated for the eastern slopes of Alberta’s Rocky Mountains now that the Coal Policy has been rescinded by the Kenney government. Photo via the Teck Resources website.

Albertans might want to ask why Nixon didn’t insist that the Kenney government do a cumulative impact assessment on proposed coal mines in the eastern slopes before it killed the Coal Policy.

They might also want to ask where Alberta’s studies on the cumulative impacts of open-pit coal mines on water supply, quality and quantity are.

If the province was actually concerned about cumulative effects, why did the Joint Review Panel on the Grassy Mountain Coal Project in the Crowsnest Pass, headed by two Alberta Energy Regulator staffers, refuse to ask Benga Mining to account for the environmental effects of multiple mine proposals in the Oldman River watershed?

Nixon does not explain in his letter why publicly-paid experts on water, selenium and endangered species were not allowed to participate in that public hearing.

Near the end of the letter Nixon tries to assure Albertans that he “has placed restrictions on the most environmentally sensitive lands in former Coal Category 1 lands.” But these lands largely contain Banff and Jasper national parks as well as many provincial parks and have always been off limits to mining.

Even here, Nixon has not told the full truth. As David Luff notes, “The Coal Policy applied to both Crown coal rights and freehold coal rights. Nixon’s ministerial directive, issued on Sept. 9, 2020, protecting the former Category 1 lands, specifically states that private lands and freehold minerals are exempt from the directive restrictions. This means that the Government of Alberta, by policy, supports mountaintop removal mining of freehold coal rights in the former Category 1 lands, near national and provincial parks.

Nixon lastly assures Albertans they have nothing to worry about, because the Alberta Energy Regulator will review all coal projects. He implies that the regulator, which has been plagued by one scandal after another, is independent of government. (This is the same agency that allowed the oil industry to not reclaim its abandoned oil wells creating a multi-billion liability for taxpayers.)

But the regulator is not independent of industry, and that’s what matters. It has no mandate to protect the public interest and is funded entirely by industry. It recently hired Jason Kenney’s former campaign manager, an individual who describes himself as a “political activist.” How’s that for impartiality?

Environmental and regulatory lawyer Fitch adds this point:

“What Nixon does not say is that the [regulator]’s jurisdiction over coal projects is found in the Coal Conservation Act. One of the core purposes of the CCA is to ‘ensure the orderly, efficient and economic development of Alberta’s coal resources in the public interest.’”

In other words, the premise of the CCA is that development of coal is in the public interest. “So when the [regulator] holds a hearing (as it did, jointly with the federal government, for the Grassy Mountain project) for the purpose of determining whether a project is in the public interest, the starting point is that coal development, per se (i.e., before consideration of environmental issues), is in the public interest.”

In conclusion Nixon assures Albertans that he has a personal interest in ensuring that the eastern slopes are protected, “and I am directing my department to do everything in its power to do that.”

Nixon is certainly directing his department to do everything it can — for coal companies.

Katie Morrison, conservation director of the southern Alberta chapter of the Canadian Parks and Wilderness Society, notes that two Australian companies have asked for exemptions to rules that prevented them from operating during sensitive times for elk, sheep and grizzly bears. Nixon’s ministry granted those exemptions in two days.

In October 2019, Nixon sent a letter of support to Valory Resources, an Australian mining company. It had not yet been listed on the Australian stock exchange.

The minister said in the letter that he was pleased to hear that Valory Resources Inc. will be investing in Alberta and boasted of “efforts to streamline policy and processes to bring greater certainty and stability to our investment climate and make Alberta open for business.”

David Luff says that Nixon’s Twitter response to public outrage shows the government has no plan other than ignoring the best interests of Albertans:

“I am at a loss as to express how angry and upset Nixon’s letter makes me — the condescending tone, the egregious misrepresentation of the truth. Frankly, it’s quite disturbing,” said Luff. “If Premier Kenney wants to try and win back the trust of Albertans regarding the rescinding of the Coal Policy fiasco, he should remove Nixon from cabinet.”

Alberta’s Cancelled Coal Leases Called a ‘Trick’ READ MORE

The Australian Invasion: Big Coal’s Plans for Alberta READ MORE

Months Before Albertans Were Told, Australian Miners Knew Plans to Axe Coal Policy

Investor presentations signalled the Kenney government aimed to open protected lands to open-pit mining.

