ACC PM 13/08/18

Industry and Association News

1. Ewire: Wheeler Faces Claim of Lobbying Law Violation

   Aug 13, 2018 | Inside EPA

   Weeks after taking over from former Administrator Scott Pruitt due to his ethics and other scandals, acting EPA chief is now facing his own ethics charges.
2. Court Losses Pile Up for EPA

   Aug 13, 2018 | E&E Greenwire

   By Amanda Reilly and Sean Reilly
   
   
   Former EPA Administrator Scott Pruitt's legacy took another hit last week as a federal court ordered EPA to ban a heavily used farm chemical.

LCSA News

3. (ACC Mentioned) Calls for Action on Toxics White House Called 'PR Nightmare'

   Aug 13, 2018 | AP (In The New York Times, Washington Post, CBS...)

   Lauren Woeher wonders if her 16-month-old daughter has been harmed by tap water contaminated with toxic industrial compounds used in products like nonstick cookware, carpets, firefighting foam and fast-food wrappers.

Chemical Management News

4. Roundup Cancer Verdict Sends Bayer Shares Sliding

   Aug 13, 2018 | Reuters (In The New York Times)

   Bayer shares plunged as much as 14 percent on Monday, losing about $14 billion in value, after newly acquired Monsanto was ordered to pay $289 million in damages in the first of possibly thousands of U.S. lawsuits over alleged links between a weedkiller and cancer.
5. US Court’s Ruling Raises Questions for Glyphosate in Europe

   Aug 13, 2018 | Politico.eu

   A landmark court ruling in the U.S. holding Monsanto liable for causing cancer through its glyphosate-based weedkiller is adding fuel to the fire of a years-long battle over the product’s future in Europe.

Energy News

6. U.S. Crude Exports to China Falling Despite Tariffs Exception

   Aug 13, 2018 | Houston Chronicle

   By Jordan Blum
   
   
   New Chinese tariffs are set to affect a wide array of refined products and plastics exports from Houston, but for now crude oil and liquefied natural gas exports are exempted.
7. Democrats Backpedal on Fossil Fuel Pledge

   Aug 13, 2018 | E&E Greenwire

   By Nick Bowlin
   
   
   A Friday vote by the Democratic National Committee backtracked on a pledge not to accept donations from fossil fuel companies, infuriating environmentalists.
8. Washington State Makes Second Attempt to Establish First U.S. Carbon Tax

   Aug 13, 2018 | Natural Gas Intelligence

   By Richard Nemec
   
   
   To the chagrin of the oil and gas industry, Washington state for the second time in two years has placed an initiative on its ballot to establish the first carbon tax in the United States.
9. FERC Orders ACP to Stop All Construction

   Aug 13, 2018 | Natural Gas Intelligence

   By Jamison Cocklin
   
   
   FERC late Friday ordered Atlantic Coast Pipeline LLC to stop all work along the project’s 600-mile route in a move that was widely expected after a federal appeals court last week vacated key permits.
10. Magnitude 6.4 Earthquake Hits Oil-Producing North Slope

    Aug 13, 2018 | Reuters (In E&E Greenwire)

    By Yereth Rosen
    
    
    A magnitude 6.4 earthquake struck yesterday near the Native Alaskan village of Kaktovik and part of the Arctic National Wildlife Refuge where the Trump administration plans to allow oil drilling, but no injuries or damage were reported.

Chemical Security News

11. (ACC Blog) ACC/OSHA Alliance Aims to Keep Workers Safe + Sound

    Aug 13, 2018 | American Chemistry Matters

    ACC is excited to highlight our commitment to worker health and safety initiatives by promoting Occupational Safety and Health Administration (OSHA)’s Safe + Sound Week August 13-19, 2018.
12. (ACC Mentioned) Anti-Terrorism Program in Peril Despite 'Very Real' Threats

    Aug 13, 2018 | E&E Greenwire

    By Corbin Hiar
    
    
    In June 2015, a delivery driver mounted his boss's severed head on a post outside an American-owned chemical facility in southeastern France and then rammed his truck into a warehouse full of explosive canisters.
13. The Pentagon is Rethinking Its Multibillion-Dollar Relationship with U.S. Defense Contractors to Stress Supply Chain Security

    Aug 13, 2018 | The Washington Post

    By Ellen Nakashima
    
    
    The Pentagon has a new goal aimed at protecting its $100 billion supply chain from foreign theft and sabotage: To base its weapons contract awards on security assessments — not just cost and performance — a move that would mark a fundamental shift in department culture.
14. Insight: Oil Companies Scramble to Stay Ahead of Cybersecurity Threats

    Aug 13, 2018 | Platts

    But for a coding error, an attempted cyberattack last year on a petrochemical plant in Saudi Arabia could have led to a catastrophic explosion.

Transportation and Infrastructure News - There are no clips to report at this time.

Environment News

15. EPA Sends Another Wood Stove Rule for White House Review

    Aug 13, 2018 | E&E Greenwire

    By Sean Reilly
    
    
    EPA wants to take another look at the procedures wood stove manufacturers are required to follow in testing new model lines, according to a summary of a pre-rule now under review by the White House Office of Management and Budget.
16. Zinke on California Fires: 'This Is Not a Debate About Climate Change'

    Aug 13, 2018 | The Hill - E2 Wire

    By Miranda Green
    
    
    Interior Secretary Ryan Zinke said climate change had "nothing to do" with California's wildfires, as he visited neighborhoods hard hit by the massive Carr Fire over the weekend.

Industry and Association News

1. Ewire: Wheeler Faces Claim of Lobbying Law Violation

   Aug 13, 2018 | Inside EPA

   Weeks after taking over from former Administrator Scott Pruitt due to his ethics and other scandals, acting EPA chief is now facing his own ethics charges.

   The Campaign for Accountability (CFA), a watchdog group aligned with Democrats, is seeking an investigation into Wheeler over his contacts with the Trump administration as an energy lobbyist, before his appointment as the deputy administrator, in a move that could return focus to ethics investigation at the agency -- though Wheeler's alleged violations did not involve EPA lobbying.

   CFA wrote House and Senate officials on Aug. 10 asking them to open an inquiry into Wheeler's role in what the group claims are violations of the Lobbying Disclosure Act (LDA) by his prior employer, Faegre Baker Daniels Consulting, when it lobbied the Department of the Interior (DOI) to shrink the Bears Ears Natural Monument on behalf of a uranium mining firm.

   The group is alleging that Wheeler and the lobbying group failed to register as lobbyists for Energy Fuels Resources, Inc., under the LDA until well past the law's 45-day deadline, reported only contacts with legislators despite also meeting with DOI, and did not report Wheeler's role in the lobbying effort at all. The alleged violations involve reports filed in the first months of the Trump administration, before Wheeler left in August 2017 and well before his confirmation as deputy EPA administrator on April 12, 2018.

   CFA is linking the claims to the litany of ethics scandals that plagued Wheeler's predecessor Scott Pruitt -- many of which the agency Office of Inspector General confirmed last week are still under investigation, with reports scheduled for release as soon as this month.

   “Wheeler pledged to clean up EPA after the ethics disaster Scott Pruitt, yet it seems Wheeler and his former lobbying firm violated multiple, basic provisions of our nation’s lobbying laws. It doesn’t instill confidence, and Congress should investigate,” CFA Executive Director Daniel E. Stevens said in a statement accompanying the letter.

   However, EPA is pushing back against the ethics group's claims, arguing that Wheeler never violated the lobbying law and that any questions over it should not interfere with his work at EPA, which has no authority over the scope of national monuments.

   “Acting Administrator Wheeler has been very transparent concerning his work with Energy Fuels Resources, even discussing this during his confirmation process. He has consistently worked to comply with the Lobbying Disclosure Act; this particular matter involving Energy Fuels Resources and Bears Ears National Monument does not impact his work at EPA as this is not an agency-related issue,” EPA spokesman Michael Abboud said in a statement to Inside EPA.

   https://insideepa.com/daily-feed/ewire-wheeler-faces-claim-lobbying-law-violation
   

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2. Court Losses Pile Up for EPA

   Aug 13, 2018 | E&E Greenwire

   By Amanda Reilly and Sean Reilly

   Former EPA Administrator Scott Pruitt's legacy took another hit last week as a federal court ordered EPA to ban a heavily used farm chemical.

   During the Obama administration, EPA said it would ban chlorpyrifos after health assessments showed current uses posed dietary and drinking water risks to humans, especially children. But Pruitt reversed the proposed ban in March 2017, declaring that the agency was returning to "sound science."

   The 9th U.S. Circuit Court of Appeals disagreed. In a split decision, a three-judge panel ordered the agency to revoke all tolerances and cancel all registrations for the pesticide within 60 days (Greenwire, Aug. 9).

   The ruling adds to a growing pile of court losses for EPA over the past year and a half.

