French arms firm busts sanctions to help Russia build weapons

Sat, June 4, 2022,


It was the BMD-4 with the Thales-made Catherine FC thermal imaging camera that took part in the shelling of Ukrainian civilian cars in Bucha.

I saw a post by volunteers on a social network, and together with my fellow lawyers we launched our own probe into the French manufacturer's involvement in Russia's military aggression against Ukraine.

Oleksandr Dubilet,

Chairman of the Board of CB "PrivatBank" (1997-2016), Financial and banking expert

So-called exemplary company

In France, Thales is not just a public company. There are three arguments to support this assertion.

1) The company specializes in the manufacture of systems for military, aerospace and maritime purposes

2) The company's shares are listed on the Paris Stock Exchange

3) It is not so much the private shareholder (the Dassault family with its 24.62% share) that is important, but the French government and its 25.67% share. Simply put, a company that is more than a quarter controlled by the French government, exports components that kill Ukrainians.

Thales

According to open sources, Thales supplied Catherine FC thermal imaging cameras to Russia, which were used to manufacture the Essa, Plissa and Sosna-U thermal sighting systems. They enhance the combat capabilities of modified Russian T-80, T-90, T-72 tanks and other military vehicles.

Conscious violators

After photo and video evidence of "fruitful" cooperation between Thales and Russia appeared on the Internet thanks to volunteers, my fellow lawyers and I have found real evidence that Thales supplied these combat components after the imposition of sanctions related to Russia's annexation of the Crimea.

Since this model of equipment was created in 2016, foreign manufacturers had to supply components at least a year earlier. Consequently, Thales sold military goods and technologies to Russia after the introduction of the first wave of sanctions (Council Regulation (EU) No. 833/2014 of July 31, 2014).

Catherine FC

Are these sanctions significant? Undoubtedly. In 2015, Thales failed to sign a $1.3 billion deal to supply two helicopter carriers to Russia. Instead, both ships were sold to Egypt.

I will also talk about a lesser-known episode of illegal but profitable cooperation between Thales and the aggressor state. The French company Sofradir, a subsidiary company of Thales, specializes in the manufacture of infrared detectors for military, space and commercial use.

According to NGO Disclose, in 2016, the company supplied 83 infrared detectors (S24) and 258 infrared detectors (S02) to Russia's CJSC TPK Linkos.

What is Linkos? According to the Arms of Russia information agency, Linkos specializes in the development and production of computers and communications equipment, optical, optical and electronic and microwave systems and complexes, night vision equipment and quantum electronics products.

In addition, Sofradir supplied 138 infrared detectors (S10) to JSC NPO GIPO, the Russian state institute of applied optics, which develops and manufactures optical and electronic systems. Since 2008, GIPO has been a part of the Rostekhnologii state corporation.

Mutually beneficial cooperation between this subsidiary of Thales and Russian military institutions is evidenced by two decisions (documents 1 and 2) of the 2016 Inter-ministerial Commission for the Study of Military Exports (CIEMMG) of France. According to the documents found by our team, French officials allowed Sofradir to supply military technology and goods despite the sanctions.

In 2019, Sofradir and Ulis merged and created a new company – Lynred. The well-known Thales is a 50% shareholder in Lynred.

The conclusion is simple: Sofradir actually misled the Inter-ministerial Commission by concluding an additional agreement "to fulfill the contract." The additional agreement extended the contract and aimed at circumventing sanctions for further supplies of military technology to Russia.

I and my colleagues found information that proves that Thales violated the sanctions in both the first (thermal imaging cameras) and the second (infrared detectors, through the subsidiary Sofradir) episodes, in the public domain (!). In my opinion, this illustrates the perception of sanctions very well. That is, the above French companies did not even bother to conceal evidence of their sanctions violations.

Demanding action

An EU Council decision bans the supply of dual-use goods and technology to Russia. However, you may be interested to know that this document has a loophole that reads as follows: the authorized state body may issue a license to supply such goods under contracts concluded before August 1, 2014.

And the French company Thales took full advantage of it, deliberately extending the old contracts through additional agreements and actually supplying military goods in 2015-2018.