Andrew Nikiforuk 29 Jan 2021 | TheTyee.ca
Tyee contributing editor Andrew Nikiforuk is an award-winning journalist whose books and articles focus on epidemics, the energy industry, nature and more.

Documents show Australian firms seeking open-pit coal mining leases in Alberta got signals protections to sensitive lands would be lifted, clearing the way. The public only found out months later, the day the Coal Policy was rescinded. Photo: Shutterstock.

Australian mining firms seeking to strip-mine metallurgical coal in Alberta’s eastern slopes of the Rocky Mountains knew well ahead of Albertans that the government was planning to rescind a law that stood in the way.

The 44-year-old Coal Policy, the result of extensive public consultation in the 1970s, kept 1.5 million hectares of Category 2 lands in the eastern slopes off limits from open-pit mining until the Jason Kenney government abruptly axed it in May of last year with no public consultation.

Alberta’s environment minister has denied that doing away with the Coal Policy “has opened up the eastern slopes for strip-mining.”

But a presentation prepared some time in 2019 by Capital Investment Partners, a firm that owns four private coal companies with extensive leases in the central Rockies, told investors: “Alberta government [is] in the process of changing the coal policy to allow more open-pit mining.”

This statement raises serious questions, said Katie Morrison, the conservation director of the Southern Alberta arm of the Canadian Parks and Wilderness Society, who found the presentation online.

“The CIP presentation really implies that long before Albertans heard about the cancellation of the Coal Policy, the government was consulting with coal companies at the request of coal companies and for the benefit of coal companies,” Morrison told The Tyee.

She added that the presentation “is very clear that the Australians understood the cancellation as a lifting of restrictions that allowed them to mine in areas they couldn’t access before.”

In fact, Alberta Energy Minister Sonya Savage has contradicted Environment Minister Jason Nixon by stating the removal of the Coal Policy was justified because it was an obstacle to development.

But on Jan. 18 of this year, Savage issued a statement saying the UCP government had heard the “passion” of citizens opposed to the granting of coal leases and had cancelled some recent ones.

Critics noted Savage’s statement left unchanged the vast majority of coal leases in the eastern slopes that now can be mined because of the axing of the Coal Policy. A former Alberta civil servant called Savage’s statement a misleading “trick.”

The Kenney government has retreated into silence in the face of growing outrage with both Savage and Nixon refusing to take questions from the media.

Hundreds of thousands of Albertans from towns, cities and municipal districts have protested the killing of the Coal Policy because they view open-pit mining in the province’s critical watersheds as a threat to their communities, economies and livelihoods downstream.

Australian firm backs six mining plays in Alberta

CIP, an Australian firm that manages and raises capital for new coal mines, owns six private and public companies with leases covering 1,000 square kilometres in mostly formerly Category 2 lands just south of Nordegg, Alta.

Mining on those leases would impact the quantity and purity of the Ram River, the Clearwater River and their tributaries, which provide water for the City of Edmonton.

They include Phalanx Coal, Oros Coal, Mersey Coal and Ram Coal. Another CIP firm, Jameson Resources Ltd., owns leases in British Columbia and Alberta’s Crowsnest Pass on Crown Mountain.

Two of CIP’s companies, Oros Coal and Mersey Coal, registered as Alberta companies in March 2020, two months before Kenney cancelled the 44-year-old policy.


CIP has offices in Perth, Australia, and Vancouver, B.C.

The Tyee asked CIP executives Gavin Argyle and Rahul Goel what government ministry informed them of the killing of the Coal Policy and when they received that information but has received no reply.

A slide from a presentation dated 2019 by the Australian firm Capital Investment Partners touting its metallurgical coal mining plans in the eastern slopes of Alberta’s Rocky Mountains apparently predicts the Kenney government’s rescinding of the Coal Policy in May of 2020.

While CIP investors knew well in advance of the Coal Policy’s eventual fate, Albertans were kept in the dark until the Kenney government announced the rescinding on a Friday afternoon ahead of the May long weekend in the early days of the pandemic.

