Energy Transfer is Simply Bad Business
by Rodrigo Estrada
October 24, 2018
The company behind the Dakota Access pipeline is boasting about its recent merger. What does that matter when it continues using more of the same controversial practices?
© Katie Nelson / Greenpeace
October 19, 2018 was quite a day for Energy Transfer — allegedly. The company announced the completion of a merger between Energy Transfer Equity and Energy Transfer Partners, boasting a simplified structure and new plans to expand the Bakken pipeline system — that includes the sadly familiar names Dakota Access and Bayou Bridge pipelines.
What’s really happening?
Despite the company’s rosy press releases, few are buying into the empty promise of an improved company outside Kelcy Warren’s circle. For starters, a class action on behalf of Energy Transfer Partner’s unitholders was filed in the United States Court for the Northern District of Texas just as the company’s meeting to approve the merger adjourned — so it seems the merger is not really a done deal after all.
According to reports, the class action seeks an injunction and other remedies claiming the company “filed a materially incomplete and misleading proxy statement with the Securities and Exchange Commission in violation of the Exchange Act.” Such a move would significantly impair the unitholders’ ability to make an informed decision on the merger.
Well, unitholders aside, everyone is happy. Right?
Not really. Energy Transfer’s special meeting wasn’t just noticed by disgruntled unitholders in the Texas courts. A group of Indigenous leaders and other community representatives opposing the company’s controversial pipelines in North Dakota, Louisiana, Pennsylvania, and elsewhere showed up to ask questions during the unitholders’ session in Dallas.
BREAKING: grandmother & retired teacher Ellen Sue Gerhart disrupts @ETPfacts shareholder mtg. She was just jailed for 2 mos for peacefully opposing pipeline construction on her own property #stopETP pic.twitter.com/M0u1QDPAqJ
— Ethan Buckner (@ethanbuckner) October 18, 2018
Company execs didn’t like it one bit. Peaceful demonstrators were removed from the Hilton Dallas Park Cities and two Indigenous rights activists — Waniya Locke and Cherri Foytlin — were arrested and face charges of disorderly conduct. Do keep in mind that they were detained by two off-duty officers working at the meeting, according to a local police spokesperson.
There is a long, unsettling record of Energy Transfer’s excessive and racist reactions against those opposing its controversial pipelines across the country. From reports of security forces brutality on Indigenous Water Protectors at Standing Rock, to the appalling remarks from CEO Kelcy Warren about removing pipelines protesters from the gene pool.
Energy Transfer’s reckless attitude towards human rights, free speech, and the environment is a source of concern for investors and financial institutions as well. Recently, the international financial services company NN Group blacklisted Energy Transfer and other pipeline companies following reports of their behavior across North America.
So, is Energy Transfer listening now?
No. The company has shown no plans to slow down its operations despite ongoing conflict on the ground, lasting controversy, and the calls from its unitholders and investors for better corporate practices across the board.
Remember, hours after announcing the merger completion — actually not really complete until the U.S. District Court for Northern Texas rules on the class action on behalf of unitholder — Energy Transfer started a process to seek commitments from shippers to transport more oil through the Bakken pipeline system.
Provided the expansion would only entail “minimal asset modifications,” the two reported ways to increase its capacity are to add chemicals that make the crude lighter or to add horsepower. Regardless of the method, the risk for the communities, water, and the environment would increase.
What can we do?
Energy Transfer still benefits from support from a few financial institutions. You can join the voices of thousands around the world, ask banks like JPMorgan Chase to stop supporting companies like Energy Transfer.
Enough is enough.