My team of lawyers is working on each of two episodes of criminal cooperation between Thales and its subsidiary Sofradir with Russia. We have sent statements to the EU Council as the body that imposed the sanctions, as well as informing the law enforcement agencies, in particular, the French prosecutor's office. Our goal is to open criminal cases based on these statements.

Having revealed the corporate structure of Thales and identified the shareholders (in particular, the French government), we plan to address the shareholders of this company, French banks, secondary monitoring bodies and stock exchanges and demand that they take appropriate action against sanctions violators.

As in the case of our legal "hunt" for the Belgian company New Lachaussee, which supplied ammunition equipment for the Kalashnikov concern, the purpose of international lawsuits against Thales is to punish violators of sanctions and show the toxicity of any cooperation with the aggressor state.

At a time when Ukrainians are dying for European values, Europe must be completely on our side.

Japan sets new record, brings world closer to internet 100,000 times faster than current speeds



Jane Nam
Fri, June 3, 2022

The world is about to get a whole lot faster — 100,000 times faster to be exact, thanks to researchers in Japan who have set a new record for data transmission speeds.

The Network Research Institute at the National Institute of Information and Communications Technology (NICT) reported on May 30 that they had successfully demonstrated the world’s first transmission speed of 1.02 petabit per second in a multi-core fiber (MCF).

Petabit (PB) refers to the unit of data, and 1 PB is equivalent to 1,000,000 Gigabytes (GB). The new record could usher in new home internet speeds that are 100,000 times faster than any of the current fastest services on the market.

With this power, 1 petabit per second would mean 10 million channels of 8K broadcasting per second, making live coverage easily achievable from all corners of the world with virtually no lapse.

With 1.02 PB traveling over 32 miles per second, we could soon send 127,500 GB of data every second.

This was not the first time researchers have tested petabit speeds. During the Tokyo 2020 Olympic Games, technology giant Intel broadcasted live coverage of 19 days of the event to Brazil, Japan and Intel sites in the U.S. (by invitation only).

Global content technology strategist and 8K lead at Intel Ravindra “Ravi” Vehal claimed, “We are way beyond proof of concept.”

The newest record set by NICT is not only faster than previous attempts, it transmits data using a standard optic fiber cable, meaning it is technology that is potentially available for immediate and wide use.

For first time, uranium deposits found at 'impossible' depths by China

Robert Besser
4th June 2022, 


BEIJING, China: In what is being hailed a breakthrough for the country's national security, nuclear authorities in China have announced that their researchers have discovered rich uranium deposits deep below the Earth.

According to scientists involved in the project, large industrial-grade deposits were found at depths previously thought impossible to reach, increasing China's estimated total uranium reserve to more than two million tons.

This week, the China National Nuclear Corporation stated, "This world-leading project is a major breakthrough for our country."

With its nuclear power supply increasing faster than any country in the world, with seven or eight new reactors being built each year, China's demand for uranium has been increasing.

However, as most of China's uranium mines are small in scale and offer poor ore quality, more than 70 percent of its supply comes from countries, including Kazakhstan, Canada and Australia. This reliance on foreign sources is considered by Beijing to be a security risk.

Li Ziying, director of the Beijing Research Institute of Uranium Geology, said the discoveries challenged mainstream theories on uranium deposit formations, as it is generally believed that the deposits can only be found in shallow and geophysically stable areas.

However, some of the largest uranium deposits recently discovered in southern China are located at depths of more than 1,500 meters below the surface.

According to Chinese nuclear authorities, Li and his colleagues discovered that uranium could rise straight from the earth's mantle and become trapped in small "hotspots" several thousand meters below ground during massive tectonic collisions.

In an interview with Science and Technology Daily, Li said the difficulty was that there is usually only a small hint on the surface of deep uranium deposits, stating, "Locating it is as challenging as finding a compact disc over an area of 10,000-sq km."

Meanwhile, a Beijing-based researcher studying nuclear fuel, who asked to remain anonymous, said, "The discovery will not fully eliminate China's dependence on imported uranium because of the numerous cost and engineering challenges of extracting the deposits."

"But in the long term, it will likely have a profound impact on China's position in the global market," Li added.