   "EPA's record under Scott Pruitt and now under [acting EPA Administrator Andrew] Wheeler is pretty abysmal in the federal courts," said Patrice Simms, vice president for litigation at Earthjustice. "It's not terribly surprising. They're engaged in a reckless and irresponsible effort to undermine our public health and environmental protections, and not surprisingly, that's running up against what the law requires."

   In particular, EPA has had little success convincing courts that Pruitt's attempts to delay compliance deadlines for Obama-era rules were legal.

   The U.S. Court of Appeals for the District of Columbia Circuit last year ruled that the agency had unlawfully delayed a regulation requiring new oil and gas operations to reduce methane emissions. A federal judge in California earlier this year knocked down a delay in a regulation limiting formaldehyde emissions from wood products and a delay in a new rule for certifying and training pesticide applicators.

   The Trump administration also recently hit a wall in attempting to delay a decision on an industry challenge to Obama-era air toxics standards for brick and ceramic tile manufacturers. In a ruling that largely sided with environmentalists, the D.C. Circuit rejected EPA's bid to freeze legal proceedings on manufacturers' claims while the agency works on addressing their concerns via an administrative reconsideration set to wind up next summer (E&ENews PM, July 8).

   Under the 1990 Clean Air Act Amendments, the toxics standards were originally due in 2000. At oral arguments last November, the judges had roasted EPA attorneys on why yet another postponement was needed (Greenwire, Nov. 9, 2017).

   Bill Wehrum, EPA's current air chief, had represented the Brick Industry Association during much of the litigation, though he did not participate in oral arguments.

   In other cases, federal lawsuits have compelled EPA to backtrack on deregulatory actions. The agency, for example, withdrew an effort to delay implementation of the Obama administration's ozone standard after being sued by states and green groups.

   EPA suffered a high-profile defeat last month when the D.C. Circuit handed down an emergency stay blocking the agency's order to loosen a cap on production of high-polluting trucks known as glider kits. Pruitt had pushed through the order on his last day in office. Wheeler scrapped it barely a week after the court issued the stay (Greenwire, July 27).

   Bethany Davis Noll, litigation director at the New York University School of Law's Institute for Policy Integrity, said the courts are holding EPA to requirements in underlying statutes and that the decisions demonstrate "a certain level of resilience" in the Administrative Procedure Act, which governs agency rulemaking.

   "You need to go through notice and comment, you need to give us a reasoned explanation for your decision," Noll said. "These principles are being upheld in the courts."

   In the 2-1 decision last week, Judge Jed Rakoff of the U.S. District Court for the Southern District of New York — who sat in on the case in the 9th Circuit — slammed EPA for providing "no justification" for rejecting the chlorpyrifos ban "in the face of scientific evidence that its residue on food causes neurodevelopmental damage to children."

   Dan Farber, a law professor at the University of California, Berkeley, called the opinion "revealing."

   "First, it shows that courts are becoming impatient with foot-dragging by regulatory agencies. This problem isn't unique to the Trump Administration, but it's gotten much worse," he wrote in a blog post today. "Second, Pruitt's invocation of 'sound science' as a way of ignoring all the scientific evidence shows the hollowness of that anti-regulatory buzz phrase."

   He said it was notable that the government "had not even bothered to defend the actual legality of Pruitt's decision." Instead, government lawyers unsuccessfully argued that the courts couldn't review Pruitt's decision on the ban because the agency had not yet finished the process of weighing administrative objections.EPA questions data

   EPA said it's reviewing the chlorpyrifos decision, leaving open the possibility of appeal.

   "We expect that all appellate options to challenge the majority's decision will be considered," the agriculture division of DowDuPont, which makes chlorpyrifos, said in a statement last week.

   EPA spokesman Michael Abboud contends that the agency is hampered from assessing chlorpyrifos because of issues with epidemiological studies conducted by the Columbia Center for Children's Environmental Health supporting the ban.

   The center has found even low exposures to chlorpyrifos during pregnancy may lead to long-term brain damage in children.

   EPA says the raw data sets are necessary to come to a conclusion about the pesticide but that the school has so far declined to provide them.

   "The Columbia Center's data underlying the Court's assumptions remains inaccessible and has hindered the Agency's ongoing process to fully evaluate the pesticide using the best available, transparent science," Abboud said in a statement.

   The agency, meanwhile, plans to limit the types of studies that can be used in drafting environmental regulations.

   Under Pruitt, EPA issued a proposal that would effectively bar the agency from using specific studies for developing new regulations unless the underlying data "are publicly available in a manner sufficient for independent validation."

   But Rakoff wrote for the district court panel that EPA, which has documented likely adverse effects of chlopryrifos residues on foods on infants and children for nearly two decades, was bound by the law to revoke approvals for the pesticide.

   "Over the past decade and more, the EPA has stalled on banning chlorpyrifos," Rakoff wrote. "If Congress's statutory mandates are to mean anything, the time has come to put a stop to this patent evasion."'Agency got what it wanted'

   To be sure, EPA has had a few victories on regulatory rollbacks.

   A judge in the U.S. District Court for the District of Columbia in April tossed out litigation challenging Pruitt's decision to indefinitely stay an Obama-era rule curbing toxic wastewater discharges from power plants.

   Judge Dabney Friedrich found that the lawsuit was moot because EPA had withdrawn the delay and imposed a new one lasting two years.

   "Arguably the agency got what it wanted there," NYU's Noll said. "They're trying to delay these rules so they can repeal them in the end."

   But even that victory may be short-lived, as greens are appealing to the D.C. Circuit. They've also challenged EPA's longer delay in the 5th U.S. Circuit Court of Appeals, which is hearing litigation over the underlying rule.

   The agency has had more success with federal appellate courts outside of Washington in supporting rollbacks or delayed implementation of "regional haze" reduction regulations affecting states like Arkansas, Texas and Utah.

   Under Obama, those rules typically required utilities to retool older coal-fired power plants with scrubbers and other controls to slash releases of sulfur dioxide and nitrogen oxides. Utilities and state regulators have argued that those requirements are not worth the cost, a view the Trump administration appears to share.

   As EPA offered no objection, for example, the 8th U.S. Circuit Court of Appeals in March agreed to stay implementation of Obama-era sulfur dioxide limits affecting several Arkansas power plants. Last week, Arkansas regulators finished work on a substitute plan that environmental groups say will require little, if anything, in the way of new controls (Greenwire, Aug. 9).'Straightforward legal question'

   Elsewhere, however, the administration is getting a lesson in how hard it can be to undo major air regulations, particularly those accompanied by mandatory compliance deadlines.

   Wehrum, for example, has repeatedly voiced interest in revisiting the agency's 2012 landmark rule limiting emissions of mercury and other toxics from coal-fired power plants.

   But most plants met the standards two years ago. The industry recently signaled a desire to move on, asking Wehrum to leave the regulations in place, albeit possibly with some "technical revisions" (Greenwire, July 11).

   If the regulated industry has already installed pollution controls, "they're asking industry to stop taking action that they're already doing, to go ahead and undo that," Earthjustice's Simms said. "That's much harder to do. And the public says, 'Wait a minute, you're going to stop telling them to run that pollution equipment?'"

   A few key tests of Pruitt's legacy remain in the courts. The D.C. Circuit, for example, has yet to issue a ruling on the agency's decision to delay Obama-era safety standards for chemical plants.

   Simms acknowledged that litigation will get "more complicated" as the agency moves from delaying rules to issuing substantive actions, such as a replacement for the Clean Power Plan.

   "When we're challenging a rulemaking that has gone through a complete notice-and-comment process and a comprehensive record has been created ... explaining where an agency does something wrong, either legally or factually, to a court and having a court understand what's at issue is a much more difficult proposition," he said.

   "In many of the cases that we've been litigating so far, the issue is a pretty straightforward legal question."

   https://www.eenews.net/greenwire/2018/08/13/stories/1060093967
   

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LCSA News

3. (ACC Mentioned) Calls for Action on Toxics White House Called 'PR Nightmare'

   Aug 13, 2018 | AP (In The New York Times, Washington Post, CBS...)

   Lauren Woeher wonders if her 16-month-old daughter has been harmed by tap water contaminated with toxic industrial compounds used in products like nonstick cookware, carpets, firefighting foam and fast-food wrappers. Henry Betz, at 76, rattles around his house alone at night, thinking about the water his family unknowingly drank for years that was tainted by the same contaminants, and the pancreatic cancers that killed wife Betty Jean and two others in his household.

   Tim Hagey, manager of a local water utility, recalls how he used to assure people that the local public water was safe. That was before testing showed it had some of the highest levels of the toxic compounds of any public water system in the U.S.

   "You all made me out to be a liar," Hagey, general water and sewer manager in the eastern Pennsylvania town of Warminster, told Environmental Protection Agency officials at a hearing last month. The meeting drew residents and officials from Horsham and other affected towns in eastern Pennsylvania, and officials from some of the other dozens of states dealing with the same contaminants.

