April 27, 2023
Issue 35  |  View Past Issues
Inside Gas
Published by Global Energy Monitor

Editor's Note

The U.S. government’s erratic approach to climate change and the oil and gas industry continues. Administration backing for the hugely controversial Mountain Valley Pipeline appears to have emerged as part of a Faustian, backroom deal. However, following three greenlights this month for new export terminals, a decision from the Department of Energy may lead to the axing of the proposed Lake Charles LNG project in Louisiana. Despite widespread calls for a clean energy reboot in the post-war reconstruction of Ukraine, the boss of the country’s state energy company is inviting Chevron, Exxon, and Halliburton in to get fracking as soon as possible. 

In Australia, the Australian Conservation Foundation will get its time in court to lay out the case against Woodside’s Scarborough gas field project in spite of the company’s attempt to muzzle the environmental organization. An intervention by Green Connection has helped to seriously derail major gas-to-power development plans in South Africa. The botched project preparation efforts of the Turkish company involved — Karpowership — have also played a role. The German government’s love affair with LNG goes on, though things are not going swimmingly for Chancellor Scholz and Vice Chancellor Habeck on the holiday island of Rügen.

Grieg Aitken


Is the World Bank really going green?

Its controversial president may be stepping down, but beneath the global public funder’s touting of its green credentials lies substantial support for fossil fuels through opaque types of financing, writes Heike Mainhardt in African Arguments.

LNG: A pricey distraction hampering a clean energy future for the Baltics

As the Baltic countries slashed gas demand by 37% last year, the Latvian government’s recent decision to shelve an economically nonviable import terminal should now spur on regional efforts to scale up energy efficiency measures and cheaper renewable energy, write Johanna Kuld, Liene Krauja, and Vera Kauppinen in Energy Monitor.

Why is the Biden administration backing the Mountain Valley Pipeline?

A letter to regulators from U.S. Energy Secretary Jennifer Granholm in support of the struggling US$6.6 billion gas pipeline shows the administration caving-in to Democratic Senator Joe Manchin, the longtime champion of the climate and health hazard project, writes Arianna Skibell in Politico.


Court tells Woodside: Scarborough case must proceed

The Federal Court of Australia has dismissed gas giant Woodside Energy’s attempt to throw out a legal case being brought by the Australian Conservation Foundation (ACF) aimed at stopping the massive Scarborough gas field project off Western Australia until its impact on the Great Barrier Reef is assessed. ACF’s General Counsel Adam Beeson welcomed the opportunity to present evidence in court, commenting, “No matter where Woodside’s gas is burned, it will contribute to the heating of the world’s atmosphere and oceans, bleaching coral reefs, including the Great Barrier Reef. ” The AUS$16 billion (US$10.5 billion) investment project off the Burrup Peninsula, also involving the expansion of the Pluto LNG export terminal, has attracted international condemnation and protests. (Australian Conservation Foundation, ABC)

Top News

Louisiana export terminal proposal put on death row by U.S. DOE: Following three contentious, pro-industry approvals already this month from the Biden administration for pre-final investment decision (FID) export terminals, the U.S. Department of Energy (DOE) has rejected the request of Lake Charles LNG for a second deadline extension to ship gas abroad. The promoters of the proposed US$11 billion terminal in southwest Louisiana wanted the deadline pushed back from 2025 to 2028. U.S. campaign groups believe that the decision likely spells the end for the pre-FID project as there is no way it can come online and start exporting by December 2025. In a separate policy statement, DOE announced changes to future extension requests from promoters. New applications for seven-year commencement extensions will no longer be considered unless companies prove they have started construction on an export facility or face extenuating circumstances. Roishetta Ozane, founder of The Vessel Project of Louisiana, said that the DOE policy move “is a step in the right direction towards environmental justice for all.” (Sierra Club, Reuters)

Ukraine looks to Chevron, Exxon, and Halliburton for fracking expertise: Oleksiy Chernyshov, the CEO of state energy company Naftogaz, has told the Financial Times that talks have been held with major U.S. fossil fuel players in recent months as “part of a strategic push to increase natural gas production that Ukrainian officials believe could help replace Russian supply to Europe in the years ahead,” the newspaper reports. While Ukraine’s offshore gas reserves in the Black Sea remain off limits until after the war, focus is being placed for now on the prospects for boosting onshore shale and unconventional production in western Ukraine. Negotiations with Chevron and Exxon are reportedly in their early stages, with Chernyshov commenting that the companies “can have a licence and produce by themselves, we welcome it.” The Naftogaz boss was more bullish about signing a contract with oilfield services group Halliburton that would help increase production to a target of 13.5 billion cubic meters (bcm) this year, an increase of roughly 1 bcm from 2022 levels, according to the FT. (Financial Times, Reuters)