Ukraine signs deal with Westinghouse to end Russian nuclear fuel needs

Fri, June 3, 2022, 

KYIV, June 3 (Reuters) - Ukraine has signed a deal for the U.S. nuclear power company Westinghouse to supply fuel to all of its atomic power stations in an effort to end the country's reliance on Russian supplies, Ukraine's state nuclear company said on Friday.

The agreement also increases the number of new nuclear units Westinghouse will build to nine from an earlier five, and the company will establish an engineering centre in the country.

Ukraine has four working nuclear power stations, the largest of which, in Zaporizhzhia, fell under Russian control days after the Russian invasion began in February but is still operated by Ukrainian technicians.

Building on earlier agreements, the deal with Westinghouse stipulates that the company will supply fuel to all of Ukraine's atomic plants.

Nuclear power covers around a half of all Ukrainian electricity needs and the energy minister said that in future Ukraine could also be a supplier of electricity to western Europe.

"We will modernise our fleet of nuclear power units, which will produce clean, safe and reliable energy without any Russian influence," Energy Minister Herman Halushchenko said, according to a statement by the state atomic energy company Energoatom.

Energoatom on Thursday denied a report that it might shut down the Zaporizhzhia plant if Kyiv loses control of operations at the site.

Ukraine has repeatedly raised safety concerns about the plant since Russia's invasion began on Feb. 24. On Friday, it warned that it was running out of spare parts. (Reporting by Natalia Zinets; writing by Matthias Williams; editing by Barbara Lewis)

Climate Change Is Fueling a 5,000-Square-Mile ‘Dead Zone’ in the Gulf of Mexico


Miriam Fauzia
Fri, June 3, 2022, 

Jeff Schmaltz (NASA Earth Observatory)

Global warming doesn’t just mean scorching temperatures and rising sea levels. It also means the death of oceans, lakes, rivers, and other bodies of water. Dead zones—areas in the water that are low on oxygen—are on the rise around the world due to a double-whammy of hotter temperatures and increased pollution, leading to the death of marine life and turning once vibrant habitats into hypoxic deserts.

Scientists have been monitoring one such dead zone in the Gulf of Mexico—considered the largest in U.S. waters—for over three decades. On June 2, the National Oceanic and Atmospheric Administration announced the Gulf of Mexico dead zone is expected to reach 5,364 square miles (or about eight times the size of the city of Houston) this year. This forecast is only a smidge lower than the five-year average of 5,380 square miles, and about 15 percent smaller than last year’s measurement. But it's still nowhere close to the federal-state target of 1,900 square miles set in 2001.

Dead zones are primarily created when runoff containing chemicals like nitrogen and phosphorus from agricultural practices, industrial activities, and population growth enter nearby waters and stimulate algae to grow like crazy. Overgrown algae sink and decompose and the decomposition process strips water of its oxygen, depriving marine life.

Climate change only worsens the situation since water holds less oxygen as it warms up, making it easier for dead zones to form. This is compounded by the fact that marine animals require more oxygen in warmer weather since they’re expending more energy.

The Gulf of Mexico’s dead zone is fueled by nutrient runoff from farms along the Mississippi River. The Interagency Mississippi River and Gulf of Mexico Hypoxia Task Force have been using NOAA’s hypoxia forecasts—based on computer modeling from five universities and one government agency—and the U.S. Geological Survey’s nutrient monitoring to set nutrient reduction targets across the Mississippi watershed states.

To confirm the forecasts and size of the dead zone, NOAA supports a monitoring survey each summer to incorporate any major coastal weather conditions that could impact a dead zone’s size and oxygen levels like hurricanes and tropical storms.

“The Gulf dead zone remains the largest hypoxic zone in United States waters, and we want to gain insights into its causes and impacts,” said Nicole LeBoeuf, assistant administrator of NOAA’s National Ocean Service, in a press release put out by the agency. “The modeling we do here is an important part of NOAA’s goal to protect, restore, and manage the use of coastal and ocean resources through ecosystem-based management.”

A second carbon sequestration pipeline, dubbed Heartland Greenway, could be coming to South Dakota



Alexandra Hardle, Aberdeen News
Fri, June 3, 2022, 4:45 AM·3 min read

As landowners continue to voice their concerns about Summit Carbon Solutions' proposed carbon sequestration pipeline, another such project is inching forward in progress.

