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Good morning and welcome back to Generate, where your host is happy to have contributions today from talented Axios colleagues Amy Harder (who will be a regular) and Shannon Vavra. You can find them both on Twitter at @amyaharder and @shanvav. Let's dive in...

Notes from the oil patch

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Wait, did the movie There Will Be Blood (the source of the GIF above) really come out 10 years ago? That went by fast. Anyway, here's a a few tidbits about oil powerhouses caught my eye over the last day . . .

Chevron: CEO John Watson chatted with the Columbia Center on Global Energy Policy for their latest podcast.

  • Tepid on Paris: Watson's public stance is kind of meh. He doesn't align with conservatives calling on the U.S. to bail outright (a stance that appears to be losing political ground), but he doesn't praise the accord like some of his peers in the Big Oil CEO club. "It's a beginning, but we need to understand a lot more about the commitments, about how we are going to have certainty, and what the costs of those commitments are, particularly to the U.S. government and to the U.S. consumer," he said of the climate accord.
  • NAFTA: His message to policymakers is don't mess with it too much, because it has been good for all three nations involved. "It creates jobs and creates well-being in all three countries."
  • Permian basin drilling: He's psyched about it. The roughly $2 billion in Permian investment planned in 2017 "could grow in future years."

Shell: The BBC has the latest on leaked recordings and internal emails that have surfaced in recent days about the oil giant's 2011 deal to secure access to a promising oilfield off Nigeria's coast.

  • "Shell has admitted for the first time it dealt with a convicted money-launderer when negotiating access to a vast oil field in Nigeria," the BBC reports. BuzzFeed and the Italian newspaper Il Sole 24 Ore reported on the murky deal and the investigations into it.

Russia and America: "In a crazy twist of international events, Russia's state-owned oil company Rosneft might end up owning Citgo, a US energy company based in Houston, Texas," CNN reports on the complicated arrangement. It hinges on whether Citgo's parent company, the Venezuelan state oil giant PDVSA, can repay a loan to Rosneft.

  • "In hotly worded letters to the Trump Administration in recent days, members of Congress and senators warned that it could be a big problem for US national security if Russia gets a hold of Citgo," CNN notes.

From Amy’s notebook: Calling the bluff on carbon taxes

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Get up to speed: Yesterday Axios energy reporter Amy Harder explored one of the biggest barriers to carbon taxes gaining any political traction: the refusal of Democrats and green groups to trade away regulations in return, and the refusal of Republicans and industry to accept EPA climate rules on top of a tax.

Now she's got a little more on that topic …

One level deeper: David Bookbinder, former chief climate counsel for the Sierra Club and now a fellow at the right-leaning Niskanan Center, which advocates for a carbon tax, says there's more than meets the eye when it comes to the carbon tax versus climate regulations debate.

What he's saying: Environmental groups publicly say they wouldn't trade climate regulations at the Environmental Protection Agency for a carbon tax, but privately the groups say they would if the price is right, Bookbinder asserts.

  • "Like most entities that have no experience in actual negotiations, they [environmental groups] believe that they can't say publicly that they will make the trade until the R's put the tax on the table," Bookbinder tells Axios.
Our thought bubble: At least one side is going to have to be the first to show a willingness to compromise privately and eventually publicly to break the logjam that is this perennial carbon tax debate. So far, that's not happening. A spokesman for the Sierra Club declined to comment on the record about their official position, which is that they wouldn't support a trade of EPA regulation for a carbon tax.

U.S. carbon footprint shrinks—again

Data: Energy Information Administration; Chart: Andrew Witherspoon / Axios

U.S. carbon emissions from energy dropped another 1.7 percent in 2016, largely because natural gas and renewables are displacing coal in power production, data from the federal Energy Information Administration shows.

Why it matters: It's a clear signal that President Trump's effort to revive the coal industry's fortunes by cutting regulation is an uphill battle against underlying market trends.

  • Emissions from electric power fell by almost 5 percent. Total CO2 emissions are around 14 percent below 2005 levels, putting the U.S. roughly halfway toward meeting its pledge under the Paris climate accord to cut emissions by 26-28 percent by 2025.
  • The emissions drop last year was smaller than the 2.7 percent decline between 2014 and 2015. Energy accounts for nearly all U.S. carbon emissions.

