Welcome to Net Zero, your daily industry brief on clean energy and Canadian-resource politics.
The Alberta Securities Commission (ASC) finished its hearings of the hostile takeover of Calgary-based Inter Pipeline Ltd. on Friday. The battle for Inter Pipeline began in February, when Brookfield Infrastructure Partners LP bid on the Inter Pipeline after its stock plunged. Pembina Pipeline Corp. later stepped in with an offer in June.
Lawyers for Brookfield argued that Inter Pipeline “unfairly favoured Pembina by agreeing to pay it ($350 million)” if Pembina’s takeover fell through.
On the other side, Inter Pipeline charged that Brookfield’s offer was “misleading and deterred other parties from bidding.” Specifically, it said Brookfield added its common shares to a type of securities called total return swaps to result in an ownership stake in Inter Pipeline that represents “nearly 20 per cent voting control in the company.”
However, Brookfield has only a 9.75 per cent stake in common shares and a 9.9 per cent economic interest through its total return swaps with the Bank of Montreal.
Lawyers representing Inter Pipeline added that “the ($350 million) break fee was within typical range,” and said the fact that BMO would be paid a $15-million success fee if Brookfield’s bid was chosen over Pembina’s “creates a conflict of interest,” because it makes the bid more attractive to BMO, which has a shareholder vote in Inter Pipeline.
If ASC decides the fee is valid, and Brookfield’s bid is favoured over Pembina’s, Brookfield will have to pay the $350-million break fee. The ASC is expected to deliver its verdict on Monday. The Globe and Mail has more.
According to a new study published by researchers at three schools — Harvard University, the Georgia Institute of Technology, and Syracuse University — a clean-energy standard would have been “most effective” at reaching the American goal of “80 per cent renewable energy use by 2030.”
A clean-energy standard was initially proposed in U.S. President Joe Biden’s sweeping infrastructure bill, but was ultimately omitted after negotiations. A clean-energy standard would have scaled up renewable energy throughout the U.S., using “a system of incentives and penalties.” The Guardian has more.
In other news, India says it won’t be able to commit to net-zero emissions without financial help from richer countries, writes Bloomberg News.
“Every policy decision has a cost to the economy,” Environment Secretary Rameshwar Prasad Gupta said from New Delhi. “Going net-zero or using less carbon also has a cost. We are not anti-net-zero, but without adequate climate finance being definitively available, we can’t commit (to it).”
Still with net-zero emissions, the U.K. needs “tougher policies to make residential heating more efficient,” according to a report from the National Grid Electricity System Operator (ESO).
“Consumers will need a greater understanding of how their power use and lifestyle choices impact how sustainable our energy system will be,” said Matthew Wright, head of strategy and regulation at National Grid ESO. “Government policy will be key to driving awareness and change.” Reuters has the story.
Finally, South Korea’s state energy firm, Korea Gas Corp., will buy two million tonnes of liquefied natural gas (LNG) a year from Qatar’s state oil company, Quatar Petroleum, starting in 2025.
“This long-term contract is considered to have favourable contract conditions, which would help stabilize LNG supply, as well as to significantly drop fees,” South Korea’s energy ministry said in a statement. Reuters also has this story.
On Monday morning at 9:44 a.m., West Texas Intermediate was trading at US$73.64 and Brent Crude was going for US$74.72.
On Saturday, Nova Scotia Premier Iain Rankin announced a request for proposals for ways “to supply 10 per cent of the province’s electricity from renewables,” or about 350 megawatts’ worth.
“This is about doing what’s right for ratepayers and keeping electricity affordable,” Rankin said. “It also ensures we mitigate risks for ratepayers, and establish an energy sector that attracts business.” The province’s news release is here, while CBC News also covered the story.
Moving to the West, Atco Energy Solutions, an energy infrastructure company in Calgary, announced it will build a new facility in Vegreville, Alta., to transform agricultural manure and other organic waste into natural gas, the Canadian Press reports.
“There (are only two dozen) of these facilities across Canada today, but we do expect to see significant growth in this space,” said Mike Shaw, Atco’s senior vice-president.
Meanwhile, Cielo Waste Solutions Corp. is also in the business of transforming waste, but of plastic, wood, and paper, in addition to organic material. The company, headquartered in Vancouver with an office in Red Deer, Alta., transforms waste into diesel, kerosene, and naphtha “at plants designed to be nearly carbon-neutral.”
Cielo owner Don Allan plans to build two more plants in Alberta. The Globe and Mail has more.
Canadian Crude Index was trading at US$59.72 and Western Canadian Select was going for US$61.76 this morning at 9:45 a.m.
This post was copy-edited after publication.