Records show lobbyists for coal interests pressed hard to have the Coal Policy lifted, but no other members of the Alberta public were consulted in arriving at the decision.

CIP has played an active and prominent role in sparking an Australian coking coal invasion in the Canadian Rockies.

The firm introduced Riversdale Resources, for example, to the Grassy Mountain Coal Project which it purchased for $28 million in 2013.

The company later sold out to Australian billionaire Gina Rinehart in 2019 for approximately $700 million. That project is now under joint federal review but is regarded by Australian miners as critical to opening up the entire region to industrial open-pit mining.

Australian firms flagged Coal Policy as barrier to open-pit mining

CIP-owned Ram Coal pointedly described the Coal Policy as a clear obstacle to development of its 20,000 leased hectares in the headwaters of the North Saskatchewan River in a 2017 technical brief.

“The RAM property is within lands subject to the restrictions of Category 2. The Policy, as originally written, laid out that while it is possible to conduct coal exploration in Category 2 land, there is strict control by Albertan authorities. Mine development is limited to underground mining only, and even then requires approval that the surface effects of mining will be environmentally acceptable.” The report said that Ram Coal circumvented the “strict control” by gaining an exemption from the NDP government.

Atrum Coal, a Perth-based company with 260-square-kilometre leases on entirely Category 2 lands in the southern Rockies, also portrayed the Coal Policy as an obstacle to its aims.

A September 2019 presentation on its Elan Hard Coking Coal project, just north of the Crowsnest Pass in the headwaters of the Oldman River, highlights “intensive government engagement to the minister level over the past 3 months.”

The presentation, which repeatedly described the Kenney government as “engaged and supportive,” also expressed hope their multi-mine proposal would get an exemption from the Coal Policy as did the Ram Coal Aries Project from the NDP government.

In a slide titled “Strong government support” the company also describes “Alberta regulators” as “engaged and supportive” of its exploration activities in the eastern slopes. Those operations have scarred mountains with access roads and drilling holes, in preparation for open-pit mining that in some cases removes the tops of mountains.

One month before the Kenney government erased the Coal Policy, an April 2020 investor presentation expressed strong confidence the policy was soon to end.

One slide entitled “permitting dynamics” noted that “Category 2 zoning under Alberta legislation” was a clear obstacle to development.

But it added help was on the way: “Regular, proactive engagement with Alberta government has significantly increased confidence of such an approval, potentially as early as this year.”

The slide added “the Coal Association of Canada is also actively engaging the Alberta government on this general issue.”

Mining company hailed lifting of Coal Policy

Atrum Coal had an inside view of the Coal Association of Canada lobbying against the Coal Policy in 2019 because Max Wang, the managing director and CEO of Atrum Coal also served as vice chair of the Coal Association of Canada.

Wang resigned from both jobs in May, the month the Coal Policy was rescinded, and now describes himself as an “ex-mining executive.”

When the Kenney government finally carried through on its secret signals it would kill the Coal Policy, Atrum Coal was the first to offer its congratulations, saying doing away with the protective measures “represented a significant step forward.”



The Australian Invasion: Big Coal’s Plans for Alberta  READ MORE

Atrum explained in a May 18, 2020 press release: “Under the existing policy, Category 2 designation refers to land that is generally considered not to be appropriate for open-pit coal mining. This meant that any open-pit permitting approval” for its 260-square-kilometre Elan project “would have required an exemption be granted.”

Now Atrum Coal didn’t need an exemption.

‘Pro-development and open for business’

Another company that immediately became economically viable as a result of the abolishment of the Coal Policy was Valory Resources, another Perth-based coal company.

In a 2019 presentation Valory noted that its proposed Blackstone Project occupied 14,500 hectares of Category 2 lands regulated by the Coal Policy in the headwaters of the North Saskatchewan River basin.

In a new 2021 presentation, in which Valory makes no mention of the Coal Policy, the company reveals that it “recently met with key Members of the Legislative Assembly of Alberta and received strong statements of support... which indicates that the Alberta provincial government are ‘pro-development and open for business.’” The company gathered those supportive statements into an appendix.

Valory expects to have a mine operating in the previously off-limits lands along the southeastern flank of the Rockies within 15 months.