To be sure: Not everything is trending downward. Emissions from transportation rose by almost 2 percent last year as vehicle travel increased amid low gasoline prices. Transportation overtook the electricity sector as the largest U.S. carbon emissions source in 2016, according to EIA.

What happens in Rome

From the Axios stream, my colleague Shannon Vavra summarizes coverage from Italy about what did and didn't happen when Energy Secretary Rick Perry went to Rome for the G-7 meeting of energy ministers . . .

No comment: The U.S. delegation to the G7 was the only country not to sign a draft joint-statement that included a commitment to follow the Paris climate agreement's provisions, according to the AP. As a result, the group didn't issue a statement at all.

Why the U.S. didn't sign: It's still reviewing its position, per the Italian development minister. Energy Secretary Rick Perry also wanted to include references to coal and fossil fuels in the statement, Reuters reports.

Thanks Shannon! Here's a bit more . . .

Not business as usual: The unusual absence of a communique from the meeting signals how the lack of a White House position on the Paris climate agreement is starting to percolate into diplomacy.

The suspense won't last forever though. White House press secretary Sean Spicer said recently that the U.S. plans to announce its plans ahead of the late May G-7 meeting that Trump will attend.

  • The headline of Bloomberg's piece on Perry's Italian adventure adds some drama: "Trump Faces Showdown With G-7 Over Climate Stance Next Month."

Tesla and Trump

Tesla CEO Elon Musk is among the executives who will meet with President Trump at the White House on Tuesday. Mike Allen sets the stage in Axios AM this morning. Speaking of Tesla ...

Worth a lot: On Monday, trading sent the electric vehicle and solar company's valuation past GM to make it the most valuable U.S. automaker, Reuters reports.

Kim Hart sizes up the news and injects some caution over in the Axios stream.

Bubble? Over at Business Insider, Matthew DeBord argues that "none of this makes any sense. The Los Angeles Times notes that the company's surging valuation puts an even more intense spotlight on the company as it prepares to launch its Model 3 sedan later this year.
  • "The propulsive rise in Tesla's stock — up more than 70% since December — amps up the pressure on the company and its visionary chief executive, Elon Musk, to deliver near-flawless performance," their story states.

Thanks for reading! Please keep the tips and feedback coming to ben@axios.com.

Featured

Silicon Valley hasn't forgotten about Sci-Fi

Lazaro Gamio / Axios

Back in 2011, investor Peter Thiel's VC firm, Founders Fund, published on its website: "We wanted flying cars, instead we got 140 characters."

We may have gotten 140 characters first thanks to Twitter, but flying cars are certainly still in Silicon Valley's plans.

Why it matters: Silicon Valley is often criticized for pouring capital into startups building luxury products for the 1% or yet another photo-sharing app, but it's also going after much more ambitious goals. Often, these ambitions seem straight out of a science fiction novel, and yet some of the biggest tech companies are heavily pursuing those projects.

  1. Flying cars: Vertical take-off and landing (VTOL) aircrafts—or "flying cars"—are nothing new to the imagination of tech enthusiasts. But in recent years, a growing number of companies, including Uber and the Larry Page-backed Kitty Hawk, have started to seriously work on making it a viable transportation option someday.
  2. "Curing" death/Curing all human diseases: It may sound like science fiction, but significantly extending human life is a very real goal in which companies like Alphabet are investing. Meanwhile, Mark Zuckerberg and wife Priscilla Chan announced over a year ago that they'll be putting their fortunes toward curing all human diseases.
  3. Typing with your brain/hearing with your skin: Not content with just making social media apps, Facebook has taken up developing technology that would let people type using their brain waves and "hear" through their skin. In a way, it's not hard to see how these technologies would fit with the company's mission to help people connect with each other.
  4. Settling on Mars: For decades, rocket ships were the domain of governments, and were used for scientific exploration. But today, companies like Elon Musk's SpaceX and Richard Branson's Virgin Galactic not only want to make space travel a commercial option, but some have set their sights on going to Mars.
  5. Meatless meat/food: Some startups like Hampton Creek are replacing eggs with plants, while others like Impossible Foods want to feed you meatless burgers. With changes in populations, agriculture, and foods, it's no surprise that a slew of companies are looking to provide non-animal alternatives.
  6. Wireless charging: Scientists have been skeptical as to whether startups like uBeam can make charging devices wirelessly a reality, but top Silicon Valley names like Marc Andreessen are convinced. Earlier this year, uBeam founder Meredith Perry showed off her company's tech at a conference in Los Angeles, though she's yet to provide an in-depth demo to the press.
Featured

