"The world's most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money."
Matt Taibbi's memorable description from his 2009 Rolling Stone article has stuck with the giant investment firm Goldman Sachs, but it hasn't stopped them from seeking the latest opportunity to make another bucket of money.
One such opportunity for them has been the proposed Gateway Pacific Terminal in Cherry Point, WA. The terminal, if permitted, will export 48 million metric tons of Wyoming coal to China. Goldman Sachs, as the 49% investor in the Carrix Corporation, was one of two large investors in the planned terminal. The proposal has been fiercely opposed throughout the region for reasons ranging from local impacts to serious concerns about climate impacts.
As Inspector Clouseau would say: "Not any more."
Yesterday it was announced that Goldman Sachs will be looking for new places to put their blood funnel - they have sold their entire investment in the coal terminal.
There are several factors that may have led Goldman Sachs to this decision. One could have been that the market for coal export has been looking grim.
This summer, Goldman Sachs themselves warned that the window for coal exports may be drying up. Quoth the squid:
We believe that thermal coal’s current position atop the fuel mix for global power generation will be gradually eroded by the following structural trends: 1) environmental regulations that discourage coal-fired generation, 2) strong competition from gas and renewable energy and 3) improvements in energy efficiency. The prospect of weaker demand growth (we believe seaborne demand could peak in 2020) and seaborne prices near marginal production costs suggest that most thermal coal growth projects will struggle to earn a positive return for their owners.At the same time, they were major investors in - yep - a major proposed coal export terminal.
So how long was that situation going to last? Usually, Goldman Sachs manages to keep selling investments that they know are crap, rather than continuing to hold the bag.
And today, the other shoe dropped. Floyd McKay of Crosscut explains:
Goldman may have become impatient with the length of proceedings to secure permits for the $664 million project; intense public opposition, particularly along the thousand-mile rail line from Wyoming, has caused public agencies to call for an intense and lengthy environmental review. Additionally, November’s election in Whatcom County put a new majority on the county’s governing board that is at least skeptical of the coal port and certain to pose detailed questions when asked to approve permits.The proposed coal terminal is not dead - yet. Another investor, Mexican tycoon Chico Pardo, has stepping in to pick up Goldman's stake. It's just a telling sign when one of the biggest investment banks in the galaxy decides to pick up their marbles.
It matters - a lot - whether these large fossil fuel projects can get financed. When a large piece of infrastructure gets built, it tends to continue to operate for years. This Capital Lock In will create climate damage for decades. This is a big reason for divestment campaigns led and inspired by 350.org.
But maybe this is the start of something bigger - the start of really large corporations deciding, on the cold hard facts of the matter, the fossil fuel investments are a bad idea.
Any time you think you have to do something that's wrong, you don't.
Not Any More
We shall not participate in our own destruction.
Previous entries in this series, in chronological order first to most recent:
We shall not participate in our own destruction
Pretty much the dumbest idea ever
Can a community defy a cabal of multi-national corporations?
Great for the coal cabal! For us, not so much
And So it Begins
Right Brain for This Decision?
101 Reasons to be Concerned About Coal Export
On Refusing to be Rounded out of Existence
Who Are the Welfare Queens Now?
There Is No Daylight
Tis the Season to Decide Our Future
They've Got the Money. We've Got the Humans!
The House of Actual Reality
Collision With Reality
Climate Change and Coal Export - Taking Responsibility
Corps of Engineers Designs Henhouse, Excludes 99 Percent of Chickens
Outsourcing Carbon Pollution: Not So Fast!
Your chance to speak out on a plan that will cause Gigaton level CO2 emissions