Texas-based Navigator CO2 Ventures is also seeking to construct a carbon sequestration pipeline, dubbed the Heartland Greenway, through the region. That pipeline would run through South Dakota, Nebraska, Minnesota, Iowa and Illinois. It would collect carbon dioxide from several ethanol and fertilizer plants before pumping it underground to the Mount Simon Sandstone formation in central Illinois.
Tax credit sparks 'gold rush'

It's a part of what some have referred to as a new gold rush: because companies can currently qualify for what's known as the 45Q tax credit, investors are rushing to the region.

According to the company's website, its goal is to provide customers in the Midwest with “innovative carbon capture and storage solutions.”

In South Dakota, the pipeline would run through Moody, Minnehaha and Brookings counties. Construction is expected to begin in early 2024 should the project get approved.

Elizabeth Burns-Thompson, vice president of government and public affairs at Navigator, said the company is referring to the project as a carbon management platform as opposed to just a pipeline. That’s because the project consists of more than only the pipeline, with the capture equipment onsite at the ethanol and fertilizer plants being just as important.

Navigator has not applied for permits

The process is only just beginning for Navigator. The company has not yet applied for permits with each state’s Public Utilities Commission. That means the route is not yet set in stone. But Navigator has already signed contracts with several ethanol plants throughout the region as well as a fertilizer plant in Iowa.

In South Dakota, Navigator will partner with Valero, which has an ethanol plant in Aurora.

Navigator’s approach has been to hold public meetings before the company applies for the permits, said Burns-Thompson. At the meetings, which were held in December and January, everything from compensation to the structure and effects of the project were discussed, she said.

No easements yet, company says

Navigator has not yet begun to hand out easements to landowners as feedback still being collected, said Burns-Thompson. But landowners might have had contact with Navigator’s land team, which has been surveying property since the meetings in December and January.

While eminent domain has been a large topic of conversation regarding the Midwest Carbon Express, Burns-Thompson said that Navigator will be creating secondary routes with the goal of getting all voluntary easements. But, she added, the structure must be continuous and that there is only so much shifting that can be done.

Pipeline would be funded through private equity

There’s one thing that sets Navigator apart from Summit Carbon Solutions: money. While Summit will be profiting from the 45Q tax credit as well as splitting profits with ethanol plants, Navigator is going about profiting a bit differently.

Navigator is funded entirely through private equity, said Burns-Thompson. That has allowed the company to sign long-term contracts with participating plants. Each plant agrees to a certain amount of carbon dioxide that will be transported over a set number of years, with many contracts being for 20 years. The rate is set in that contract, allowing the ethanol and fertilizer plants to maintain ownership of the CO2, she said.

That allows the plants to benefit from the 45Q tax credit, said Burns-Thompson. And because their carbon emissions will be down, that company can then sell their product at a premium in states that have low-carbon fuel standards, including California and Oregon, she said.

This article originally appeared on Aberdeen News: Here's what to to know about the Heartland Greenway pipeline

World's fastest carbon dioxide collector heralds new era for direct air capture



Tokyo (Japan), May 30 (ANI): Tokyo Metropolitan University researchers have developed a novel carbon capture system that extracts carbon dioxide straight from the environment with unparalleled efficiency. Isophorone diamine (IPDA) was reported to remove carbon dioxide at low concentrations in the environment with 99 per cent efficiency in a "liquid-solid phase separation" system. The compound is reusable, requires little heating, and is at least twice as quick as previous devices, making it an exciting new development for direct air collection.

The research was published in the journal, 'ACS Environmental Au'.

The devastating effects of climate change are being felt around the world, with an urgent need for new policies, lifestyles and technologies that will lead to reduced carbon emissions. However, many scientists are looking further ahead than a net-zero emission goal, to a future "beyond zero" where we can actively reduce the amount of carbon dioxide in the atmosphere. The field of carbon capture, the removal and subsequent storage or conversion of carbon dioxide, is developing rapidly, but hurdles remain before it can be deployed at scale.