Trump drums up accomplishments in campaign-style speech

Patrick Semansky / AP

On his 100th day in office, President Trump spoke for an hour in Harrisburg, Pa., outlining what he's done in office, while rehashing campaign talking points.

Is there any place like a Trump rally?

Accomplishments cited: Foreign relationships (Germany, Japan, China, and UK mentioned), Gorsuch appointment, TPP withdrawal, Buy American, Hire American executive order, bullish stock market, green light for Keystone and Dakota Access Pipeline construction, scrapping regulations, reduction in illegal border crossings, 28 bills passed, and return of Egyptian-American prisoner Aya Hijazi.

Explaining decision not to label China a currency manipulator: "China is helping us possibly or probably with the North Korean situation, OK? Which is a great thing."

Campaign déjà vu:

  • "We are going to keep radical Islamic terrorists the hell out of our country."
  • "We will repeal and replace Obamacare, you watch."
  • "We will renegotiate NAFTA."
  • "The previous administration gave us a mess."
Featured

Trump: Don't compare my health care plan to Obama's

Carolyn Kaster / AP

President Trump suggested tonight that it's not fair to compare the Republican health care plan to the Affordable Care Act, because the law is "dying, dying, dying" and won't be around anyway. "They always like to compare — well, what about [Obamacare]? Obamacare's dead," Trump said at a rally in Harrisburg, PA. "It's gone ... The insurance companies are fleeing."

Between the lines: His comments suggested that he might try to use the law's problems — including the steep premium hikes last year — to dismiss the comparisons people are making to the GOP replacement plan, which aren't flattering. The biggest criticisms: it would cover 24 million fewer people than the ACA, and under some of the latest changes, it might not give the same protections to people with pre-existing conditions.

Pass the "damn thing": "I'll be so angry at Congressman [Mike] Kelly and Congressman [Tom] Marino and all of our congressmen in this room if we don't get that damn thing passed quickly." (He later gave them a "just kidding" wave: "They'll get it done.")

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Samantha Bee imagines the U.S. with Hillary as President

TBS

This afternoon TBS's Samantha Bee hosted her special edition of Full Frontal — Not the White House Correspondents' Dinner. She roasted CNN and Fox News as well as presidents Woodrow Wilson, Ronald Reagan, Richard Nixon and George W. Bush — played by Will Ferrell who Bush recently praised for his SNL impressions on him. But of course, Donald Trump got the most of the roasts.

The last act imagined a world in which Hillary Clinton was president.

The agenda: Opening the show, in a pre-recorded clip of Allison Janney playing the White House Press Secretary taking questions from internet trolls, Janney is asked if Ms. Bee was trying to undermine President Trump and the press with her event. Janney replies, "No, she's trying to undermine just one one of those." To which the crowd erupted in cheers and laughter.

The kicker: The event took place in D.C. on the same day as the official White House Correspondents Dinner, which Donald Trump and his White House refused to attend.

The puzzler: Barack Obama was notably left out of the roasts.

Featured

Ohio lawmakers might freeze Medicaid enrollment, defying Kasich

Ron Schwane / AP

Ohio's John Kasich is one of the most famous Republican governors to expand Medicaid, but GOP lawmakers weren't thrilled — and now they're looking at freezing Medicaid enrollment so they can pass the state budget, the Associated Press reports. "With Medicaid being such a huge issue in our budget, our answer can't be to put more people on," said state Rep. Larry Householder, who supports the freeze.