   At "community engagement sessions" around the country this summer like the one in Horsham, residents and state, local and military officials are demanding that the EPA act quickly — and decisively — to clean up local water systems testing positive for dangerous levels of the chemicals, perfluoroalkyl and polyfluoroalkyl substances, or PFAS.

   The Trump administration called the contamination "a potential public relations nightmare" earlier this year after federal toxicology studies found that some of the compounds are more hazardous than previously acknowledged.

   PFAS have been in production since the 1940s, and there are about 3,500 different types. Dumped into water, the air or soil, some forms of the compounds are expected to remain intact for thousands of years; one public-health expert dubbed them "forever chemicals."

   EPA testing from 2013 to 2015 found significant amounts of PFAS in public water supplies in 33 U.S. states. The finding helped move PFAS up as a national priority.

   So did scientific studies that firmed up the health risks. One, looking at a kind of PFAS once used in making Teflon, found a probable link with kidney and testicular cancer, ulcerative colitis, thyroid disease, hypertension in pregnant women and high cholesterol. Other recent studies point to immune problems in children, among other things.

   In 2016, the EPA set advisory limits — without any direct enforcement — for two kinds of PFAS that had recently been phased out of production in the United States. But manufacturers are still producing, and releasing into the air and water, newer versions of the compounds.

   Earlier this year, federal toxicologists decided that even the EPA's 2016 advisory levels for the two phased-out versions of the compound were several times too high for safety.

   EPA says it will prepare a national management plan for the compounds by the end of the year. But Peter Grevatt, director of the agency's Office of Ground Water and Drinking Water, told The Associated Press that there's no deadline for a decision on possible regulatory actions.

   Reviews of the data, and studies to gather more, are ongoing.

   Even as the Trump administration says it advocates for clean air and water, it is ceding more regulation to the states and putting a hold on some regulations seen as burdensome to business.

   In Horsham and surrounding towns in eastern Pennsylvania, and at other sites around the United States, the foams once used routinely in firefighting training at military bases contained PFAS.

   "I know that you can't bring back three people that I lost," Betz, a retired airman, told the federal officials at the Horsham meeting. "But they're gone."

   State lawmakers complained of "a lack of urgency and incompetency" on the part of EPA.

   "It absolutely disgusts me that the federal government would put PR concerns ahead of public health concerns," Republican state Rep. Todd Stephens declared.

   After the meeting, Woeher questioned why it took so long to tell the public about the dangers of the compounds.

   "They knew they had seeped into the water, and they didn't tell anybody about it until it was revealed and they had to," she said.

   Speaking at her home with her toddler nearby, she asked, "Is this something that, you know, I have to worry? It's in her."

   While contamination of drinking water around military bases and factories gets most of the attention, the EPA says 80 percent of human exposure comes from consumer products in the home.

   The chemical industry says it believes the versions of the nonstick, stain-resistant compounds in use now are safe, in part because they don't stay in the body as long as older versions.

   "As an industry today ... we're very forthcoming meeting any kind of regulatory requirement to disclose any kind of adverse data," said Jessica Bowman, a senior director at the American Chemistry Council trade group.

   Independent academics and government regulators say they don't fully share the industry's expressed confidence about the safety of PFAS versions now in use.

   "I don't know that we've done the science yet to really provide any strong guidance" on risks of the kinds of PFAS that U.S. companies are using now, said Andrew Gillespie, associate director at the EPA's National Exposure Research Laboratory.

   While EPA considers its next step, states are taking action to tackle PFAS contamination on their own.
   

   In Delaware, National Guard troops handed out water after high levels of PFAS were found in a town's water supply. Michigan last month ordered residents of two towns to stop drinking or cooking with their water, after PFAS were found at 20 times the EPA's 2016 advisory level. In New Jersey, officials urged fishermen to eat some kinds of fish no more than once a year because of PFAS contamination.

   Washington became the first state to ban any firefighting foam with the compound.

   Given the findings on the compounds, alarm bells "should be ringing four out of five" at the EPA, Kerrigan Clough, a former deputy regional EPA administrator, said in an interview with the AP as he waited for a test for PFAS in the water at his Michigan lake home, which is near a military base that used firefighting foam.

   "If the risk appears to be high, and you've got it every place, then you've got a different level" of danger and urgency, Clough said. "It's a serious problem."

   Problems with PFAS surfaced partly as a result of a 1999 lawsuit by a farmer who filmed his cattle staggering, frothing and dying in a field near a DuPont disposal site in Parkersburg, West Virginia, for PFAS then used in Teflon.

   In 2005, under President George W. Bush, the EPA and DuPont settled an EPA complaint that the chemical company knew at least by the mid-1980s that the early PFAS compound posed a substantial risk to human health.

   Congress has since boosted the agency's authority to regulate problematic chemicals. That includes toughening up the federal Toxic Substances Control Act and regulatory mandates for the EPA itself in 2016.

   For PFAS, that should include addressing the new versions of the compounds coming into production, not just tackling old forms that companies already agreed to take offline, Goldman said.

   "Otherwise it's the game of whack-a-mole," she said. "That's not what you want to do when you're protecting the public health."

   https://www.nytimes.com/aponline/2018/08/13/us/ap-us-epa-forever-chemical.html
   

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Chemical Management News

4. Roundup Cancer Verdict Sends Bayer Shares Sliding

   Aug 13, 2018 | Reuters (In The New York Times)

   Bayer shares plunged as much as 14 percent on Monday, losing about $14 billion in value, after newly acquired Monsanto was ordered to pay $289 million in damages in the first of possibly thousands of U.S. lawsuits over alleged links between a weedkiller and cancer.

   After the verdict in favor of a California school groundskeeper with terminal cancer, Monsanto faces more than 5,000 similar lawsuits across the United States over claims it did not warn of the cancer risks of glyphosate-based weedkillers, including its Roundup brand.

   Monsanto, bought by Bayer this year for $63 billion, said that it would appeal against the jury's verdict in California, which is the latest episode in a long-running debate over claims that exposure to Roundup can cause cancer.

   The case by plaintiff Dewayne Johnson, filed in 2016, was fast-tracked for trial due to the severity of his non-Hodgkin's lymphoma, a cancer of the lymph system that he alleges was caused by Roundup and Ranger Pro, another Monsanto glyphosate herbicide.

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   "The jury's verdict is at odds with the weight of scientific evidence, decades of real world experience and the conclusions of regulators around the world that all confirm glyphosate is safe and does not cause non-Hodgkin's lymphoma," Bayer said in a statement.

   Having closed the Monsanto takeover, Bayer is only awaiting the approval of some final antitrust-related asset sales before folding it into its own organization. It did not negotiate any payments from Monsanto shareholders for Roundup-related litigation.

   Bayer shares were down 11.2 percent at 82.93 euros at 1320 GMT, the worst performing stock on the Stoxx Europe 600 index, and on track to close at their lowest in almost five years.

   Barclays analysts said Bayer was in for a "litigious headache".

   "Whilst an appeal is certain and may indeed likely result in the penalty being moderated at a minimum if not reversed altogether, a large number of similar pending cases will now likely multiply."

   Berenberg analyst Alistair Campbell said resolving the issue could cost Bayer $5 billion, citing a rough estimate based on a past product liability settlements such as Merck & Co Inc's $4.9 billion settlement over painkiller Vioxx or Bayer's $4.2 billion total settlement over the Baycol cholesterol drug.EDITORS’ PICKSWar Without EndTransforming Tulsa, Starting with a ParkFrom a Space Station in Argentina, China Expands Its Reach in Latin America

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   The controversy could also affect future revenues.

   Genetically modified (GM) crops that withstand glyphosate are a main source of cash for Monsanto, mainly generated in North and South America, where the technology is widely accepted.

   The health worries could further darken the outlook for a product category following the emergence of weeds that have grown resistant to the herbicide.

   "We think the risk of withdrawal is extremely low, but if it materialized it would be a major blow to the transaction value paid for the company," said Berenberg's Campbell.

   SCIENTIFIC DEBATE

   Discovered by the Monsanto chemist John E. Franz in 1970, patent-free glyphosate herbicides are now sold by the global crop protection industry despite the dispute over its safety.

   The U.S. court ruling caught many Bayer investors off guard as no hard evidence of a causal link to cancer had been produced so far.

   The World Health Organization's (WHO) cancer arm in 2015 classified glyphosate as "probably carcinogenic to humans", but the U.S. Environmental Protection Agency in September 2017 concluded a decades-long assessment of glyphosate risks and found the chemical was not likely carcinogenic to humans.

   A Reuters report in October showed that the WHO's cancer agency dismissed and edited findings from a draft of its review of glyphosate that were at odds with its final conclusion that the chemical probably causes cancer.

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   In Europe, the EU Commission in December drew criticism for renewing the license for glyphosate. Germany and France have meanwhile taken steps to phase out use of the weedkiller.

   The U.S. case may prompt some retailers to curb sales of Roundup products. Homebase, one of Britain's largest home and garden improvement retailers, is reviewing the sale of glyphosate-containing products in the light of the jury’s decision, a spokeswoman said.