The biggest challenges come from efficiency, particularly in processing atmospheric air directly in so-called direct air capture (DAC) systems. The concentrations of carbon dioxide are such that chemical reactions with sorbents are very slow. There is also the difficulty of getting the carbon dioxide out again in more sustainable capture-and-desorption cycles, which can be very energy-intensive in itself. Even leading efforts to build DAC plants, such as those using potassium hydroxide and calcium hydroxide, suffer serious efficiency issues and recovery costs, making the hunt for new processes notably urgent.

A team led by Professor Seiji Yamazoe of Tokyo Metropolitan University has been studying a class of DAC technology known as liquid-solid phase separation systems. Many DAC systems involve bubbling air through a liquid, with a chemical reaction occurring between the liquid and carbon dioxide. As the reaction proceeds, more of the reaction product accumulates in the liquid; this makes subsequent reactions slower and slower. Liquid-solid phase separation systems offer an elegant solution, where the reaction product is insoluble and comes out of the solution as a solid. There is no accumulation of the product in the liquid, and the reaction speed does not slow down much.

The team focused their attention on liquid amine compounds, modifying their structure to optimize reaction speed and efficiency with a wide range of concentrations of carbon dioxide in the air, from around 400ppm to up to 30%. They found that an aqueous solution of one of these compounds, isophorone diamine (IPDA), could convert 99% of the carbon dioxide contained in the air to a solid carbamic acid precipitate. Crucially, they demonstrated that the solid dispersed in solution only required heating to 60 degrees Celsius to completelyrelease the captured carbon dioxide, recovering the original liquid. The rate at which carbon dioxide could be removed was at least twice as fast as that of the leading DAC lab systems, making it the fastest carbon dioxide capture system in the world at present for processing low concentration carbon dioxide in the air (400ppm).

The team's new technology promises unprecedented performance and robustness in DAC systems, with wide implications for carbon capture systems deployed at scale. Beyond improving their system further, their vision of a "beyond zero" world now turns to how the captured carbon may be effectively used, in industrial applications and household products.

This work was supported by Project Number P14004 of the New Energy and Industrial Technology Development Organization (NEDO). (ANI)

ExxonMobil Sees a $4 Trillion Opportunity to Make Oil Cleaner

By Matthew DiLallo - Jun 4, 2022 - MOTLEY FOOL

KEY POINTS
Exxon sees an enormous market opportunity for carbon capture and storage.

That's leading the oil giant to invest billions of dollars into the market.

It's one of several energy companies working on carbon capture and storage solutions.

The oil giant is pumping billions of dollars into a plan to clean up the oil patch's emissions profile.

ExxonMobil (XOM 1.45%) doesn't believe fossil fuels will become extinct. It sees oil and gas playing a vital role in fueling the economy in the future, even as the adoption of cleaner alternatives accelerates. That's partly due to their lower relative costs and the huge technological leaps needed before replacement fuels like green hydrogen become commercially viable.

Another reason Exxon sees a future for fossil fuels is that it can lower its carbon emissions profile through carbon capture and storage. The oil giant foresees a $4 trillion market opportunity by 2050 for cleaning up the oil patch.

What is carbon capture and storage?

Carbon capture pulls carbon dioxide emissions from fuel combustion and industrial processes out of the air so that it doesn't get into the atmosphere and negatively impact the climate. The captured carbon dioxide then moves on pipelines or ships to underground geological formations for storage. There's also the potential to reuse captured carbon dioxide for other purposes.

One potentially major market for captured carbon dioxide is a process known as enhanced oil recovery (EOR). Oil companies, including Exxon, Occidental Petroleum (OXY 1.43%), Denbury Resources, and Kinder Morgan, pump carbon dioxide into legacy oil formations to increase pressure, resulting in higher production. Many of these companies currently use carbon dioxide produced from underground reservoirs for EOR. However, they're increasingly seeking out captured carbon for EOR purposes.

In addition to EOR, potential uses of captured carbon include manufacturing other fuels like synthetic jet fuel and making building materials like concrete.

Betting big on carbon capture and storage

While carbon dioxide has a range of potential uses, the initial focus of Exxon and others in the energy sector is on sequestering it underground. The company is investing more than $15 billion over the next six years to lower greenhouse gas emissions through carbon capture and storage, hydrogen, and biofuels. It's already the world leader in carbon capture, pulling more carbon dioxide out of the air than any other company.

