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Rainforest Action Network (RAN) has uncovered a critical funding deadline for Energy Transfer Equity, the parent company behind the Dakota Access Pipeline, and warns banks to steer clear of this dangerous and irresponsible company. The company is seeking a $2.2 billion refinancing loan, which is currently led by the Swiss bank Credit Suisse. Other big banks that want to be on this loan will need to commit by tomorrow, January 27, 2017.
“Banks should reject Energy Transfer Equity’s preliminary request for $2.2 billion of refinancing, given the company’s climate-wrecking business model and egregious human rights abuses at Standing Rock,” said Jason Opeña Disterhoft, Senior Campaigner. “Here’s an opportunity for banks to do the right thing. Stay away from this loan and steer clear of investing in Energy Transfer again.”
Energy Transfer Partners, Energy Transfer LNG, Sunoco Logistics Partners, and Sunoco are all companies in the Energy Transfer Family. The Energy Transfer Equity family owns and operates 71,000 miles of fossil fuel pipelines—meaning its growth is predicated on building new fossil fuel infrastructure that is in direct opposition to global consensus on climate change, the Paris Climate Agreement, and the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP). Its most notorious project, the Dakota Access Pipeline, violates the rights of the Standing Rock Sioux to self-determination and Free, Prior and Informed Consent (FPIC) regarding decisions on their traditional lands. The pipeline has spurred protests by the Standing Rock Sioux and others in North Dakota. Hundreds of thousands of citizens have responded to the Tribe’s request for solidarity and taken actions against Energy Transfer Partners and against the banks that have underwritten its finances.
Recent analysis has found that Energy Transfer Equity and Energy Transfer Partners are in financial distress, with revenue unable to keep up with growing debt loads. A sale of a stake in the Dakota Access Pipeline to Marathon Petroleum and Enbridge Energy Partners has been delayed along with the project itself; this is one example of delays that can affect cash flows in ways that ripple out to destabilize the company at large.
Just this week, Donald Trump signed an executive order in an attempt to push forward the Dakota Access Pipeline. The move ignores the climate impacts of this pipeline project, significant concerns raised by the Standing Rock Sioux about the grievous risk this pipeline poses to the Tribe’s drinking water supply, and the financially weak position of the parent company.
1] “Corporate Overview,” Energy Transfer, 2017.
2] Cathy Kunkel, “More Weaknesses Seen in Companies Behind the Dakota Access Pipeline Project,” Institute for Energy Economics and Financial Analysis, 12/21/2016.