   Glyphosate-exposed stocks also plunged in Asia and particularly in Australia where a withering drought has already hit herbicide sales.

   Australian chemical maker Nufarm Ltd, which Macquarie Bank analysts estimate earns about a fifth of its revenue from glyphosate-based products, plunged almost 17 percent to a more than two-year low.

   Its top shareholder, Japan’s Sumitomo Chemical Co Ltd, shed 3 percent, while Australian rural services firm Elders Ltd, which retails herbicides, fell 11 percent.

   https://www.nytimes.com/reuters/2018/08/13/business/13reuters-monsanto-cancer-lawsuit-bayer.html
   

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5. US Court’s Ruling Raises Questions for Glyphosate in Europe

   Aug 13, 2018 | Politico.eu

   A landmark court ruling in the U.S. holding Monsanto liable for causing cancer through its glyphosate-based weedkiller is adding fuel to the fire of a years-long battle over the product’s future in Europe.

   Debate over the safety of glyphosate has waged across the Continent’s agriculture sector since 2015 when the World Health Organization’s International Agency for Research on Cancer (IARC) concluded that glyphosate “probably” causes cancer, in contrast to the European Food Safety Authority’s finding the same year that it is “unlikely” to do so.

   IARC’s conclusion has now been reinforced after a jury at the California Superior Court for the County of San Francisco on Friday ordered Monsanto to pay $289 million in damages to Dewayne Johnson, a former school groundskeeper who sued the American agri-giant in 2016 after he was diagnosed with non-Hodgkin’s lymphoma.

   Thousands of plaintiffs have filed similar suits in the U.S. and Johnson’s case was the first of its kind to proceed to trial. The jury found that Monsanto’s glyphosate-based Roundup weedkiller caused Johnson to develop cancer, and that the company failed to give the appropriate warnings.

   News of the court’s decision caused stocks at Germany’s Bayer AG — which is in the final stages of a $62.5 billion acquisition of Monsanto — to drop by more than 10 percent today, making it the worst performing stock on the STOXX Europe 600 index, according to Reuters.

   “We must fight the invasion of this substance in our market, a threat that exists due to monstrous commercial agreements signed only in the name of profit” — Luigi Di Maio, Italian 5Stars leader

   It also triggered a wave of reactions from European leaders, political parties and the head of the European Parliament’s special committee on the EU’s pesticide authorization process, who called for a ban on glyphosate once and for all in Europe. The question now for Europe is how the verdict affects the political debate about the substance less than a year after the EU approved its use for another five years.

   “We must fight the invasion of this substance in our market, a threat that exists due to monstrous commercial agreements signed only in the name of profit,” Italy’s Deputy Prime Minister Luigi Di Maio said on his Facebook page over the weekend.

   “Health and the precautionary principle are the beacon of our government’s action,” he added, referring to the EU’s concept that policymakers should block substances from the market when there’s no scientific consensus about their impact on human health or the environment.

   France’s Environment Minister Nicolas Hulot said the court’s verdict was the “beginning of a war” against glyphosate in Europe. “If we wait, such poisons will not be prevented from doing their damage and the victims will be excessively numerous,” he said, speaking to BFM radio over the weekend.

   French Environment Minister Nicolas Hulot | Eric Feferberg/AFP via Getty Images

   France has already promised to phase out the use of glyphosate domestically within three years. Recently, the European Commission proposed putting France in charge of determining whether the weedkiller is safe for use in Europe’s agriculture sector. And French President Emmanuel Macron has ordered his country’s food safety authorities to carry out new scientific studies on the substance’s safety.

   The governments of both Italy and Germany have also pledged to ultimately phase out glyphosate despite farmers saying there is no other alternative that is as safe or cheap.

   Austria’s former Minister of Health Pamela Rendi-Wagner said in response to the California verdict that the government is playing “with the health of the Austrians,” by not having a clear position on banning glyphosate.

   A European Commission spokesperson declined to comment on the ruling at a press briefing today, saying it’s up to EU member countries to grant licenses and authorization. The spokesperson also noted that the five-year extension granted to glyphosate by the EU is shorter than the typical 15 years.

   Monsanto said the ruling should not discount views from international regulators around the world, which have called glyphosate safe.

   “Today’s decision does not change the fact that more than 800 scientific studies and reviews — and conclusions by the U.S. Environmental Protection Agency, the U.S. National Institutes of Health and regulatory authorities around the world — support the fact that glyphosate does not cause cancer, and did not cause Mr. Johnson’s cancer,” the company said in a statement, adding that it would appeal the decision.

   “I think Bayer bought a headache. Monsanto in the eyes of so many people, it’s manipulating and cheating and now Bayer has to solve it somehow” — Hans Muilerman, from Pesticide Action Network

   Bayer declined to comment directly on the court decision, but a spokesperson for the company said “the jury’s verdict is at odds with science.”

   “Regulators around the world concluded and confirmed that glyphosate is safe when used according to the label instructions,” said Utz Klages, head of external communications for Bayer.

   Still, with public opinion surrounding the use of glyphosate in Europe so divided, science will not be the only factor hanging over the weedkiller’s fate.

   “When there is a controversy it is necessary to at the very least apply the precautionary principle in order to protect the health of 500 million Europeans,” said Eric Andrieu, chair of the European Parliament’s special committee on the EU’s pesticide authorization process, on Monday to France Info.

   Hans Muilerman, chemicals coordinator at the Pesticide Action Network, an NGO that fights against the use of chemicals in the agriculture sector, said the court’s verdict could spell a huge headache for Bayer as it takes over Monsanto.

   “From a political point of view it’s something people are concerned about and they want to get rid of it,” he said. “I think Bayer bought a headache. Monsanto in the eyes of so many people, it’s manipulating and cheating and now Bayer has to solve it somehow. I don’t think they will get rid of the problem just by deleting the name of Monsanto.”

   https://www.politico.eu/article/glyphosate-future-europe-again-in-doubt-after-us-court-fines-monsanto/
   

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Energy News

6. U.S. Crude Exports to China Falling Despite Tariffs Exception

   Aug 13, 2018 | Houston Chronicle

   By Jordan Blum

   New Chinese tariffs are set to affect a wide array of refined products and plastics exports from Houston, but for now crude oil and liquefied natural gas exports are exempted.

   Still, crude exports from Texas to China have fallen sharply this summer in part due to fears over President Trump's ongoing trade war and also because of shrinking discounts on U.S. crude oil, said Sandy Fielden, director of oil and products research at Morningstar.

   Instead, China, which surpassed the U.S. as the world's largest crude importer last year, is buying more oil from Russia and Saudi Arabia.

   U.S. energy companies are learning they need to build better long-term relationships with Asian nations, especially China, to sell crude, LNG and other petroleum products, Fielden argued. About 75 percent of U.S. crude exports come from the Texas Gulf Coast.

   RELATED: Race is on to build Texas' first offshore oil export terminal

   "The industry is figuring out there is more to export markets than delivering crude to Houston or Corpus Christi docks by pipeline and waiting for passing tankers," Fielden stated in a Monday report. "A necessary first step is better shipping, hence the flurry of midstream projects announced this year to build out Gulf Coast export terminals to handle giant tankers, or very large crude carriers, that keep long-haul freight costs to a minimum."

   U.S. crude oil exports to China surged from about 22,000 barrels a day in 2016 up to almost 400,000 barrels day last year and early in 2018, accounting for about 20 percent of all U.S. crude shipments. This summer, those volumes have plummeted down below 200,000 barrels daily.

   U.S. energy companies are compensating for now by diverting more of that crude to India and other Asian nations like South Korea, Taiwan, Singapore and Thailand.

   https://www.chron.com/business/energy/article/U-S-crude-exports-to-China-falling-despite-13152040.php
   

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7. Democrats Backpedal on Fossil Fuel Pledge

   Aug 13, 2018 | E&E Greenwire

   By Nick Bowlin

   A Friday vote by the Democratic National Committee backtracked on a pledge not to accept donations from fossil fuel companies, infuriating environmentalists.

   DNC Chairman Tom Perez introduced the measure Friday morning, and it passed that afternoon (E&E News PM, Aug. 10).

   The overall document reaffirms party support for labor, including "fossil fuel workers," and said the DNC will continue to take contributions from "employers' political action committees."

   As environmental activists read it, this clause undoes a June motion put forward by DNC member Christine Pelosi, daughter of House Minority Leader Nancy Pelosi (D-Calif.), that banned money from political action committees linked to oil, gas and coal corporations or industries (E&E News PM, June 12).

   "To be clear —> @DNC staff and officers NEVER consulted me on language to reverse my resolution banning corporate fossil fuel PAC money and now said they have to keep the resolution as is because of all the work *we* did," Christine Pelosi wrote on Twitter.

   In an email to E&E News on Friday, she suggested Perez floated the measure Friday morning without warning. "I'm okay with ALL the language supporting unions and workers EXCEPT where it says accept 'employer PAC,'" she wrote.