The takeaway: Even GOP governors who went along with the expansion under the Affordable Care Act can't always maintain support within their party. If the freeze passes, it will put pressure on Kasich to show how deeply committed he is to the expansion.

Featured

Paul Manafort's foreign agent saga continues

Carolyn Kaster / AP

Mercury LLC, a Washington-based lobbying firm under Paul Manafort's direction, registered as a foreign agent yesterday, per the AP. They lobbied for and set up meetings with Ukrainian political officials in an attempt to influence the campaign based on their pro-Russian interests, specifically for former Russian President Yanukovych.

Flashback: Earlier this month, Manafort was reportedly registering as a foreign agent, his spokesman James Maloni told AP. But yesterday, Maloni said that is no longer happening, despite what he said before.

Manafort's role: The registration revealed that he was involved with the firm's lobbying work, attending meetings and offering consulting. One meeting (of the four he attended) was with Rep. Dana Rohrabacher of California — in 2014, after the meeting, he voted against an aid package intended for the government that replaced Yanukovych's, per AP. Furthermore, Manafort and Rick Gates, another Trump campaign aide, directed certain tasks for Mercury, making their lobbyists set up meetings with various Ukrainian senators and political officials.

What's next: Manafort still needs to formally disclose his involvement with foreign, pro-Russian lobbying firms, so he's considering other options after receiving guidance from the federal authorities about that.

Featured Facts Matter

How the WHCD became a celebrity affair

Evan Agostini / AP

The issue:

The 2017 White House Correspondents' Association dinner will go on, despite President Trump, all White House staff, and many celebrities declining the invitation. It has evolved significantly over the years, so how did it originate?

The facts:

The WHCA was founded in 1914 after there were (false) rumors that President Woodrow Wilson was selecting a small group of reporters to attend his press briefings. The association held their first dinner in 1920, and four years later, President Calvin Coolidge attended.

The 1987 dinner had the first "celebrity" guest, according to the Washington Post, when Baltimore Sun correspondent Michael Kelly invited the beautiful administrative assistant Fawn Hall, who was involved in the Iran-Contra affair. This inspired a trend of inviting the most "newsworthy" or intriguing person whom reporters would want to talk about, making the dinner a Hollywood affair.

Why it matters:

Skeptics have said the event — where reporters party with government and are made celebrity-like — isn't journalistically kosher. For better or worse, it's become a tradition, which Trump has now broken... for this year, at least.

Featured

Fox in a box

Richard Drew / AP

The profitable, influential, seemingly impregnable Fox News is suddenly vulnerable.

In a massive disruption for right-wing media, Fox talent is on the market, the purge of the old-boy clique may continue, and there's huge internal paranoia about further lawsuits and revelations.

On top of that, there are episodic pushes from the next generation of Murdoch leadership for changes in culture and personality.

So at a time when all of cable is vulnerable as viewer habits change, Fox is caught between the America-first instincts of its base viewers, and the globalist impulses for Rupert Murdoch's sons.

A woman to run Fox News? The Hollywood Reporter reports that James and Lachlan Murdoch have quietly put out feelers for a new head of Fox News to replace Bill Shine, the Roger Ailes consigliere.

"[T]he preference ... is that the new leader be female."

And competitors are moving to take advantage:

  • Mediaite reports that "an alternative conservative network is being actively discussed amongst conservative fat cats": "[S]erious discussions are underway to create an alternative conservative cable network on the belief that the Fox News Network is moving too far to the left. ... The potential aim? Putting 'the old band' back together."
  • "Sinclair Broadcasting [home of Sharyl Attkisson] expands its footprint," by Axios' Shannon Vavra and Sara Fischer: "[N]ew hires and acquisitions around the U.S. come at an optimal time to snatch up conservative audiences; TheBlaze and Fox News just let go of their star anchors, Tomi Lahren and Bill O'Reilly."

Why it matters: Reinvigorated conservative media could help Trump as he heads toward midterms and a reelection race, with outlets scrambling to lock in Trump Nation with boosterish coverage.

