Looking for capital to construct a natural gas pipeline? Don’t look to Minneapolis-based U.S. Bancorp, parent of U.S. Bank.
And for hydraulic fracturing (fracking) or oilsands exploitation, prepare to be scrutinized closely before the bank agrees to do business.
“The company does not provide project financing for the construction of oil or natural gas pipelines,” said U.S. Bancorp’s 2017 Environmental Responsibility Policy, which was released in April. “Relationships with clients in the oil and gas pipeline industries are subject to the bank’s enhanced due diligence processes…”
Unconventional oil/natural gas production (fracking, oilsands, Arctic, Alaska, offshore) as well as coal mining, forestry, metals mining and power generation (nuclear, coal, hydroelectric) all will engage enhanced due diligence by the bank, it said.
If the bank doesn’t like natural gas or oil, it seems to dislike coal more. Those engaged in mountaintop removal mining are mostly unwelcome. Further, “the company prohibits direct project financing of coal-fired power plants and relationships that involve constructing such plants.”
The new U.S. Bancorp stance on energy infrastructure drew a rebuke from the Energy Equipment & Infrastructure Alliance (EEIA), which called for a reversal of the policy in a letter to the bank.
“U.S. Bancorp’s new anti-pipeline policy is discriminatory and an insult to hard-working men and women of the U.S. energy infrastructure and fossil fuels industry,” said EEIA CEO Toby Mack. “U.S. Bancorp’s policy will negatively impact businesses of all sizes in the energy supply chain, more than 90% of which are local and regional small businesses. EEIA calls on U.S. Bancorp and U.S. Bank to immediately rescind its misguided and discriminatory policy.”
In its policy the bank said it does want to increase investments in renewable energy, including wind, solar, geothermal, biomass, biofuels, waste recycling, and waste energy recovery/conservation systems, it said.
“Environmental sensitivity is an important component of our credit, investment, underwriting and payment procedures and is integrated into our overall risk management philosophy...Most importantly, our oversight of customers incorporates awareness of the environmental impact they have, including our customers from the energy sector.”