   The DNC has not taken any fossil fuel corporate contributions since the ban, according to donation records. During the entire 2018 campaign cycle, energy and natural resource industries gave the party almost $238,000, a pittance compared to the $10.4 million from the finance industry, according to data compiled by the Center for Responsive Politics.

   Progressive Democrats from around the country slammed the move. RL Miller, the founder of Climate Hawks Vote who co-sponsored the move to ban energy donations, said she was "furious." Miller's group has pushed candidates across the country to reject all fossil fuel contributions.

   Molly Kelly, a Democratic gubernatorial candidate from New Hampshire, said in a statement, "The DNC is wrong," and noted her pledge to reject fossil fuel dollars "and not be influenced by those who only make the problem of a rapidly changing climate even worse."

   Mike Levin, the Democratic candidate in California's 49th District who has taken a similar pledge, wrote on Twitter: "If we truly want a transition to sustainability, the Democratic National Committee needs to lead by example" (Climatewire, Aug. 7).

   Labor interests, who thought the June resolution went too far and didn't do enough to recognize workers, even those in fossil fuels, hailed the move by the DNC.

   "Thanks @DNC for recognizing that ALL workers should have a voice in the Democratic Party," wrote the United Mine Workers of America. "Shutting out energy workers is not the way to build an inclusive party that stands for everyone."

   The union's donations lean heavily Democratic.

   The measure makes no mention of climate change, but does refer to an "all-of-the-above" energy policy — a much-maligned phrase among activists pushing the country to move beyond fossil fuels and the party to reject its profits.

   The measure praised "forward-looking employers" that are "moving us towards a future fueled by clean and low-emissions energy technology, from renewables to carbon capture and storage to advanced nuclear technology."

   https://www.eenews.net/greenwire/2018/08/13/stories/1060093961
   

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8. Washington State Makes Second Attempt to Establish First U.S. Carbon Tax

   Aug 13, 2018 | Natural Gas Intelligence

   By Richard Nemec

   To the chagrin of the oil and gas industry, Washington state for the second time in two years has placed an initiative on its ballot to establish the first carbon tax in the United States.

   §  Access to full text unavailable – subscription required.

   Story can be found here: 

   http://www.naturalgasintel.com/articles/115407-washington-state-makes-second-attempt-to-establish-first-us-carbon-tax?v=preview
   

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9. FERC Orders ACP to Stop All Construction

   Aug 13, 2018 | Natural Gas Intelligence

   By Jamison Cocklin

   FERC late Friday ordered Atlantic Coast Pipeline LLC to stop all work along the project’s 600-mile route in a move that was widely expected after a federal appeals court last week vacated key permits.

   §  Access to full text unavailable – subscription required.

   Story can be found here: 

   http://www.naturalgasintel.com/articles/115408-ferc-orders-acp-to-stop-all-construction?v=preview
   

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10. Magnitude 6.4 Earthquake Hits Oil-Producing North Slope

    Aug 13, 2018 | Reuters (In E&E Greenwire)

    By Yereth Rosen

    A magnitude 6.4 earthquake struck yesterday near the Native Alaskan village of Kaktovik and part of the Arctic National Wildlife Refuge where the Trump administration plans to allow oil drilling, but no injuries or damage were reported.

    The temblor, which occurred just before 7 a.m. local time, was the most powerful on record to hit Alaska's oil-producing North Slope, said Paul Huang, a seismologist and deputy director of the National Tsunami Warning Center in Palmer, Alaska.

    No tsunami alert was generated, though ground motion was felt as far away as Fairbanks, nearly 400 miles to the south.

    The quake had no impact on operations of the Trans-Alaska pipeline system that carries North Slope crude 800 miles to the marine terminal at Valdez, according to a statement from Alyeska, the consortium that runs the pipeline.

    Alyeska said it would conduct follow-up inspections of the pipeline and related facilities. Inspection teams likewise found nothing amiss at the Prudhoe Bay oil field about 85 miles to the east, said Megan Baldino, a spokeswoman for BP Exploration (Alaska) Inc., which operates the field.

    The quake, initially measured at a magnitude 6.5, was followed by a series of aftershocks, the largest of which was a 6.0 tremor, according to the U.S. Geological Survey.

    The main earthquake was centered 40 miles southwest of Kaktovik, a coastal Inupiat village of about 260 residents at the northern edge of ANWR.

    State emergency officials said they had no reports of damage, but locals in Kaktovik said the tremor did not pass unnoticed.

    "I felt a little shaking and felt dizzy, and felt the shelves shaking," said Archie Brower, assistant manager at the Kaktovik Kikiktak grocery.

    The epicenter also lies near an area the Interior Department plans to lease for petroleum exploration along ANWR's coastal plain, which had been off-limits to fossil fuel development until a provision was enacted as part of President Trump's 2017 tax bill.

    The vast and environmentally pristine coastal plain, wedged between the Beaufort Sea and Brooks Range mountains, is prized for its importance to caribou, polar bears and other wildlife but is believed to hold billions of barrels of oil.

    "Scientifically, however, this region is poorly understood and the behavior of the fault or faults responsible for today's earthquake are not known," the Alaska Earthquake Center in Fairbanks said in a bulletin.

    Strong earthquakes are not uncommon in seismically active Alaska, but they tend to occur in remote, sparsely populated regions where there is little or no damage. 

    https://www.eenews.net/greenwire/2018/08/13/stories/1060093937
    

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Chemical Security News

11. (ACC Blog) ACC/OSHA Alliance Aims to Keep Workers Safe + Sound

    Aug 13, 2018 | American Chemistry Matters

    ACC is excited to highlight our commitment to worker health and safety initiatives by promoting Occupational Safety and Health Administration (OSHA)’s Safe + Sound Week August 13-19, 2018. Safe + Sound Week is “a nationwide event to raise awareness and understanding of the value of safety and health programs that include management leadership, worker participation and a systematic approach to finding and fixing hazards in workplaces.”

    As you may know, late last year, ACC signed an agreement with OSHA to form a National Alliance. The whole idea behind this alliance is to continue to foster safe and healthful American workplaces operating with diisocyanate chemicals along the polyurethane value chain.

    Three groups here at ACC will lead the work with OSHA: the Center for the Polyurethanes Industry (CPI), Diisocyanates (DII) and Aliphatic Diisocyanates (ADI) panels.

    For Safe + Sound Week, OSHA is encouraging organizations of all sizes to participate and “show their commitment to safety to workers, customers, the public [and] supply chain partners.” We think our partnership with OSHA on the National Alliance fits exactly in the Safe + Sound Week mold.

    ACC is pleased to take this opportunity to continue educating stakeholders in the polyurethanes value chain. While worker safety is always a priority for ACC members across the industry, the event provides opportunity to reinforce key messages and provide new information. We want safety guidelines, training procedures and all resources to reflect the most current understanding of diisocyanate science.

    The first tool has already been developed and is available online. The ADI panel, through the Alliance, recently released an infographic to educate users on personal protective equipment in automotive refinish coating applications. It has already been featured in various trade magazines and newsletters. More tools will follow throughout the two-year course of the Alliance.

    By collaborating with OSHA, we are able to reach new audiences, allowing us to expand our messaging. The more people who are made aware of and understand sound safety principles, the better off all workers are.

    Working through this Alliance with OSHA, ACC is able to provide members, occupational physicians, stakeholders and others with information, guidance and access to training resources that will help them protect the health and safety of workers.

    CPI, ADI and DII all have substantial resource libraries with sources of information about safety and product stewardship, including guidance materials on general polyurethane product safety, worker protection, waste disposal, transportation guidelines, industrial hygiene and regulatory compliance.

    For more information on the Alliance, you can visit the ACC site or the OSHA Alliance site.

    For more information on Safe + Sound Week, check out the OSHA website.

    https://blog.americanchemistry.com/2018/08/acc-osha-alliance-aims-to-keep-workers-safe-sound/
    

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12. (ACC Mentioned) Anti-Terrorism Program in Peril Despite 'Very Real' Threats

    Aug 13, 2018 | E&E Greenwire

    By Corbin Hiar

    In June 2015, a delivery driver mounted his boss's severed head on a post outside an American-owned chemical facility in southeastern France and then rammed his truck into a warehouse full of explosive canisters.

    The following month, someone cut a hole in the fence around a petrochemical plant near Marseille, attached explosive devices to liquid storage tanks and triggered an inferno that took dozens of fire trucks several hours to extinguish.

    Both incidents are evidence of the types of threats the U.S. Department of Homeland Security's Chemical Facility Anti-Terrorism Standards (CFATS) program is meant to prevent, according to the agency. But the latest four-year congressional approval for CFATS is set to end at the end of 2018.