The company’s presentation champions two letters of support from then-tourism minister Tanya Fir and Environment Minister Jason Nixon* both dated at the end of 2019.

Montem Resources, a Melbourne-based coal company, has also celebrated the killing of the Coal Policy.

It has plans for several multiple open-pit mines in the Crowsnest Pass including its 5,000 hectare Isola project near Atrum’s massive Elan project.



Alberta’s Cancelled Coal Leases Called a ‘Trick ’READ MORE

In a recent “exploration target summary” Montem notes, “All restrictions on issued coal leases within the former Coal Categories 2 and 3 have been removed, therefore the development status of [the] Isola [project] allows for both exploration and mining.”

On CBC radio Peter Doyle, the CEO of Montem, said mining would bring “prosperity” to the region but admitted that the “rollback of the ’76 Coal Policy has caused a flashpoint and that needs to be debated.”

In Australia the coal mining industry is a powerful and influential political force.

A 2019 investigative report found “A wide, well-funded network of lobbyists, supported by coal’s political and media allies, has been key to protecting the interests of coal companies operating in Australia. Individuals at the executive and staff level of these organizations regularly trade places, reinforcing the connections within a system that keeps coal at the centre of Australian politics, stifling energy sector reform and action on climate change.”

The rich, the poor and climate change

The environmental crisis is a great deal more serious, it is the challenge of the age and demands a coordinated global response.

By

 Graham Peebles

 -

January 30, 2021NationofChange

Image Credit: Getty Images

Only the most deluded denier can now question that the global climate is dramatically changing, and that the chaos is man-made. Extreme weather events—wildfires, drought, intense heat, hurricanes—are becoming more frequent, the impact on ecosystems and biodiversity, populations and infrastructure devastating. Fueled by the industrialized nations and the lifestyles of the rich, it is developing nations in the global south that are most severely impacted by climate change, with the poorest communities, particularly women and children, hit hardest.

The disruption to weather cycles is caused by global warming (increases in average surface temperature) which results from a buildup of what are commonly called greenhouse gases (GHG). Carbon dioxide (CO2), methane (CH4) and nitrous oxide (N2O), trap heat which would otherwise pass out of Earth’s atmosphere, resulting in a rise in average ground temperature. Burning fossil fuels (coal, natural gas and oil) is the primary source of emissions, as well as industrial animal agriculture, which is not only a major source of greenhouse gases, but is having a disastrous impact on the environment more broadly, including deforestation, and air and water pollution.

With 28% of the total, China (population c.1.4 billion) is the world’s biggest producer of GHG emissions, however when measured per capita it ranks only 47th. China is also one of the world’s biggest investors in renewable energy, and plans to produce 35% of its electricity from renewable sources by 2030. It is the USA (population c.328 million)—the second largest overall polluter—that has the highest per capita emissions in the world, and by some margin. Collectively the top four emitters (China, U.S., EU + UK and India) produced 55% of all GHG emissions in the last decade.

No matter where they are produced, GHG emissions effect everyone everywhere. Unsurprisingly the biggest single source, accounting for 73% of emissions is energy consumption from fossil fuels. A study by The Guardian in 2019, found that over a third of “all energy-related carbon dioxide and methane” emissions since 1965 have been produced by just 20 companies: Chevron, BP, Shell and Exxon top the carbon charts, producing over 10% of the world’s carbon emissions since 1965.

Everyone, particularly everyone in developed countries, contributes to the clogging fog of global emissions, but, in addition to the energy corporations, the group burning colossal pyres of fossil fuels and those who are therefore disproportionately responsible for climate change is the wealthy. Research by Oxfam and the Stockholm Environment Institute (SEI), published in September 2020, shows that between 1990 and 2015 (a critical period in the evolution of climate change) when GHG emissions grew by 60%, and cumulative emissions doubled, the richest 10% on the planet (c. 630 million) were responsible for a staggering 52% of the total. As if this isn’t shocking enough, drilling down on the figures reveals that the “richest one percent (c.63 million people)…were responsible for 15% of global emissions during this time.”