However, it has grand ambitions to build an even larger carbon capture and storage business. For example, Exxon is working on an up to $100 billion plan to capture carbon produced by petrochemical plants, power generating facilities, and other heavy industries along the Houston Ship Channel. The plan would see industrial facilities install devices to capture carbon dioxide before it leaves their plants. They could either use it to develop products or transport it via pipelines to the Gulf of Mexico, where it will get injected into sub-sea formations.

Exxon is also looking into developing a large-scale carbon capture and storage hub in Australia. It would capture emissions produced by industries in the Gippsland Basin and transport the carbon dioxide to a depleted oilfield off the country's coast via existing pipelines.

Growing interest in capturing carbon

Exxon is one of many energy companies working on developing carbon capture and storage projects. EnLink Midstream (ENLC -0.09%) and Talos Energy (TALO 3.19%) are working to jointly develop a complete carbon capture, transportation, and sequestration solution for industrial-scale carbon dioxide emitters along the Mississippi River. The proposed project would use significant portions of EnLink's pipelines in the region to transport captured carbon dioxide and move it to Talos' River Bend sequestration site in Louisiana.

Meanwhile, EnLink and Enterprise Products Partners (EPD -0.14%) are working with a subsidiary of Occidental Petroleum on potential carbon capture and storage solutions. EnLink's project with Occidental would focus on another section of the Mississippi River corridor, while Enterprise Products Partners is working on developing a project along the Houston Ship Channel. The midstream companies would provide existing and new pipelines to transport captured carbon to sequestration hubs operated by Occidental Petroleum.

Carbon capture could keep the oil patch from going extinct

ExxonMobil believes carbon capture and storage is an answer to the world's energy problem. It can make fossil fuels much cleaner while keeping the costs low compared to alternative fuels. That's leading the oil giant to bet big on the future of carbon capture. If it's correct, that wager could pay big dividends by enabling it to continue producing oil and gas while earning meaningful income from carbon capture and storage.

WHY GAS PRICES ARE HIGH
US May Never Build New Refinery Even With Surging Gas Prices, Chevron CEO Says

Kevin Crowley and Alix Steel
Fri, June 3, 2022, 

(Bloomberg) -- There may never be a new refinery built in the US despite surging gasoline prices as policymakers move away from fossil fuels, according to Chevron Corp.

“We haven’t had a refinery built in the United States since the 1970s,” Chief Executive Officer Mike Wirth said in an interview on Bloomberg TV. “My personal view is there will never be another new refinery built in the United States.”

The Biden administration has appealed to OPEC and the US shale producers to pump more crude to help lower gasoline prices this year. But even if oil prices were to fall, the US may not have enough refining capacity to the meet petroleum product demand. Refining margins have exploded to historically high levels in recent weeks amid lower product supplies from Russia and China and surging demand for gasoline and diesel.

And adding refining capacity is not easy, especially in the current environment, Wirth said.

“You’re looking at committing capital 10 years out, that will need decades to offer a return for shareholders, in a policy environment where governments around the world are saying: we don’t want these products,” he said. “We’re receiving mixed signals in these policy discussions.”

US retail gasoline prices averaged $4.76 a gallon today, a record high and up 45% this year, according to AAA. East Coast stockpiles of diesel and gasoline inventories in the New York-region are at their lowest levels for this time of year since the early 1990s, raising the specter of fuel rationing, just as the US enters summer driving season. Even with high prices, Wirth is seeing no signs of consumers pulling back.

“We’re still seeing real strength in demand” despite international air travel and Chinese consumption not yet back to their pre-pandemic levels, Wirth said. “Demand in our industry tends to move faster than supply in both directions. We saw that in 2020 and we’re seeing that today.”

Chevron couldn’t instantly increase production today even if it wanted to due to the considerable lead times in bringing on oil and gas wells, even in the short-cycle US shale, Wirth said. The CEO expects to meet with the Biden administration when he’s in Washington next week.

“We need to sit down and have an honest conversation, a pragmatic and balanced conversation about the relationship between energy and economic prosperity, national security, and environmental protection,” Wirth said. “We need to recognize that all of those matter.”

Chevron's CEO Says No More U.S. Oil Refineries. What Should Energy Investors Do?