    [+] Two chemical facilities in France were attacked in 2015. Claudine Hellmuth/E&E News; Snazzy maps/© 2018 Google (base map)

    If the program's authorization expires, DHS officials say, thousands of U.S. facilities that make or use large volumes of dangerous chemicals — places like refineries and plastics plants as well as swimming pools and vineyards — could be more vulnerable to attacks similar to those that hit France three years ago.

    "The threat of chemical terrorism remains a very real and a very relevant one," David Wulf, the head of the DHS office that runs CFATS, said last month in a nondescript conference room near his Crystal City, Va., office in suburban Washington.

    "We have been reasonably fortunate here in the United States that we haven't seen the same degree of attacks using chemicals," he said. But, Wulf added, "these chemicals are very much in the crosshairs."

    Wulf, who has served as director of the Infrastructure Security and Compliance Division for seven of CFATS' 11 years, attributes the lack of successful strikes to "the chemical security culture that we've built here in the United States."

    "CFATS is a big part of that," he said. "It plays a big deterrent role."

    The program requires facilities that possess or produce certain quantities of 322 "chemicals of interest" to report information about how they are stored to DHS. The agency considers those chemicals dangerous because, like chlorine gas, they can cause immediate harm if released or, in the case of bomb ingredient ammonium nitrate, can be easily converted into explosive or poisonous mixtures.

    DHS then reviews the confidential data submitted by facilities and determines whether they are "high risk." Facilities that don't meet the threshold have no further obligations.

    But those that DHS considers high risk are then divided into four tiers, with increasing levels of security planning and compliance measures necessary for the riskiest tiers. The agency considers everything from the perimeter gate design and patrol frequency to the location of security cameras and the strength of cybersecurity controls that a facility may have.

    Chemical facilities that fail to follow CFATS can face enforcement actions ranging from compliance requests to fines totaling tens of thousands of dollars a day or shutdown orders. Wulf said most problems DHS finds are remedied with nothing more than a compliance request.

    The vast majority of CFATS-regulated facilities are not considered high risk, according to DHS data recently analyzed by the U.S. Government Accountability Office, an independent congressional agency.

    Of 29,195 facilities CFATS has vetted over the years, 3,500 have even been assigned a tier. The vast majority of those high-risk facilities — 3,260 — are in tiers 4 or 3, the two lowest. On the other end of the scale, just 161 facilities nationwide are rated as tier 1.

    The program has a head count of around 250 people, most of whom are inspectors, and an annual budget of about $72 million.

    Additional information on CFATS remains hard to come by, and that has long troubled some environmental groups. Greenpeace in particular has advocated for DHS to release more data about where risky facilities are located and what they are doing to prevent potential harm to surrounding communities.

    But DHS, with the support of federal courts, has consistently rejected greater public scrutiny of CFATS (Greenwire, May 3).

    "We don't like to give terrorists a road map to America's highest-risk facilities," Wulf explained.Rocky start

    The "Chemical Security Bell" was dedicated in May 2013 to commemorate the 100th site security plan approved under the Chemical Facility Anti-Terrorism Standards program and has been rung every time one is approved since then. Corbin Hiar/E&E News

    Calls for federal oversight of chemical facilities began soon after the Sept. 11, 2001, terrorist attacks. Yet it took more than five years for lawmakers and the George W. Bush administration to agree on legislative language for such an effort (Greenwire, Dec. 22, 2006).

    A 2007 spending package gave DHS six months to issue rules "establishing risk-based performance standards for security of chemical facilities" and required "vulnerability assessments and the development and implementation of site security plans for chemical facilities." The law then called for the program to stay in effect for three years.

    As CFATS' initial authorization drew to a close, however, DHS had little to show for it. When Wulf left the Justice Department's Bureau of Alcohol, Tobacco, Firearms and Explosives in 2011 to take over CFATS, he became its eighth leader in four years. During that time, DHS hadn't approved a single site security plan for any of the thousands of facilities required to participate in the program.

    In the years that followed, Wulf and CFATS faced intense scrutiny from lawmakers and the Government Accountability Office, which estimated it would take the program up to nine years to work through its backlog of security plans (E&E Daily, March 15, 2013).

    Later that year, Wulf's deputy, a Navy veteran, constructed the office's "Chemical Security Bell" from a decommissioned ship's ringer. It was dedicated May 22, 2013, to commemorate the approval of the program's 100th site security plan.

    But at that point, the fate of the program was still hanging in the balance "from fiscal year to fiscal year or, worse, from continuing resolution to continuing resolution," Wulf said.

    That uncertainty was only worsened by the government shutdown in October 2013.

    "There were legitimate questions — because CFATS was tied to appropriations and wasn't statutorily authorized — as to whether during that 2 ½ weeks the program continued in force," Wulf said. If not, he explained, facilities would no longer have been obliged to abide by their site security plans and DHS would have had limited ability to take enforcement actions for national security purposes.

    "That's not a situation anyone wanted to see repeated, and we certainly relayed that experience over the course of the next year as we drove toward that long-term reauthorization," the CFATS leader said.

    The 2013 explosion of a West, Texas, fertilizer plant after an intentionally set fire also helped reinforce the danger posed by such facilities. The blast killed 15 people, including 12 first responders, and injured more than 260 others (E&E News PM, May 11, 2016).

    Shortly before the end of the 113th session of Congress, lawmakers approved by voice votes the "Protecting and Securing Chemical Facilities From Terrorist Attacks Act," which extended CFATS for four years and streamlined the program's site security plan approval process (E&E News PM, Dec. 18, 2014).

    Since that law took effect, Wulf has effectively eliminated the program's site-security backlog and — to the annoyance of the agency lawyer who sits nearby — rung the office bell once for each of the thousands of plans he's signed off on. The program has also begun verifying the accuracy of the data it uses to evaluate facilities, vetting personnel at the highest-risk facilities for suspected ties to terrorist groups and ramping up compliance inspections.

    All that has been accomplished without overburdening the facilities affected by CFATS. Representatives from the American Chemistry Council, National Association of Chemical Distributors and Fertilizer Institute all urged the Senate Homeland Security and Governmental Affairs Committee in June to extend the program.

    "It's not every day that you see industry groups beating a path to Capitol Hill to ask for a reauthorization of a regulatory program," he said. "But this is a program that is well suited to the task at hand."

    As a result, Wulf got a much warmer than usual reception from lawmakers when he appeared before a House Energy and Commerce panel earlier this year.

    "Very few people have demonstrated the courage, commitment and longevity with the program that he has," Environment Subcommittee Chairman John Shimkus (R-Ill.) said introducing Wulf. "He's kind of the Cal Ripken [Jr.] of CFATS."

    When Wulf returned to his Crystal City office after that event, his staff had waiting for him a life-size cardboard cutout of the former Baltimore Orioles Hall of Famer, who holds Major League Baseball's "Iron Man" record for appearing in 2,632 consecutive games.Trouble ahead?

    David Wulf, the director of the Department of Homeland Security's Infrastructure Security and Compliance Division, has overseen CFATS program for so long that he's drawn comparisons to Cal Ripken Jr., Major League Baseball's "Iron Man." Corbin Hiar/E&E News

    But several barriers to reauthorizing CFATS remain.

    As Democrats at the Energy and Commerce subcommittee hearing made clear, they oppose an effort by Senate Republicans to remove some 30 explosives plants from the program and would like to see it expanded to cover other types of chemical-using facilities that are currently excluded, such as public water systems and wastewater treatment plants. Some environmental groups would like to see a more comprehensive oversight program as well (E&E Daily, June 15).

    There are also debates about how long to potentially extend CFATS and whether people working at lower-tiered facilities should be screened for terrorist ties, according to Wulf.

    Meanwhile, the Government Accountability Office is calling for DHS to share more information about chemical facilities with local officials and to better measure the effectiveness of CFATS (E&E News PM, Aug. 8).

    Wulf doesn't see any of those issues as likely deal breakers.

    "We're optimistic that a bill will be introduced in the not too distant future, and we will then have something with which to work as we move through the process," he said. With "support in both chambers of Congress, [this] should be a slam dunk, in my view."

    But even if lawmakers drop the ball, Wulf thinks CFATS is likely to continue.

    "I don't anticipate, even if we are unable to get long-term reauthorization across the finish line in this Congress, that the program would just go away," he said. "We would expect to revert back to authorization through the appropriations process and strive to get a long-term authorization in place as quickly as we could in the next Congress."

    The problem with such a situation, in Wulf's view, is that it sends the wrong message to chemical facility owners and operators.

    "They deserve the certainty that comes with knowing that the program is here to stay," he said.

    A long-term authorization also encourages cooperation from the few facilities "that might be seeking to wait out the program to avoid their obligations," he added.

    After years of facing questions about the management of the program, Wulf is hoping the progress CFATS has made will be enough to earn it at least another four-year lease on life.