This huge increase in emissions depleted “the global 1.5C carbon budget [amount of CO2 the world/country has agreed it can produce to meet warming targets in a particular time period] by nearly a third in those 25 years alone.” In contrast the poorest 50% on the planet (c.3.1 billion people), all of whom live in developing countries, used just 4% of the available carbon budget, producing a mere 7% of cumulative emissions.

From growth to social justice

‘Carbon Inequality’ (differences in expenditure of the agreed carbon budget) reflects and amplifies the broader socio-economic imbalances in the world. In the 1990-2015 period global GDP doubled, wealth and income inequality grew, consumption levels increased, and although millions were raised out of the most dire levels of poverty ($1.90/day) the income of around half the worlds population remained at less than $5.50 a day.

Even when the poor see some paltry change in their lives, within the present paradigm the main beneficiaries of growth are always the rich; growth intensifies inequality, concentrating wealth, and with it political/corporate power, in the silk-lined pockets of a tiny percentage of the population: A diminishing few, mainly men, predominantly white, controlling more, consuming more, and greedily depleting the global ‘carbon budget’ at the expense of the rest of the population and future generations.

While the benefits of establishing a carbon budget are debatable, the fact that virtually all of it is eaten up by those responsible for the majority of GHG emissions is particularly unjust. Greenpeace relates that an average citizen (it’s much higher for the rich) in the U.S., Canada and Australia emit 150 times the amount of carbon compared to someone in Malawi in Southeast Africa. Adding injury and destruction to insult is the fact that poorer countries and communities, who have done little or nothing to cause climate change, are being most severely impacted by its devastating effects.

The breeding ground for climate injustice and social inequality is the competitive ideology inherent within the global socio-economic order, the values it promotes, the behavior it encourages. Endless consumerism and perpetual economic growth are essential components, but for GHG emissions to stop—not reduce, but stop altogether—this crude idea of development, which is a cornerstone of government policies and business plans around the world, must be rejected, and priority given to creating environmental responsibility, social justice and unity.

The challenge of the age

In December 2015, 194 countries signed up to the first-ever universal, legally binding global climate change agreement, adopted at the Paris climate conference (COP21). The treatise sets out a framework to limit global warming to “well below 2°C and pursuing efforts to limit it to 1.5°C.” To achieve this target countries have established nationally determined contributions (NDC), but even though some countries have announced headline-grabbing targets (EU to reduce GHG by 40% by 2030 e.g.), in its 2020 Emissions Gap Report, the UN states that not only are polices inconsistent with such figures, but that “countries must collectively increase their NDC ambitions threefold to get on track to a 2°C goal and more than fivefold to get on track to the 1.5°C goal.”

Currently, despite Covid-induced economic and trade restrictions in 2020, GHG emissions are climbing at an average rate of 1.3% per year. By the end of 2019, according to Oceanic and Atmospheric Research (NOAA), emissions had increased 41% since 1990. The resulting threat, to ecosystems, animal habitat and human communities, is huge; in a recent report in Frontiers in Conservation Science (FCS), an international group of scientists outline a “ghastly future of mass [animal] extinction, declining health and climate-disruption upheavals” because of collective ignorance and inaction, primarily by government and big business. “Future environmental conditions will be far more dangerous than currently believed,” they state, “the scale of the threats… is in fact so great that it is difficult to grasp for even well-informed experts.”

Scientists have been making such warnings for years, but politicians, business leaders, the rich and complacent have routinely ignored them, unprepared to make the necessary sacrifices and changes in approach and behavior required in order to save the planet. FCS make clear that dealing with the crisis requires fundamental changes to “global capitalism” as well as education and equality. Under the shadow of Covid-19 governments around the world acted, some more effectively than others, but all responded.

The environmental crisis is a great deal more serious, it is the challenge of the age and demands a (UN) coordinated global response. Radical action is needed and urgently, specifically action that brings about changes in behavior among the principle GHG emitters: The rich, the energy companies, big business and the consuming masses within developed nations. Environmentally responsible action by individuals, flying less, using less plastic, eating less animal produce, while important, will not deal with climate change. Systemic change is urgently needed, together with a shift in attitudes away from excess to sufficiency.

Graham Peebles

http://www.grahampeebles.org/

Graham Peebles is a freelance writer. You can contact him at grahampeebles[at]icloud.com