JP Morgan Chase coal issues

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This article is part of the Center for Media & Democracy's spotlight on global corporations.

JP Morgan Chase coal issues is a subsection of the main SourceWatch article JP Morgan Chase.

Coal financing

In November 2011, JP Morgan Chase was listed as the top global financier of coal-fired power plants in a report complied by various environmental groups entitled, Bankrolling Climate Change: A Look into the Portfolios of the World's Largest Banks. The report noted that JP Morgan spent $11,095 million euros on coal plants around the world since 2005.[1]

Coal plant investments

JP Morgan Chase is a major financier of new coal plant construction. New coal-fired power plants in the U.S. being funded by the company include:

Mountaintop removal funding

Chase Bank Die In - RAN Chicago, April 2010.

JP Morgan Chase is also a major financier of coal mines, including environmentally destructive mountaintop removal (MTR) practices. In 2009, JP Morgan Chase helped finance $600 million for Arch Coal, which that year mined 4.7 million tons of coal using MTR. In 2008, JPMorgan acted as lead manager on a $690 million bond offering by Massey Energy, which leads the nation in MTR mining. Between 2000 and 2006, Massey violated the Clean Water Act more than 4,500 times by dumping sediment and leftover mining waste into rivers in Kentucky and West Virginia, the EPA said in 2008, although environmental groups say this is a conservative estimate.[2]

According to Mother Jones:

"Over the past 17 years, JP Morgan Chase has helped to underwrite nearly 20 bond or loan deals, worth a combined $8.5 trillion, for some of the biggest players in the MTR mining business, according to data from Bloomberg. Other large banks have either halted financing companies engaging in the practice outright or signaled their intent to do so. In December 2008, for instance, Bank of America publicly announced plans to "phase out financing of companies whose predominant method of extracting coal is through mountain top removal."

[[Wells Fargo] has cut ties with coal giant Massey Energy. A Credit Suisse official says the bank has a "global mining policy" that ensures "we explicitly do not finance the extraction of coal in a mountaintop removal setting." But JP Morgan continues to back the practice.

By underwriting MTR, JP Morgan ties itself to some of the nation's biggest polluters. Amanda Starbuck, who leads the Rainforest Action Network (RAN)'s global finance campaign, says that if the bank is to satisfy its critics, "Nothing less than a blanket ban of mountaintop removal by Chase will suffice."[3]

On July 15, 2011, coal producer Xinergy Corp. reported that it had signed a long term supply agreement with J.P. Morgan Ventures Energy Corp. Under the agreement, a total of 2.16 million thermal tons of coal, or 720,000 tons a year, will be delivered from Jan. 1, 2012 through Dec. 31, 2014 from Xinergy's Raven Crest/Brier Creek mines in West Virginia. The Raven Crest property, which covers 12,262 acres of land with its two surface mines and one highwall mine, has 17.2 million tons of proven and probable reserves, of which 5 million are permitted. Xinergy said it will get a minimum of $170 million in revenue over the term of the agreement.[4]

Shareholder action on coal mining

Boston Common, Loyola University, and JP Morgan

At least two shareholder groups filed resolutions in 2010 highlighting JPMorgan’s support for mountaintop removal (MTR) mining. One of them, Boston Common Asset Management, a firm focusing on sustainable and responsible investing, called on the bank to publicly report on the impact of MTR mining by its clients, particularly Massey Energy and Arch Coal, as well as the financial impact on JPMorgan if it banned MTR financing. Boston Common later withdrew its resolution due to ongoing negotiations with JPMorgan officials, according to a Boston Common official.[5]

The other resolution, filed by Loyola University Chicago, demands that JPMorgan adhere to a 2008 agreement that JPMorgan signed on to called the “Carbon Principles,” an effort among big banks to improve environmental disclosures and ultimately shift more funding into green, sustainable projects. The pushback from the university grew out of a visit to MTR sites in Appalachia by Loyola students, who were shocked at the devastation wrought on the landscape and surrounding communities, says Elaine Lehman, a director of corporate relations at the school.[5]

Protests against coal investments

Chicago protest (April 2010)

On Friday April 2, 2010 activists associated with RAN in Chicago staged a "die-in" at a downtown JP Morgan bank to protest the bank's investment in MTR projects. Between thirty and forty people took part in the protest. None were arrested. It was RAN's first direct action campaign to pressure the company to abandon its MTR investments.

"JP Morgan Chase is on the run in this campaign and they are looking for a way to end this campaign," said RAN activist Adam Gaya. "(They are seeing that) people are willing to go beyond making a phone call and sending a email [and are] canceling their account and taking direct action."[6]

References

  1. Bankrolling Climate Change: A Look into the Portfolios of the World’s Largest Banks Earthlife Africa Johannesburg and BankTrack, 2011.
  2. Andy Kroll "JPMorgan’s War on Nature", Mother Jones, March 30, 2010.
  3. Andy Kroll "JPMorgan’s War on Nature", Mother Jones, March 30, 2010.
  4. Brad Lemaire, "Xinergy inks long-term coal supply deal with J.P. Morgan" Proactive Investors, July 15, 2011.
  5. 5.0 5.1 Andy Kroll, "JPMorgan’s War on Nature" Mother Jones, March 30, 2010.
  6. Kevin Gosztola "RAN Chicago Takes Action in Chase Tower, Calls Attention to Chase's Investment in MTR", Oped News, April 6, 2010.

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