    "Anti-terrorism is a hard arena in which to apply metrics, but we know that security has been hardened, that tens of thousands of security measures have been put in place at these high-risk facilities across the country," he said. "So we can tell it's working. It's deterring, certainly, bad things from happening, and it's positioning our owners and operators to prevent terrorist attacks."

    https://www.eenews.net/greenwire/2018/08/13/stories/1060093959
    

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13. The Pentagon is Rethinking Its Multibillion-Dollar Relationship with U.S. Defense Contractors to Stress Supply Chain Security

    Aug 13, 2018 | The Washington Post

    By Ellen Nakashima

    The Pentagon has a new goal aimed at protecting its $100 billion supply chain from foreign theft and sabotage: To base its weapons contract awards on security assessments — not just cost and performance — a move that would mark a fundamental shift in department culture.

    The goal, based on a strategy called Deliver Uncompromised, comes as American defense firms are increasingly vulnerable to data breaches, a risk highlighted earlier this year by China’s alleged theft of sensitive informationrelated to undersea warfare, and the Pentagon’s decision last year to ban software made by the Russian firm Kaspersky Lab.

    “The department is examining ways to designate security as a metric within the acquisition process,” Maj. Audricia Harris, a Pentagon spokeswoman, said in a statement. “Determinations [currently] are based on cost, schedule, and performance. The department’s goal is to elevate security to be on par with cost, schedule, and performance.”

    The strategy was written by the Mitre Corp., a not-for-profit company that runs federally funded research centers, and the firm released a copy of its report Monday.

    “The major goal is to move our suppliers, the defense industrial base and the rest of the private sector who contribute to the supply chain, beyond a posture of compliance — to owning the problem with us,” said Chris Nissen, director of asymmetric threat response at Mitre.

    Harris said the Pentagon will review Mitre’s recommendations before proceeding. She added that the Department of Defense, working with Congress and industry, “is already advancing to elevate security within the supply chain.”

    Testifying to Congress in June, Kari Bingen, the Pentagon’s deputy undersecretary for intelligence, said: “We must have confidence that industry is delivering capabilities, technologies and weapon systems that are uncompromised by our adversaries, secure from cradle to grave.”

    Security should be seen not as a “cost burden,” she told the House Armed Services Committee, “but as a major factor in their competitiveness for U.S. government business.”

    The new strategy is necessary, officials say, because U.S. adversaries can degrade the military’s battlefield and technological advantage by using “blended operations” — hacking and stealing valuable data, manipulating software to sabotage command and control systems or cause weapons to fail, and potentially inducing a defense firm employee to insert a faulty component or chip into a system.

    “A modern aircraft may have more than 10 million lines of code,” Mitre’s report said. “Combat systems of all types increasingly employ sensors, actuators and software-activated control devices.”

    The term “Deliver Uncompromised” grew out of a 2010 meeting of senior counterintelligence policy officials, some of whom lamented that the Defense Department was tolerating contractors repeatedly delivering compromised capabilities to the Pentagon and the intelligence community.

    Addressing the security issue requires greater participation by counterintelligence agencies, which can detect threats against defense firms, the report said, and ideally, the government should establish a National Supply Chain Intelligence Center to monitor threats and issue warnings to all government agencies.

    Ultimately, the military’s senior leaders bearresponsibility for securing the supply chain and must be held accountable for it, the report said.

    The Defense Department, though one of the world’s largest equipment purchasers, cannot control all parts of the supplier base. Nonetheless, it has influence over the companies it contracts with as it is the principal source of business for thousands of companies. It can shape behavior through its contracts to enhance supply chain security, the report said.

    Legislation will be needed to provide incentives to defense and other private sector companies to boost security, Mitre said. Congress should pass laws that shield firms from being sued if they share information about their vulnerabilities that could help protect other firms against cyberattacks; or if they are hacked by a foreign adversary despite using advanced cybersecurity technologies.

    Contractors should be given incentives such as tax breaks to embrace supply chain security, the report suggested.

    The Department of Homeland Security is addressing the security of the information technology supply chainthrough its newly established National Risk Management Center. “What we’re saying is you should be looking at what vendors are doing to shore up their cybersecurity practices to protect the supply chain,” said Christopher Krebs, DHS undersecretary for the National Protection and Programs Directorate.

    The National Counterintelligence and Security Center, an agency of the Office of the Director of National Intelligence that coordinates the government’s counterintelligence strategy, said in a report last month that software supply chain infiltration has already threatened U.S. critical infrastructure and is poised to endanger other sectors. According to the NCSC, last year “represented a watershed in the reporting of software supply chain” attacks. There were “numerous events involving hackers targeting software supply chains with backdoors for cyber espionage, organizational disruption or demonstrable financial impact,” the agency found.

    https://www.washingtonpost.com/world/national-security/the-pentagon-is-rethinking-its-multibillion-dollar-relationship-with-us-defense-contractors-to-stress-supply-chain-security/2018/08/12/31d63a06-9a79-11e8-b60b-1c897f17e185_story.html?utm_term=.0ab6ee611a2e
    

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14. Insight: Oil Companies Scramble to Stay Ahead of Cybersecurity Threats

    Aug 13, 2018 | Platts

    This is the first in a series of two special features on cybersecurity in the oil and gas sector

    But for a coding error, an attempted cyberattack last year on a petrochemical plant in Saudi Arabia could have led to a catastrophic explosion.

    Malware implanted into the control system to sabotage the plant accidentally triggered a shutdown, but investigators say the attack was one of the most technologically advanced they had ever seen. Chillingly, they say the assailants – still not publicly identified – have likely already fixed the glitch and are lying in wait to target their next facility.

    That close call and several others have many experts convinced that the oil industry, even as it invests millions of hours on safety procedures, is ill-prepared on the cyber front.

    “The sector is becoming fair game. [Hackers] are seeing opportunities to attack the sector, and facility operators believe they are very well-protected,” a Washington-based cybersecurity analyst at FireEye and former oil industry consultant, Marina Krotofil said, “It is not a good combination.”

    Much of the focus on energy-related cybersecurity has been on power plants and grids, but authorities say oil and gas companies — responsible for critical infrastructure including refineries, pipelines and ports — are ripe targets for hackers to implant malware that can disrupt operations, endanger public safety, wreak havoc on markets and disclose sensitive information.

    Spending on security measures is insufficient by and large, and collaboration among companies on best practices is woeful, given the secretive and competitive nature of the oil business, according to people in the field.

    Often, national security can be at stake.

    In the Middle East alone, which accounts for more than a third of global crude production, cyberattacks cost the oil and gas industry $1 billion last year in outages and loss of confidential data, according to a March report by industrial services provider Siemens and the Ponemon Institute. However, only 47% of Middle East oil and gas companies surveyed in the report said they prioritize continually monitoring all infrastructure  for cyber threats and attacks.

    “In general, the oil industry is conservative in nature,” said Gary Williams, a senior director for Schneider Electric, which installs control and safety systems in refineries and other critical infrastructure often targeted by hackers. “The industry tends to take an ‘if it ain’t broke, don’t fix it’ approach to how we operate. But we must change this model, and our culture, when it comes to cybersecurity.”

    Some experts warn it may take a major successful cyberattack for the industry to fully grasp how great the danger is.

    “Organizations need to invest in cybersecurity, but they don’t see it’s a major threat,” senior research fellow with Chatham House’s International Security Department Beyza Unal,  said. “We haven’t seen an event where an entire critical infrastructure got taken out. But it will happen. So how do you get companies to invest in that?”More complex, more often

    Across the industry, energy companies spend less than 0.2% of their revenues on cybersecurity, according to a recent analysis by consultancies Precision Analytics LLC and the CAP Group. That is less than a third of what banks and financial services companies spend protecting their businesses from hackers.

    Meanwhile, hackers targeting the industry don’t discriminate by size. Spanish oil company Cepsa is a relative minnow compared with giants like Saudi Aramco or ExxonMobil, but still finds its network targeted about 20 times each day. “Both the range and number of potential attacks are increasing,” Cepsa spokeswoman Marta Llorente Señorans said.

    None of the attacks has succeeded, to its knowledge, according to company officials. Its facilities have not failed, and its operations have remained unscathed by any cyber-related outages.

    The company, which operates two refineries with a throughput of 430,000 b/d and holds working interests in upstream projects with an output of about 100,000 b/d, is increasing cybersecurity spending by a minimum of 25% annually.

    Eni, the Italian energy giant, said it has fended off several cyberattacks targeting its industrial control systems, including at the company’s refineries.

    “Cyberattack is one of our corporate top risks,” Eni spokesman Roberto Carlo Albini said. “We have developed a specific security architecture for industrial control systems we perform vulnerability and security assessments on our infrastructure regularly, and we have a dedicated team for security monitoring and incident response.”

    Cepsa and Eni’s acknowledgement of the problem is unusual. Many oil and gas companies contacted by S&P Global Platts for this story — ranging from state-owned companies to integrated majors, independent refiners and terminal operators — declined to comment on the issue or disclose cyber defense spending. Few disclosed any assaults on their systems.Unknown unknowns

    But experts say that known attempts account for likely just a fraction of the assaults launched every day – and it’s the ones that remain undetected that are the most worrying.

