September 8, 2022
Issue 12  |  View Past Issues
Inside Gas
Published by Global Energy Monitor

Editor's Note

The mood music at this week’s Gastech conference in Milan, the biggest industry event in the calendar, is reported to have been complicated, and not just because of some spectacular activism pointing out the “climate hell” that gas dependency is unleashing. Gazprom’s indefinite closure of the Nord Stream 1 pipeline has further upped the stakes in Europe, and governments and companies are racing to respond as prices remain high and winter approaches fast.

The CEO of Italy’s Enel chose the moment to declare that Europe’s dependence on gas has been “foolish,” yet in London expert advice is once again being ignored as incoming prime minister Liz Truss is set to announce a host of new North Sea oil and gas exploration licenses and an immediate end to the UK’s ban on fracking that’s been in place since 2019. 

Gas industry duplicity has been exposed by a South African judge ruling in favor of communities who were not properly consulted over Shell and its partner’s planned exploration drive off the Wild Coast. Along with four other supermajors, Shell’s multi-million dollar commitment to blasting the public with “green” marketing has been revealed by new Influence Map analysis to be totally at odds with both its business model and lobbying to expand fossil fuel production.

Grieg Aitken


CCS has a long history – of failure

Riddled with well-documented technical, financial, and under-performance issues, tacking carbon capture and storage technology on to new oil and gas projects is no solution for a climate-constrained world, writes Bruce Roberston in The Bulletin of the Atomic Scientists.

Texas oil and gas producers are still constantly leaking methane pollution

Despite its energy sector being one of the most significant global contributors to human-caused methane emissions, the state's lax regulation lets polluters get away with it and places corporate profits over the health and safety of Texans, writes former inspector for the Texas Commission on Environmental Quality Sheila Serna in the Texas Observer.
How Europe’s towns and cities can lead the way on ending gas dependency

Sustainable, citizen-driven energy schemes are increasingly delivering for communities, but continue to be hampered by a lack of funding and data as well as the long shadow of fossil fuel interests, write Lavinia Steinfort and Andrew Cumbers in Social Europe.
Oil and gas sanctions leakage is propping up Russia

Backdoors are being opened to allow primarily imports of Russian oil, but also gas, to get through to “friendly” countries, writes Ben Aris in Business New Europe.


South African court blocks Shell exploration project in win for fishing communities and environmentalists

In an important precedent for other such cases, and following the filing of two lawsuits by several South African groups, the High Court in Makhanda ruled on September 1 that Shell’s exploration right to conduct seismic surveys for oil and gas off the country’s east coast was granted unlawfully by South Africa’s Department of Mineral Resources and Energy. Shell and its partner Impact Africa were lining up to explore in an area along the Wild Coast, so called because of its rugged terrain and home to Indigenous tribes as well as marine and land-based wildlife, including endangered and threatened species. The litigants’ claims of a flawed consultation process were proven, with Judge Selby Mfanelo Mbenenge finding that the companies had failed to engage in a “genuine, bona fide substantive two-way process” with Indigenous tribes. Shell and Impact Africa are expected to appeal the judgment. (Natural Justice press release, Inside Climate News) 

“Inferno Climatico” – Greenpeace targets major gas industry fair

In a series of peaceful actions that resulted in some intervention from the Italian police to remove activists, gas industry greenwashing was called out by Greenpeace Italy at this year’s showpiece Gastech conference in Milan. (Greenpeace Italia press release (Italian), Greenpeace Italia Twitter video)

Top News

U.S. agency quashes major LNG exporter’s pollution exemption bid: The U.S. Environmental Protection Agency (EPA) has denied a request from Cheniere Energy to allow the gas turbines operating at its Corpus Christi and Sabine Pass export terminals to be exempt from provisions under the newly reenacted National Emission Standards for Hazardous Air Pollutants. The EPA’s ruling has the potential to disrupt Cheniere’s LNG export flows to Europe and elsewhere and is a further indication that the federal agency is taking a more stringent approach under the Biden administration to pollution standards. Also this month, the EPA rejected a permit application for the proposed Bluewater Texas oil export terminal due to air pollution concerns. (Reuters, Caller Times)

New research shows extent of greenwashing at supermajors: Analysis from Influence Map has found a glaring disparity between the “green” public relations efforts of BP, Shell, Chevron, ExxonMobil, and TotalEnergies and the companies’ high carbon business models and lobbying activities. The think tank puts a conservative estimate of US$750 million on the five supermajors’ combined expenditures in 2021 on climate-related messaging, which was detected in 60% of the PR output analyzed. This contrasts with oil and gas expansion plans through to 2026 and capital expenditure budgets which, Influence Map forecasts, continue to have only a marginal share (12% collectively) intended for “low carbon” activities in 2022. (InfluenceMap)