By Matthew DiLallo - 

The Motley Fool

KEY POINTS

Chevron's CEO doesn't believe the U.S. will ever build another new refinery.

That could impact the industry's ability to meet demand for refined products in the future.

It also suggests that refining margins could remain strong.

There's no quick way to ease America's pain at the pump.


Mike Wirth, the CEO of oil giant Chevron (CVX -0.43%), says he doesn't believe there will ever be another new oil refinery built in the U.S. He made that comment during a recent interview with Bloomberg TV discussing what the country can do to ease record prices at the pump. Even if oil producers like Chevron increased their production, there's not enough refining capacity to meet the demand for petroleum products like gasoline, jet fuel, and diesel. That means prices will remain elevated even if oil companies pump more crude oil.

While that's bad news for consumers, it's good news for refiners. It suggests refining margins will stay strong. That could give refining stocks the fuel to continue producing strong results.


IMAGE SOURCE: GETTY IMAGES.
No quick fix for high gas prices

According to AAA, the average U.S. retail gasoline price is currently around $4.75 per gallon. That's a record high and 45% above last year's level. Unfortunately, there's no easy solution to address high gas prices. While elevated oil prices contribute to the surge in gasoline prices, it isn't the only factor.

Another issue is that refining margins have surged in recent weeks. That's due to lower refined product supplies from Russia and China and red-hot demand for those products, even though international air travel and Chinese consumption aren't yet back to their pre-pandemic levels. Those higher margins have a big impact on the price paid at the pump because refining is the second-largest input cost:


IMAGE SOURCE: EIA.

As refining margins rise, changes in oil prices have less influence on prices paid at the pump.

Because of that, even if Chevron and other oil companies increased their crude oil production -- and that's easier said than done -- it wouldn't put as much of a dent in gasoline prices as consumers might hope. The industry can't quickly add new refining capacity.

In Wirth's view, the U.S. won't ever build another refinery. That's because it's impractical for an energy company to consider building a refinery due to the current environment. Wirth said, "You're looking at committing capital 10 years out, that will need decades to offer a return for shareholders, in a policy environment where governments around the world are saying, 'We don't want these products to be used in the future.'" So even if a company like Chevron was willing to commit the time and capital to build a refinery, it doesn't make sense given the shift toward cleaner alternative energy.

A great time to be a refiner

With demand for refined products strong, and no new capacity coming down the pipeline, refining companies are in an enviable spot these days. That was certainly the case for Chevron's U.S. downstream business in the first quarter. The company reported $486 million of earnings, reversing a $130 million year-ago loss. Chevron cashed in on higher demand by increasing its refinery run to capitalize on higher margins for refined products.

Meanwhile, energy companies focused on refining made even more money. For example, leading independent refiner Marathon Petroleum (MPC 3.57%) generated $1.4 billion in adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) from refining and marketing in the first quarter. That's up from a mere $23 million in the year-ago period. Marathon benefited from higher margins -- $15.31 per barrel in the first quarter of 2022 versus $10.16 per barrel in the prior-year period -- and higher utilization (Marathon used 91% of its available capacity, compared to 83% in the first quarter of 2021).

Fellow independent refiner Valero (VLO 2.42%) also cashed in on improving conditions in the refining market during the first quarter. It tallied $1.47 billion of adjusted operating income, a significant improvement from an adjusted loss of $506 million in the year-ago period.

With refining margins only improving in recent weeks, and refiners operating closer to max capacity, the industry appears poised to produce an even bigger earnings gusher in the coming quarters. Most of that windfall will go toward enriching investors via higher dividends and share repurchases since refiners aren't spending capital on increasing their traditional refining capacity. Instead, most refiners have already shifted their focus to the fuels of the future. For example, Marathon recently formed a joint venture to build a $2 billion renewable fuels project, while Valero is accelerating the expansion of its Diamond Green Diesel project to finish it by the fourth quarter of this year.
How to invest in the refining boom

The U.S. hasn't built a new refinery in decades. Given the current environment, it likely won't build another one anytime soon, if ever again. Because of that, there's no quick solution to the industry's capacity issues.