    Many malware programs are intended to gather information on a plant, not necessarily launch an imminent attack, and they may lurk inside a system for months or even years before their creators gain enough intelligence to develop and unleash custom-built viruses that can take down an entire facility.

    Hackers who have gained access to a system may just be waiting for the right moment to do their worst, said Daniel Quiggin, a research fellow at Chatham House who specializes in energy systems. “A lot of reconnaissance has gone on,” he said. “To what end, we don’t know, and that is why everybody is so concerned.”

    In the case of the Saudi petrochemical plant incident, hackers implanted malware into the facility’s Triconex safety control system — hardware and programs manufactured by Schneider Electric — which regulates voltage, pressure and temperature.

    But rather than forcing a shutdown or disruption of the plant, the malware sought to reprogram the safety system, so that fail-safes would not be triggered when a subsequent piece of malware caused the plant to overheat, explode or otherwise catastrophically malfunction, according to FireEye.

    Given the sophistication of the malware involved and the likely long development time and cost it would have taken to build, authorities say only one kind of actor could be behind the intrusion: a nation state.

    Investigators continue to look into the incident and have neither named the facility nor identified the attackers, though officials suspect they were backed by Saudi Arabia’s longstanding geopolitical rival Iran, a charge Tehran has denied.

    With tensions rising in the Middle East, Krotofil said to expect more incidents targeting oil and gas operations there.

    “It’s strategic,” she said. “It’s countries where their ability to produce or not produce oil has a huge impact on global oil markets. Therefore, there [are] continuous, multiple attempts to disrupt operations in the Middle East.”

    Iran has been steadily building its hacking capabilities, and the fear among US security experts is it could then turn a volley of attacks on the US, as it withdraws from the nuclear deal and re-imposes sanctions that bite at Iran’s oil exports.

    “There are legitimate reasons to be concerned that Tehran’s intention in targeting critical infrastructure is to hold social and economic assets in adversarial countries at risk in the event it needs to escalate or retaliate during conflict,” the Carnegie Endowment for Peace warned in a recent report on Iran’s cyber threat.

    But Iran, too, has been a cyberattack victim. In 2010, the Stuxnet virus struck Iran’s Natanz uranium enrichment plant, manipulating its computers to send its centrifuges spinning at dangerous speeds. That incident occurred in the lead-up to an Iranian presidential election, and media reports later attributed Stuxnet to the US and Israel.Late to the game

    As the scale and complexity of malware has exploded in recent years, cyberwarfare has emerged as a new front in the battle to gain geopolitical supremacy. Governments and companies are scrambling to stay ahead of hackers and protect vital assets and resources.

    But maintaining adequate cyber defenses is costly, as systems must be constantly updated to stay ahead of hackers as they innovate.

    The industry has yet to agree on common standards, though trade associations, such as the International Association of Oil & Gas Producers and US refineries group American Fuel and Petrochemical Manufacturers have fostered discussion among their members, in concert with governmental bodies.

    However, oversight is uneven and restricted by an inability for national governments and companies to keep pace with the rapid development of malware threats, consultancy Oxford Analytica said in a recent report.

    Many governments are already late to the game and hampered by a skills shortage.

    “Although leaders might acknowledge the growing importance of the issue, few understand how to proceed,” the report said.

    Also troubling is a growing relationship between state actors and criminal groups, with countries providing funding to low-level cybercriminals, as well as access to sophisticated hacking resources via encrypted dark web sites.

    “I think what’s interesting that we’ll see in maybe five, 10 years’ time is the nexus between organized crime, terrorist organizations and hackers on the dark web,” Chatham House’s Unal said.

    In the past, cyberattacks on oil facilities typically involved cybercriminals seeking proprietary information such as production levels, which they could use for market manipulation, said FireEye’s Krotofil. But attacks in recent years have become far more sinister, ambitious and potentially destructive.

    Cyberattacks “have become much, much more complex, much more dramatic,” she said. “Attackers right now are trying to attack everything and see how far they go.”

    It is a risk that oil and gas producers can no longer ignore.

    http://blogs.platts.com/2018/08/13/insight-oil-companies-scramble-stay-ahead-cybersecurity-threats/
    

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Environment News

15. EPA Sends Another Wood Stove Rule for White House Review

    Aug 13, 2018 | E&E Greenwire

    By Sean Reilly

    EPA wants to take another look at the procedures wood stove manufacturers are required to follow in testing new model lines, according to a summary of a pre-rule now under review by the White House Office of Management and Budget.

    With the pre-rule, which was sent to OMB's Office of Information and Regulatory Affairs on Friday for a standard assessment, EPA is seeking comment on industry concerns, according to the Reginfo.gov website.

    The proposal is the second move this month related to EPA's 2015 update to emissions standards for new wood-fired heaters. The final compliance date for those standards is May 2020. Under a draft rule sent to OIRA on Aug. 3, EPA is proposing to let retailers keep selling models made before that date for an unspecified period of time afterward, according to a synopsis (E&E News PM, Aug. 6).

    The 2015 update was the first since EPA issued the original emission standards in 1988. At the time, agency officials predicted the tighter regulations would produce at least $3.4 billion in annual health savings stemming from reductions in premature deaths and other factors in return for $46 million in yearly compliance costs (E&E News PM, Feb. 4, 2015).

    But the industry now says it need more time to fully comply. After passing the House in March, H.R. 1917, which would push back the 2020 deadline until May 2023, is still awaiting Senate action.

    Also pending are legal challenges brought by two trade groups, the Hearth, Patio and Barbecue Association and the Pellet Fuels Institute. Although now more than 3 years old, the consolidated litigation has yet to reach the briefing stage, in part because of delays related to last year's change in administrations.

    In April, the U.S. Court of Appeals for the District of Columbia Circuit agreed to EPA's motion to extend the briefing timetable by another five months to give the agency time to work on changes to the 2015 standards. The challengers' briefs are now due by Sept. 20; final briefs are supposed to be filed by next February, according to the court's order.

    https://www.eenews.net/greenwire/2018/08/13/stories/1060093957
    

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16. Zinke on California Fires: 'This Is Not a Debate About Climate Change'

    Aug 13, 2018 | The Hill - E2 Wire

    By Miranda Green

    Interior Secretary Ryan Zinke said climate change had "nothing to do" with California's wildfires, as he visited neighborhoods hard hit by the massive Carr Fire over the weekend.

    “I’ve heard the climate change argument back and forth. This has nothing to do with climate change. This has to do with active forest management," Zinke told Sacramento station KCRA.

    It's a tone the Interior secretary struck throughout his visit to Redwood, Calif., where, alongside Department of Agriculture Secretary Sonny Perdue, he met with local officials and fire crews battling the wildfire. 

    Zinke echoed President Trump in his assertion that active forrest management -- including logging -- is the key to stopping the forest fires. 

    "It doesn’t matter whether you believe or don’t believe in climate change. What is important is we manage our forests," Zinke told reporters while visiting the Whisteytown National Recreation Area Sunday. “This is not a debate about climate change. There’s no doubt the (fire) season is getting longer, the temperatures are getting hotter.”

    The Interior secretary blamed environmentalists for having their own agenda in keeping officials from logging -- a method he said would remove much of the fuel fed to fires.

    "America is better than letting these radical groups control the dialogue about climate change," Zinke told KCRA. "Extreme environmentalists have shut down public access. They talk about habitat, and yet they are willing to burn it up.”

    Zinke's argument runs counter to a number of California officials and environmentalists who say the underlying factor responsible for the state's expanded fire season and acres burned each year is drought caused by global warming.

    “California has some of the strongest environmental laws in the country, but the impact of extreme drought conditions caused by climate change are intensifying wildfires,” Rep. Mark DeSaulnier (D-Calif.) wrote in a op-ed for The Hill on Friday. “Contrary to his tweets, the Trump administration’s anti-environment policies, not California’s pro-environment reforms, will make matters worse and hurt our planet for generations to come.”

    Zinke pushed both the safety and economic benefits of logging in areas like Redding.

    "The irony is we have billions of board feet that is rotting on our forest floor, where we are importing lumber, and that lumber could be better utilized for people to build houses, lower the price and make it affordable for people to build a home," Zinke told KCRA.

    Environmentalists say Zinke's argument, heavily peddled by Republicans in western states, focuses on pleasing the timber industry rather than focusing on curbing wildfires. They argue that cutting down the mature timber favored by logging groups will actually speed up the spread of fires.

    Randi Spivak, public lands program director at the Center for Biological Diversity, said the administration is missing the main issue by being dismissive of climate change's effect on the fires.

    "Climate change, creates drought, high wind conditions, low humidity. Fire creates its own weather," she said. "You can thin all you want till the cows come home but fire will overtake that.. what is misleading is people like Zinke and other people who refuse to talk about climate change and how we need to tackle that."

    http://thehill.com/policy/energy-environment/401550-zinke-on-california-fires-this-is-not-a-debate-about-climate-change
    

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