Karpowership’s gas-to-electricity proposals floundering in South Africa: The fate of Turkish-owned Karpowership’s proposed floating gas power projects (combined capacity of 1220 megawatts) in the Eastern Cape is up in the air following a string of announcements that have derailed the company’s plans at three separate sites. Following a decision in March from the Department of Forestry, Fisheries and Environment (DFEE) to refuse environmental authorization for one powership application at the Ngqura port, Karpowership missed a deadline to appeal the decision by over a week. The DFEE is currently considering a justification from the company’s lawyers as to why the deadline wasn’t met. Karpowership’s environmental consultant advised in early March that the Richards Bay application had been withdrawn, though reportedly the DFEE views this application as closed. A further application for Saldanha Bay was suspended — pending an investigation — following a formal complaint from the Green Connection environmental group that alleges the submission of “misleading” environmental information by Karpowership’s environmental consultants to the DFEE. (Engineering News, Daily Maverick, Karpowership South Africa) 

Protests swell as German government looks to link Nord Stream pipes to island terminal plan: German Chancellor Olaf Scholz and Vice Chancellor Robert Habeck are backing a plan to link infrastructure from the now-defunct Nord Stream gas pipeline network to a proposed LNG facility on or near the island of Rügen, a renowned nature and tourism hotspot in the Baltic Sea. Major opposition to the project has been building on Rügen, and a recent trip to the island by Scholz and Habeck saw them welcomed by around 600 demonstrators. Amid ongoing uncertainty from the project promoters and proponents over the least bad site for the terminal – either five kilometers offshore or at the island’s Mukran ferry port – environmental organizations have launched legal actions against the plans, which they say trample over the German constitution. Meanwhile, it was revealed by German media that Berlin has purchased several thousand unused pipes from the Nord Stream 2 pipeline for the LNG terminal. (Bloomberg, Globe Echo, energate messenger, Inside Climate News) 
Enhanced coordination efforts sprout in Europe: A memorandum of understanding between the gas transmission system operators of Bulgaria, Romania, Hungary, and Slovakia was signed this week in Sofia with Azerbaijan’s state-owned SOCAR. The so-called Solidarity Ring initiative is intended to cement the supply of additional volumes of piped Azeri gas to southeast Europe and further afield. The EU’s new joint gas purchasing platform, known as AggregateEU, has also launched with approximately 80 mostly small- and medium-sized buyers and sellers reported to have signed up to the scheme. Developed as a means of reducing the record gas prices that afflicted the European economy and consumers last year following Russia’s invasion of Ukraine, the platform is expected to cover 13.5 bcm of the EU’s estimated 360 bcm annual gas consumption. (SeeNews, Financial Times)

Campaigners call on Scottish government to end Sturgeon-era “open door policy’’ for big polluters: Research conducted by Friends of the Earth Scotland has uncovered the “shocking” extent of oil and gas industry lobbying of the Scottish government under recently departed first minister Nicola Sturgeon. Scottish government ministers met with industry lobbyists more than 200 times — or nearly once a week — over the past four years. The environmental campaign group is calling on new First Minister of Scotland, Humza Yousaf, to end the government’s “open door policy” towards major fossil fuel firms. Meetings uncovered through scrutiny of the government’s lobbying register as well as ministerial diaries include: then Finance Secretary Kate Forbes meeting with oil and gas company Equinor during the COP26 climate conference in Glasgow; Energy Minister Paul Wheelhouse meeting with BP and Shell in consecutive years at an opera house in the Italian city of Florence, and; First Minister Nicola Sturgeon meeting with the president of PetroChina at her former official residence in Edinburgh. (The National, North Edinburgh News)

“This committee and their process is deceptive. It reeks of systemic racism when you lock out a community that you know will be affected and impacted,”

said local resident and activist Zulene Mayfield on being refused entry to a hearing of the Philadelphia LNG Task Force, which is studying the feasibility of developing an LNG export terminal next to a densely populated area in Chester, Pennsylvania, a city of roughly 32,000 people that is predominantly Black. 