That suggests refiners should continue to thrive in the near term. While Chevon will be one of the beneficiaries of these market conditions, refining is a small part of its operations. Because of that, investors looking to cash in on the current refining boom might want to consider pure-play refiners like Valero or Marathon over an integrated oil giant like Chevron. They'd have more upside potential if refining margins remain strong.

‘Disgusting’ behaviour at Canadian police undercover training course sparks inquiry

Tracey Lindeman in Ottawa

THE GUARDIAN
Fri, June 3, 2022


Policing experts in Canada have called for an overhaul of undercover tactics after reports that officers at a training session participated in “disgusting, appalling” behaviour, including penetrating a colleague using a vegetable, defecating on another and exposing genitalia.

According to Global News and CTV, the BC Municipal Undercover Program was abruptly shut down after the workshop in May, which included a role-playing exercise in which some participants went to “extreme lengths” to prove they were not officers.

Several participants were so disturbed by the incident that they reported it to their superiors, and nine officers are reportedly under investigation.

British Columbia’s solicitor general, Mike Farnworth, described the allegations as “disgusting” and “appalling” and authorities in the province have said that an independent investigation will be launched.

Experts said that the incident underlined the need for clear guidelines to undercover operations and external oversight of policing tactics.

“If these allegations are correct, then obviously some of these officers thought things were appropriate that are manifestly inappropriate,” said Kent Roach, a professor of law at the University of Toronto and the author of several books including Canadian Policing: Why and How It Must Change.

Roach also expressed concerns over the liberal use of deceptive and even violent tactics which Canadian police are allowed to use in undercover operations.

“Part of the problem is we too often leave the police to govern themselves, subject to the odd court decision,” he said.

In recent years, criticism has focused on Canada’s frequent use of a tactic known as the “Mr Big” technique, used when police suspect a person has committed a serious crime, but cannot prove it due to a lack of evidence.

The technique involves recruiting the suspect into a fake criminal organisation in which they are encouraged to perform risky and sometimes illegal activities as ways of “proving” themselves worthy.

The end goal of the exercise is to have them meet the gang’s “boss” and confess to the worst thing they have ever done.

Such tactics are banned in many other countries, but have been used in hundreds of Canadian police investigations since it was first developed in the early 1990s.

Mr Big operations are typically expensive investigations that do not have to follow any specific rules beyond regular police codes of ethics and procedures. They can be used by any police force in Canada, and police do not have to disclose whether the operations yield successful convictions, nor how much they cost.

This week, a northern Alberta jury acquitted a man of murder – instead, convicting him of a lesser charge of manslaughter – in the death of Gloria Gladue, after a protracted Mr Big operation.

Michael Kempa, an associate professor of criminology at the University of Ottawa, said that there are not even rules about recording confessions made during Mr Big operations – meaning suspects can end up being prosecuted on undercover officers’ word alone.

Kempa called for the federal government to set clear national rules on how such investigations should be conducted and which crimes they can be used to investigate. “At the moment, we leave it to the courts, so it’s post-hoc accountability,” he said.

Guidelines should also consider a suspect’s vulnerability of making false confessions, said Roach, pointing to a 2013 case in which a BC couple targeted in a Mr Big operation were pushed into creating a plan to plant pressure-cooker bombs at Canada Day festivities.

“That was a Mr Big done against two recovering heroin addicts,” he said. “So I think one of the things the policy would do is you don’t target people who are especially vulnerable to giving false confessions.”

SINCE THE SIXTIES THE RCMP HAVE USED UNDERCOVER COPS TO INFILTRATE THE LEFT AND PROMOT VIOLENCE, THIS CONTINUED RIGHT UP TILL RECENTLY WITH INFILTRATION OFAN  ANARCHIST GROUP DURING THE G20 PROTESTS, OFFERING TO SUPPLY THEM WITH BOMBS AND WEAPONS TO BE A 'BLACK BLOC' THE GROUP WAS SUBSEQUENTLY ARRESTED BY THE SAME COPS

He said municipal leaders could listen to repeated calls from civilians and experts to use their positions to implement more democratic control of the police – such as electing police leaders, as well as setting policing priorities that weigh the value of undercover operations.

“I’m skeptical, but I also think that that’s an issue that needs to be democratically resolved,” said Roach.