When ETP announced it was going to refinance its debt last November, our ears perked up. Amid the resistance to Dakota Access, several of ETP’s lenders said they wouldn’t renew their loans. Now that the dust had settled at Standing Rock, would the banks follow through?
Neither ING nor DNB joined ETP’s new $5 billion credit deal, just as they had promised. But US Bank did, even though its brand new CEO had assured investors eight months prior that “just yesterday we updated our environmental responsibility policy to say that we do not finance construction of oil or natural gas pipelines.”
In fact, the policy didn’t say that. It said that US Bank doesn’t provide “project financing” for pipelines. And to the bank, that’s an important distinction. Project financing is backed by the value of the pipeline itself, whereas general financing is backed by the company building it. But from the vantage of water protectors, the difference is meaningless. The pipeline gets funded and built either way.
In short, US Bank’s new policy is an empty promise. According to public records, US Bank provides roughly $0 in “project financing” to oil and gas pipelines, but it has financed more than $1.4 billion for the companies that build them. By limiting the policy language to “project finance,” US Bank created the impression it was making a bold move, but nothing ever changed.