EU gas storage progress vulnerable unless consumption is reduced: Despite the substantial progress made by EU member states towards meeting emergency targets for filling gas storage ahead of the winter heating season, a variety of analysts have warned that these efforts will be insufficient unless they are matched by ambitious efforts to reduce gas use. The warnings have come into sharper focus following Gazprom’s announcement of the indefinite closure of its Nord Stream 1 pipeline on September 2. Modeling by ICIS points to the need for EU countries to cut their gas consumption to 15% below the five-year average every month this winter. Otherwise, insists the data intelligence firm, Europe’s gas storage will be empty by March, even in a scenario where some Russian gas keeps flowing all winter and the weather is not unusually cold. (Reuters, The Guardian)

New UK prime minister warned off gas on day one: Following her installation as prime minister, former Shell economist Liz Truss immediately claimed that Britain can “ride out the storm” of the energy crisis. All eyes are on how she will attempt to tackle the nation’s escalating energy bill crisis and on her widely trailed intention to open up the North Sea to more drilling and lift a ban on fracking. Truss has insisted until very recently that fracking would only happen in areas where there was local consent. In an unprecedented appeal to an incoming prime minister, the heads of two influential independent advisory bodies jointly wrote to Truss warning that increasing UK gas production would not bring down energy prices, while policies to reduce demand would. Climate “dinosaur” Jacob Rees-Mogg has become the senior minister responsible for business, energy, and industrial strategy, one of several appointments to the new Truss Cabinet who are viewed as strongly anti-green. (The Guardian, DeSmog, Reuters) 

Netherlands increased imports of Russian LNG in first half of the year: Data released by the Dutch national statistical office, Statistics Netherlands (CBS), show that nationwide gas usage dropped by a quarter in the first half of 2022 compared to the same time period in 2021, though imports of LNG, including from Russia, jumped sharply. The 57% import rise was largely derived from U.S. and Russian suppliers, with the latter recording a 35% increase. In April, the Dutch government announced its intention to completely end all imports of Russian gas, oil, and coal by the end of this year. (CBS, NL Times)

“More low-carbon energy would have helped ease the crisis – and a faster transition from fossil fuels towards clean energy represents the best way out of it,”

said Fatih Birol, executive director of the International Energy Agency. 


Argentina: State oil company YPF and Malaysia’s Petronas have signed a deal to build a US$10 billion  LNG export terminal and accompanying pipeline to transport gas from the Vaca Muerte shale basin. 

Australia: Amid concerns about domestic gas shortages, Prime Minister Anthony Albanese has assured overseas trading partners that Australia will continue to be a reliable coal and gas supplier.

China: Shanghai has announced an 18-point policy package to support a development plan that will make it a major hydrogen hub. 

Croatia: An LNG Croatia official has said that the capacity of the floating LNG import terminal at Krk will be more than doubled by 2024-2025, ahead of the previously planned 2029 completion date. 

Europe: Data from Kpler show that LNG imports to the continent rose 60% year on year in the first six months of 2022, totalling 53 million tonnes.

France: In the latest round of diplomatic drum-beating over the MidCat gas pipeline, President Emmanuel Macron has weighed in, saying “there is no obvious requirement” for the French-Spanish interconnector to be resurrected.

Malaysia: Shell and Petronas have taken a final investment decision to develop the Rosmari-Marjoram gas fields that are situated 220 kilometers off the coast of Bintulu.

Mozambique: India’s Bharat PetroResources has suggested that construction work at the US$24 billion Mozambique LNG terminal could restart in the first half of 2023.

Norway: A new record annual volume of piped gas supplies to Europe is on course to be achieved by the end of the year, according to the head of pipeline system operator Gassco, making Norway Europe’s top supplier, ahead of Russia.

Russia: Norway’s Equinor has completed a full exit from its activities in Russia, while ExxonMobil and Total Energies have yet to fully divest.
Russia: Gazprom’s 1.5 million tonne per annum Portovaya LNG export terminal has started producing LNG at two production lines and is set to supply Russia's Kaliningrad region. 

Vietnam: Construction work has begun on an industrial park in the southern province of Binh Thuan that will host two 450MW gas-fired power plants and the US$1.4 billion Son My LNG import terminal. 

U.S.: California legislators have passed a new law banning new oil and gas wells within one kilometer of residences, schools, and nursing homes.

Companies + Markets

Enel CEO – Europe’s dependence on gas is “foolish”: The head of Italian energy multinational Enel, Francesco Starace, has called out Europe’s gas dependence, telling CNBC in an interview, “I think we have finally understood how hooked we were on gas, how foolish this dependence is, and how we can fix this.” Last year, Enel, which operates the second biggest gas power fleet in Europe behind France’s Engie, committed to phase out fossil fuel power generation by 2040 without the use of carbon offsetting, but has so far declined to specify when its gas plants will close. At the same time the company has been the main beneficiary in the last three Italian auctions for capacity payments for existing gas plants, with the payments covering the period 2022-2024. (CNBC, Ember, ReCommon (Italian))