China: PetroChina has chalked up its latest substantial LNG contract, signing a long-term sales and purchase agreement with Malaysia’s Petronas. 

India: Buyers including GAIL India and Petronet LNG submitted several tenders to buy LNG shipments for delivery from early May to June as an intense heatwave has pushed the nation’s power demand to record levels. 

Italy: FSRU operator OLT Offshore said that it expected to receive authorization “in the coming weeks” for a regasification capacity increase at its Toscana import terminal off the coast between Livorno and Pisa. The company said that all of the available 3.75 bcm per year capacity at the FSRU has been booked until 2027.

Mozambique: Instituto Nacional de Petroleo, the national oil and gas regulator, said that Eni is preparing to drill in the Angoche Basin what would be Mozambique’s first offshore exploration well in eight years.

Nigeria: The state energy firm Nigerian National Petroleum Corporation has been forced to increase spending on a US$2.5 billion section of the Trans Nigeria Gas Pipeline after expected project finance from Chinese lenders failed to materialize. 

Norway: The EU and Norway have signed a “Green Alliance” agreement to enhance cooperation on a range of energy issues. In the works since February 2022, with Oslo pushing to include oil and gas supplies beyond 2030 as part of the pact, the final text includes a focus on hydrogen and carbon capture and storage but not gas.
Republic of Congo: Italy’s Eni said it is aiming for first production this year at the floating Congo LNG  terminal that has been fast-tracked to supply European markets. The first plant will have a capacity of 0.6 million tonnes per year (mtpa), and a second ship is expected to come online in 2025 with 2.4 mtpa capacity.

UK: A ruling from the High Court of Justice in London has allowed a legal challenge from Greenpeace against the UK government’s North Sea oil and gas licensing round last year to proceed to a full hearing.

U.S.: Regulators in the state of Virginia have cautioned and fined Appalachian Power after they found its 456 megawatt Clinch River gas power plant had violated air pollution standards.

U.S.: The U.S. Federal Energy Regulatory Commission authorized Line 200 and Line 300 of LNG developer Tellurian’s US$1.4 billion Driftwood gas pipeline in Louisiana. 

Companies + Markets

Environmental and social costs behind Italy’s LNG drive exposed: A new report from the Rome-based NGO ReCommon details the highly ambitious and “risky” LNG expansion plans of Snam, a gas transportation and systems operator owned by the Italian state through the holding company CDP Reti. “Energy security for whom?” documents the company's aim, under its new strategic plan, of achieving 40% of total Italian gas consumption by 2026 via LNG imports sourced from fracked gas in the U.S. or from countries where conflicts and systematic human rights violations are rife, such as Egypt, Israel, Nigeria, and Qatar. The report further highlights the multi-million dollar support in the shape of loans and green bonds provided to Snam by Intesa Sanpaolo. Italy’s largest commercial bank has also bankrolled the expansion of U.S. export terminals in the Gulf of Mexico to the tune of US$2.1 billion in the last six years. (ReCommon [Italian])  

France’s central bank to exclude oil and gas from investment portfolio: A recently announced move from the Banque de France (BdF) suggests that France’s central bank now deems the oil and gas sector to be too risky for its own portfolio. With a new pledge to align its non-monetary policy investment portfolio with a 1.5°C trajectory, the BdF has upped the ambition of its previous commitments to limit investments in the oil and gas sector by deciding to exclude any company working on new fossil fuel extraction projects by the end of 2024. The strengthening of BdF’s fossil fuel exclusion policy for its €22 billion (US$24 billion) investment and pension portfolio “is designed to build a credible commitment and show the way forward to other central banks,” said Alexandre Gautier, the central bank’s deputy secretary general for finance. (Banque de France, Green Central Banking) 

Chevron’s LNG and CCS experiment keeps on failing at Gorgon: Without accounting for the emissions accrued from shipping and burning its gas overseas, Chevron’s Gorgon LNG plant off the Pilbara coast was a bigger emitter than any coal mine or other single major industrial complex in Australia last year, according to federal government data. CO2 emissions at the project jumped by more than 50% last year, from 5.5 million tonnes to 8.3 million tonnes, as a record 16.7 million tonnes of LNG was shipped from Gorgon amid record high international gas prices. A Chevron Australia spokesperson acknowledged, however, that: “Reduced CO2 injection rates at the Gorgon CCS system also contributed to the overall increase in emissions.” This understatement obscures the company’s own data release showing that last year the world’s largest industrial CCS system captured a mere 1.6 million tonnes of CO2 in injection wells, down from 2.2 million tonnes in 2020–21 and 2.7 million tonnes in 2019–20. The project was originally approved on the condition that the company store roughly 4 million tonnes of CO2 a year that would have otherwise escaped from reservoirs during gas extraction. (The Guardian)

