Page 8 - NorthAmOil Week 26 2021

NorthAmOil PIPELINES & TRANSPORT NorthAmOil

Supreme Court sides with PennEast

Pipeline on land acquisition

US NORTHEAST THE US Supreme Court has ruled that federally northern Pennsylvania to New Jersey. The pro-
approved gas pipeline projects can seize state- ject, which is being developed by a consortium
owned land required for national infrastructure. of five companies, still needs to secure state-level
The ruling came in the case of PennEast Pipe- permits, but given New Jersey’s opposition, this
line vs the State of New Jersey, and provided a could prove challenging.
boost to PennEast’s planned 116-mile (187-km) Indeed, a Bloomberg Intelligence analyst,
gas pipeline project, which is set to pass through Brandon Barnes, was quoted as saying the pro-
Pennsylvania and New Jersey. ject still had “low odds”. This is despite the deci-
The 5-4 ruling, issued on June 29, asserted sion being “certainly a material win for pipes
federal power to acquire land for national infra- generally”, as gas projects could potentially face
structure projects, while New Jersey’s argument similar obstacles in the future. Nonetheless,
that sovereign immunity shielded the state from Bloomberg cited Barnes as saying the ruling was
being taken to court by PennEast was rejected. hardly a game-changer for pipelines because
The ruling received cross-party support among there are many ways they can still be delayed,
the judges, with both Democrat and Republican or cancelled outright. “At least pipelines can
judges also dissenting. still count on being able to use eminent domain
Both the administrations of former US Pres- to acquire the land rights necessary to build a
ident Donald Trump and current President Joe pipeline no matter which state they are going
Biden have supported PennEast. However, 19 through,” he said.
states had urged the Supreme Court to rule the A separate legal challenge involving New Jer-
other way and side with New Jersey in the case. sey is pending in a federal appeals court in Wash-
The PennEast pipeline would carry up to 1bn ington, DC, so the litigation over PennEast is not
cubic feet (28.3mn cubic metres) per day from over yet.™

INVESTMENT

ConocoPhillips cuts capex

despite oil price increase

US CONOCOPHILLIPS, the US’ largest independ- repurchases for the year by $1bn, bringing its
ent oil producer, has reduced its capital expend- total planned distributions for the year to around
iture guidance for 2021 by $200mn to $5.3bn $6bn, or 7% of current market capitalisation.
from $5.5bn previously. The cut comes despite This is in line with the company’s pledge to return
higher crude prices, which are up 45% since 30% of cash from operations to shareholders.
the start of 2021 and strengthened further still ConocoPhillips also said it hoped to sell
on July 1 as OPEC+ met to discuss a proposed $2-3bn of assets by the end of 2022.
reduction in its supply cuts. “We believe we’re entering a constructive
The company also said in a June 30 inves- environment for the business, but we also rec-
tor update that it expected its adjusted operat- ognise that we’re in a period of evolving energy
ing costs to be $100mn lower at $6.1bn, citing transition,” stated ConocoPhillips’ chairman and
“stronger-than-projected business execution”. CEO, Ryan Lance. “ConocoPhillips is meeting
Beyond this year, ConocoPhillips said it this moment with a very compelling plan that
anticipated its capex to average about $7bn per is resilient and durable, but also flexible. We
year over the next 10 years, with about 3% com- can and will adapt as the future plays out, all
pounded annual production growth. while remaining focused on delivering superior
Additionally, the company announced that returns to shareholders through cycles,” he said.
it had increased its expected savings from its “We have embraced a new imperative for the
$10bn acquisition of Permian Basin-focused business that we call the Triple Mandate,” Lance
Concho Resources, which closed in January. continued. “We want to play a valued role in
ConocoPhillips now anticipates synergies and whatever pathway the energy transition takes by
savings related to the acquisition to reach $1bn investing in the lowest cost of supply barrels, deliv-
per year. ering competitive returns of and on capital, and
The producer is also raising its planned share achieving our net-zero emissions ambition.”™

P8 www. NEWSBASE .com Week 26 01•July•2021