Uniper locks in LNG supply deal up to 2039: Germany’s biggest gas supplier, currently developing a new floating LNG terminal at Wilhelmshaven, has agreed to a long-term sale and purchase agreement with Australia’s Woodside Energy for the supply of one billion cubic meters of LNG starting in January 2023. The flexible contract between the companies could run to 2039, depending on a long-term capacity bookings decision from Uniper that is expected in early 2023. (Uniper press release, Reuters)

Major gas companies put on climate “watch list” by Australian pension fund: Following years of prompting by its fund holders, the health sector superannuation fund HESTA has applied some pressure to AGL, Santos, Origin, and Woodside Energy by requesting they demonstrate how their new or proposed fossil fuel projects fit within a 1.5°C emissions reduction scenario. The move is in keeping with HESTA’s policy of “active ownership” whereby it seeks to engage with and influence companies in which it holds stakes, rather than divesting in those whose business practices are jeopardizing the global climate. Separately, it emerged that Santos has withdrawn and is now looking to resubmit applications for federal approval of a pipeline linked to its Barossa gas field project. (The Sydney Morning Herald, The Guardian)

Investors warned over Japanese blue hydrogen and ammonia rush: Ahead of the issuance this month of a first “transition bond” valued at JPY10 billion (US$70 million) by Mitsubishi Heavy Industries (MHI), Australian group Market Forces has compiled an analysis warning potential investors of the net zero transition plans of MHI and other Japanese energy companies that are heavily reliant on developing emissions-intensive blue hydrogen and ammonia. MHI is expected to use part of the proceeds from its upcoming bond issue to develop blue hydrogen and CCS. Market Forces cites concerns expressed earlier this year by Institutional Shareholder Services, which advises pension funds and other investors, that blue hydrogen may be a white elephant technology with significant stranded asset risk. (Mitsubishi Heavy Industries press release, Market Forces)

EU designs on more Caspian gas far from assured: Following this summer’s deal between the EU and Azerbaijan to potentially double imports of Caspian gas to 20 billion cubic meters (bcm) by 2027, hardline ruler Ilham Aliyev is set on expanding the Trans Adriatic Pipeline “very soon.” However, doubts persist over how quickly additional Caspian fields could be tapped. Azerbaijan appears able to eke out the extra 10 bcm only after 2027, with much depending on increasingly lukewarm western investors and financiers. In addition, Turkey could stake its legal claim to the potential Azeri gas and thus thwart EU ambitions. (Euractiv, Business New Europe)

China’s gas boom is just getting started: Its top energy companies may currently be racking up hefty profits by diverting LNG to desperate buyers in Asia and Europe, but a gas boom out to 2040 still remains the prize for China, according to Huang Weihe, an influential energy figure. Huang recently outlined China’s embrace of gas as a transition fuel, with major expansions to onshore and offshore domestic production being viewed as integral to national gas mix planning. Pipeline and LNG imports will still have a major role to play. The gas pipeline network alone is planned to be developed from 120,000km today to between 170,000 and 200,000km by 2040, to allow for the transit of up to 3 bcm per day of gas. (Bloomberg, Upstream)

U.S. LNG capacity set to expand further: U.S. LNG exports averaged 11.1 billion cubic feet per day (Bcf/d) during the first half of 2022, according to the U.S. Energy Information Administration (EIA), and the country’s position as the global leader in LNG export capacity and exports was further cemented by Venture Global’s Calcasieu Pass LNG terminal coming fully online in August. The EIA expects U.S. export capacity to further expand by a total of 5.7 Bcf/d by 2025, assuming completion dates at the under-construction Golden Pass, Plaquemines, and Corpus Christi Stage III projects are met on schedule. (U.S. EIA)

“This is really just targeting our industry for purposes of targeting our industry — as a way to try to further argue that oil and natural gas is a bad product,” 

said Lee Fuller of the Independent Petroleum Association of America, as the U.S. began the rollout, under the Inflation Reduction Act, of a US$1500 per tonne charge on some oil and gas companies that emit methane from wells, pipelines, LNG terminals, and other facilities.


The carbon capture crux: Lessons learned, Institute for Energy Economics and Financial Analysis, September 1, 2022. (PDF. Press release here

This 79-page report, featuring case studies on 13 large-scale CCS projects in the gas, industrial, and power sectors, documents how carbon dioxide capture is not a solution for countries’ net zero emission plans, with failed or underperforming projects (ten) significantly outnumbering the successful ones (three).

Global Gas Infrastructure Tracker – LNG Terminals Update, Global Energy Monitor, September 2022. 

This new update compiles downloadable data (up to the end of July) and summary tables on over 1,000 LNG terminal projects around the world.

Heating homes with gas is expensive, heating with hydrogen could cost double, Global Witness, September 6, 2022. 

This briefing, based on scenario analysis from the energy market consultancy Element Energy, warns that increasing gas industry pressure – with European Commission support – to burn hydrogen instead of gas to heat European homes and water could double consumer energy bills.