Gas on the clean energy menu for North Macedonian households: A scheme announced by the Government of North Macedonia to incentivize households to give up on coal, fuel oil, and wood for heating includes subsidies for consumers to switch to gas. Out of total state support worth €1.3 million (US$1.4 million), €160,000 is to be allocated for the conversion of heating to gas. The largest chunk of the new funding — €487,000 — will go to the installation of solar panels. The Ministry of Economy claimed that the uptake of gas for heating will reduce costs for households as well as particulate matter and CO2 emissions. (Balkan Green Energy News)

Investor coalition overseeing €60 trillion in assets publishes “demanding” framework for assessing oil and gas transition plans: The Institutional Investors Group on Climate Change, a European-based coalition of over 400 asset owners and managers, wants its Net Zero Standard for Oil & Gas to inform investors’ engagement and escalation strategies that are aimed at aligning upstream, midstream, and integrated oil and gas firms with a 1.5°C climate scenario. The new standard includes an indicator list and scoring framework to rate the net-zero alignment of individual firms. These will be used to run public assessments of oil and gas companies later this year. “This is intentionally a demanding yet practical Standard that ensures investors will have the transparency they need to differentiate between companies that are genuinely transitioning and those that are not,” said Adam Matthews, Chief Responsible Investment Officer for the Church of England Pensions Board. “It levels the disclosure landscape.” (Institutional Investors Group on Climate Change)

Spain’s Enagas going after southern Europe expansion: As it posted a net profit of €54.6 million (US$60 million) for the first quarter of 2023, Spanish gas grid operator Enagas also disclosed this week that it had concluded the US$95 million sale of its stake in the Morelos Gas Pipeline infrastructure company based in Mexico. The move is part of the company’s repositioning of assets that sees it focusing on expansion plans in southern Europe in order to cash in on the continent’s so-called energy security drive. In February, Enagas acquired a 130-kilometer gas pipeline in Spain from operator Reganosa, increased its stake in the Trans Adriatic Pipeline to 20%, and is in the process of commissioning the mothballed El Musel regasification terminal in Gijon, which is scheduled to come online in July. (Upstream [paywall])

Europe’s regas capacity versus utilization conundrum: New analysis from European power and gas market consultancy Timera Energy into Europe’s rapid, crisis-driven LNG infrastructure build out outlines the potential effect on utilization levels across the continent’s import terminals if planned boosts to regasification capacity materialize in the next five years. Timera, which provides consulting services to energy producers, utilities, and investment funds, lays out a single chart scenario where hugely accelerated import capacity growth out to 2027 — being driven by Germany’s frantic terminal planning  — significantly dampens regas utilization from the 80%+ levels that were triggered by Europe’s pivot last year from Russian gas to LNG imports. The consultancy’s modeling shows regas utilization falling to the 60-70% range by 2024 and hovering around this level until the end of the decade. Timera’s outlook is based on the assumption that “global LNG supply growth in the second half of this decade sees increased flows to Europe.” (Timera Energy)


Expansion of the Southern Gas Corridor pipelines and future supplies to Europe, The Oxford Institute for Energy Studies, April 2023. (Pdf)

This 29-page paper examines the production, technical, financial (US$7 billion costs), and market challenges confronting the planned export of an additional 10 bcm per year of gas from Azerbaijan to Europe starting in 2027. It concludes that, despite a great deal of uncertainty, a final investment decision for export expansion is possible if buyers sign binding commitments this year following auction commitments.

Who Profits From War: How Gas Corporations Capitalise on War in Ukraine, Greenpeace International, April 27, 2023. (Pdf, see also the press release) (The accompanying website provides maps, video testimonies, and infographics) 

This 108-page report provides a detailed overview of the disastrous consequences already under way, and being locked-in for the future, on both sides of the Atlantic as a result of both the rushed project planning and the major increase in U.S. LNG exports to Europe that have been aggressively pushed by the gas industry since Russia’s invasion of Ukraine.