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This Week in Texas Energy: Texas Politicians Push Trump to Reduce Ethanol Mandate

Plus: Rick Perry returns from Saudi Arabia, Sen. Cornyn slips a little something nice for big oil into the tax bill, and Exxon opens its first gas stations in Mexico.

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Senate majority whip John Cornyn talks to reporters at the U.S. Capitol November 30, 2017, in Washington, DC.
Chip Somodevilla/Getty

Ethanol Blues

Senators Ted Cruz and John Cornyn joined other Republican senators in a meeting with President Donald Trump on Thursday to pressure the president to pull back a federal ethanol mandate created to reduce the nation’s thirst for oil, according to the Houston Chronicle. The Environmental Protection Agency said earlier this year that it would be increasing the amount of biofuel that must be blended into gasoline for next year and wouldn’t bend to requests to change the mandate from Republicans from oil-rich states. In October, Cruz, Cornyn and seven other Republican senators penned a letter to Trump asking to meet to “discuss a pathway forward toward a mutually agreeable solution” on the biofuel mandate. “If your administration does not make adjustments or reforms on matters related to the renewable fuel standard,” the senators wrote, “it will result in a loss of jobs around the country, particularly in our states.” They got that meeting on Thursday. Trump, Chief of Staff John Kelly, EPA chief Scott Pruitt, Agriculture Secretary Sonny Perdue, Deputy Energy Secretary Dan Brouillette, and Trump economic adviser Gary Cohn, as well as eleven senators, including Cruz and Cornyn, were at the meeting, where Trump encouraged senators to find a solution that was “win-win” for everyone, including refineries, biofuels producers, and consumers, a lobbyist briefed on the meeting told the Chronicle. “We had a productive meeting today with the president to discuss how to fix the compliance problem in a way that protects both refinery workers and corn farmers,” Cruz and other senators said in a statement.

Rick of Arabia

Energy Secretary and former Texas Governor Rick Perry returned from a weekend trip to Saudi Arabia earlier this week, and pictures from his trip quickly surfaced, showing Perry certainly made the most of his visit. Photos showed Perry holding a hawk, visiting food stands, and posing with Saudi Minister of Energy, Industry, and Mineral Resources Khalid al-Falih while wearing traditional Saudi dress and holding a sword. A photo also surfaced showing Perry sitting barefoot in the country’s sand dunes, the sun hanging low in the hazy background. His time there wasn’t entirely a photo op, though. Perry also met with Saudi officials, including King Salman and Crown Prince Mohammed bin Salman, to talk about fossil fuels, according to Al Arabiya. “It was an honor to meet His Royal Highness Crown Prince Mohammed bin Salman,” Perry wrote in a tweet after his visit. “Glad to build on the strong relationship between the United States and Kingdom of Saudi Arabia.”

Nice Deal

Senator John Cornyn introduced a last-minute provision in the pending GOP tax bill that would give oil companies a huge break. According to the International Business Times, Cornyn’s amendment would allow oil and gas firms that are publicly traded partnerships to benefit from a tax bill provision allowing a deduction for pass-through businesses on their income, per Business Insider. Many energy companies are classified as master limited partnerships, a type of publicly traded partnerships. As the Business Times notes, many of the fossil fuel firms operating MLPs are based in Texas and have given financial support to Texas Republican lawmakers such as Cornyn and Ways and Means Committee chairman Kevin Brady. Donors from Valero and Energy Transfer were among Cornyn’s top donors in 2016, and that same year, Brady got more money from Energy Transfer Partners than all but one other congressman.

New Digs

Exxon Mobil will open its first gas stations in Mexico this week, according to the Houston Chronicle. The Dallas-based energy giant will open up eight Mobil-branded stations in the area of the central Mexican city Querétaro, part of the company’s plan to become a major Mexican fuel supplier. Exxon will open about fifty fueling station in central Mexico within the next three months, and has committed to spending $300 million to bring its fuel logistics services and gas stations south of the border. “The opening of these first eight Mobil service stations, made possible by Mexico’s new energy policy regime, is a significant milestone for the country and our company,” Carlos Rivas, fuels director for Exxon Mobil in Mexico, said, according to the Chronicle. “We look forward to helping meet the country’s growing demand for energy with a reliable supply of high-quality fuels and a positive customer experience.”

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