Featured

Trump's bizarre obsession with the election map

Lee Jin-man / AP

President Trump wanted to celebrate his 100th day in office with an image of the 2016 electoral map displayed on the front page of the Washington Post. "He encouraged me to take it home to my colleagues at the Washington Post and try to run it on the front page of our newspaper," said WaPo's Washington Correspondent Philip Rucker during a MSNBC interview Friday.

Why it matters: It has been five months since the election and 100 days since Trump was sworn in as president, yet he continues to have a bizarre, never-ending obsession with how many electoral votes he received — with copies of the electoral map ready to present to anyone who will listen.

Trump in 2012: "The electoral college is a disaster for a democracy." And then in 2016:

The Electoral College is actually genius.
-Trump

Understanding the origin of his obsession

  • Exactly one week after the election, Trump tweeted: "The Electoral College is actually genius in that it brings all states, including the smaller ones, into play. Campaigning is much different!" (See GIF below for how that played out.)
  • This was seemingly the first time he recognized the EC as another intriguing layer to his hyper-competitive participation in the election — it became a challenge to overcome, something else to win.
  • "I did what was almost an impossible thing to do for a Republican-easily won the Electoral College!" He then considered his feat an even greater win, thus strengthening his obsession.
  • Big league accomplishment: "Campaigning to win the Electoral College is much more difficult & sophisticated than the popular vote. Hillary focused on the wrong states!"

Reddit/Giphy

One-track mind

For Trump, there's never a wrong time to cite his electoral college victory:

  • When asked about the rise of anti-Semitism during a February presser with Israeli PM: "Well, I just want to say that we are very honored by the victory we had. 306 Electoral College votes. We were not supposed to crack 220."
  • During a joint presser with Canadian PM Trudeau, he was asked about deporting Syrian refugees and said, "That's what I said I would do. I'm just doing what I said I would do, and we won by a very, very large electoral college vote."
  • In the middle of discussing Chinese President Xi Jinping with three Reuters reporters, Trump handed them three copies of the election map he had printed out that were sitting atop his desk in the Oval Office. "Here, you can take that, that's the final map of the numbers. It's pretty good, right? The red is obviously us."
  • He gave a speech to the NRA yesterday, the first POTUS to do so since Raegan, and spent the first portion of it talking about his electoral college victory. He listed the states he won, touted his 306 (actually 304) EC votes. "Big sports fans said [the election] was the single most exciting event they're ever seen."
  • 5 minutes into his speech at a Louisville rally in March, Trump called Nov. 8 "a beautiful day" adding "they weren't giving us a chance, saying, 'There is no way to 270.' ...And you remember for the Republicans, the Electoral College has been very, very hard to win."
Featured Facts Matter

Why big oil companies are leaving Canada

The issue

Big international oil powerhouses (ConocoPhillips, Statoil, Shell) are pulling out or retreating (ExxonMobil) from their Canadian oil sands investments — a seemingly counterintuitive strategy given that the Canadian oil sands are the third largest reserve of crude oil in the world.

The facts

They're reconsidering to save on costs. The oil sands in Canada have some of the highest operating costs in the world paired with low profits. Plus, Canadian oil sands have greenhouse-intensive sources of crude oil and have limited pipeline access to markets, which leaves little flexibility for oil companies.

Instead, some big oil is seeking out lower-cost and higher-stability operations in the Permian Basin in New Mexico and Texas, the second largest oil field in the world whose crude production increased in all but three months last year. Crude oil is expected to increase to 2.4 million barrels per day in May, according to the EIA.

ExxonMobil, Shell, and Chevron (also considering leaving the Canadian oil sands) are already in on these advantages — they invested $10 billion this year in the Permian Basin. ConocoPhillips has legacy acreage in the basin, and is likely to increase production this year, too, per The Motley Fool.

Why it matters

Companies' departure from Canada's oil sands came as a shock on Wall Street, but it is becoming more common.

Plus, this will shift international energy dynamics: Saudi Arabia, which has the largest oil field in the world ahead of the Permian Basin, could be weakened by this competing investment. And many of the Canadian companies now have room to nudge into their own oil sands and consolidate their ownership, giving them a competitive edge.