Revealed — how Germany ignored Brussels guidance on avoiding LNG terminal overcapacity: Reporting by the German outlet Table.media has revealed that last spring, following Russia’s invasion of Ukraine, the German government ignored warnings from EU experts about developing excessive new LNG import capacity and instead plowed on with development planning for more than ten floating and onshore terminals. Previously unpublished European Commission documents detail the option — then on the table — for Germany to enhance gas connections with Belgium and France in order to cover for looming supply cuts from Russia. Comments from Commission officials in May that it was “generally important to avoid over-capacities that could become 'stranded assets' in the future” and that only two new German LNG terminals were necessary were overlooked by Berlin, which rapidly moved to enact its LNG Acceleration Law later that month. Three new floating terminals are already operating in Germany, adding 20 billion cubic meters of import capacity. “After these revelations, there is finally a line to be drawn under the planning of over-capacities,” said Constantin Zerger of environment and consumer group Deutsche Umwelthilfe. “Before more and more terminals are hectically built, a resilient overall concept must be presented with a consideration of all options for action and the consequences for the climate.” (Table.media [German], EU Observer)

More than 500 super-emitting methane events from oil and gas operations in 2022 — IEA report: The International Energy Agency’s Global Methane Tracker 2023 estimates the gas industry emitted roughly 40 million tons of methane in 2022. The IEA equates these routine “non-emergency” releases of methane, including flaring, from global oil and gas companies with having the massive Nord Stream pipelines’ release (following October’s explosions) every day. “[M]ethane cuts are among the cheapest options to limit near-term global warming," the IEA’s executive director Fatih Birol said in a statement. “There is just no excuse.” (Reuters, Bloomberg)

World’s “greenest” LNG project nears FID as doubts over CCS claims stack up: With a final investment decision (FID) thought to be in the offing for NextDecade’s Rio Grande LNG export facility in Brownsville, Texas, increasing doubts are being raised over the company’s ability to capture — as it has claimed for two years that it intends to do — 90 percent of the emissions from its operations via carbon capture and sequestration (CCS). As of late January this year, according to Jennifer Richards, a staff attorney with non-profit group Texas RioGrande Legal Aid, NextDecade “haven’t selected an injection well, which, I think, calls into question the seriousness of the proposal.” Bank funders for the US$15.7 billion investment project would be likely to agree to finance if NextDecade seals a major LNG supply deal with France’s TotalEnergies potentially in the coming weeks. (Gas Outlook)

U.S. gas power capacity growth expected to be marginal this year, and overshadowed by surging renewables: Alongside projected steep rises this year in solar and battery storage capacity for the national electrical grid, the U.S. Energy Information Agency (EIA) is also forecasting a decline in new gas generation capacity coming online from 9600 megawatts (MW) in 2022 to 7500 MW this year. Significantly, EIA data is also predicting the closure of 6200 MW of gas generation capacity in 2023. The EIA’s forecasts are based on estimates provided by utilities and power plant owners as to how they see plants coming online or being retired for the year ahead. (Ars Technica)

U.S. backing as Greece’s grid operator announces expansion plans: National gas transmission system operator DESFA is consulting on a ten-year, €1.27 billion (US$1.34 billion) development plan with the aim of cementing Greece’s position as a gas hub for southeast and central Europe. Increasing exports to the region is one of the central planks of the plan, which comes with a 55% increase in budget. Speaking this week in Athens at the launch of the fourth U.S.-Greece Strategic Dialogue, US Secretary of State Antony J. Blinken said: “The United States welcomes the leadership role that Greece is playing, including through the newly constructed Interconnector Greece-Bulgaria, which is putting Bulgaria on a path to import nearly 100 per cent of its domestic gas needs through Azerbaijan and through the United States.” (CEENERGYNEWS, CEENERGYNEWS)

Another Louisiana export terminal seeks federal authorization: Adding to the 16 export terminals that have been approved or are under construction along the Gulf of Mexico coast, a new entrant is advancing. Gulfstream LNG Development has filed an application to the United States Department of Energy seeking authorization to export up to 4 million tonnes per annum (mtpa) of LNG. First production at the facility is anticipated in less than six years, said the company, which also claimed that the use of electrical liquefaction drives will make it “among the greenest and lowest carbon emitting LNG producing facilities in the US Gulf region as well as globally.” A group of Republican Senators, including Ted Cruz, have also introduced a bill to boost U.S. LNG exports and, it’s claimed, support energy jobs in Louisiana. According to the Sierra Club, the Natural Gas Export Expansion Act — if passed — “would strip away the federal government’s responsibility to consider how LNG exports negatively impact Americans by exacerbating climate change, raising domestic energy prices, and perpetuating environmental injustices. (Gulfstream LNG, Offshore Energy, Senator John Kennedy press release, Sierra Club press release)

Bulgaria: Dutch bank ING has agreed a €49 million (US$51.8 million) state-guaranteed loan with Bulgartransgaz for the construction of the Bulgaria-Serbia gas pipeline.

Bulgaria: U.S. financial institutions, the International Development Finance Corporation and Export-Import Bank, and the World Bank’s Multilateral Investment Guarantee Agency are interested in funding a doubling of the capacity of the country’s only underground storage facility in Chiren.

Croatia: The government has confirmed that a €100 million (US$105 million), 180-kilometer cross-border pipeline project will move forward to connect the national gas network with neighboring Bosnia and Herzegovina.

Czech Republic: Russian gas imports dropped to zero in January, according to a government minister. Prior to the war in Ukraine, the country had imported up to 97% of its gas from Russia.

Cyprus: Construction on the delayed LNG import terminal at Vassiliko port is now planned to be completed by October 2023, with an additional €25 million (US$26.5 million) in project costs also announced following a new government agreement with the project’s Chinese construction consortium. 

Gabon: London-based oil and gas firm Perenco has taken FID on a liquefaction plant worth more than US$1 billion in the central African country.

Indonesia: Finance Minister Sri Mulyani Indrawati told the Munich Security Conference that countries in the Global South have the potential to move into renewables without the need for a transition fuel, but currently lack the capital required to do so.

Israel: Leviathan field partners NewMed Energy, Ratio, and Chevron have approved a budget of US$96.4 million to proceed with the project expansion, including the development of a floating 4.6 mtpa LNG terminal. 

Russia: Without putting forward specific timings or projects, Gazprom CEO Alexei Miller has said that the state-run company will soon start building large gas export pipelines to China, Central Asia, and possibly southern Asia.  

Spain: The currently idle El Musel LNG import terminal in Gijon is still missing approvals to finally begin operation after ten years in hibernation.

U.S.: The UK chemical manufacturer INEOS Energy is entering U.S. oil and gas production for the first time with the US$1.4 billion acquisition (expected to be completed in the second quarter) of a portion of Chesapeake Energy’s remaining oil and gas assets in the Eagle Ford shale.

Power outages set to worsen as Bangladesh and Pakistan’s gas and economic woes continue: If the regularly enforced power cuts in the second half of last year weren’t grim enough for the two South Asian countries, Reuters reports in an analysis article, there is a growing expectation that the economically damaging outages will get worse this year. Both countries are struggling with sharply weakened currencies, compounding the difficulties they’ve faced for the last nine months in securing high-price LNG imports on the spot market. US$20 per metric million British thermal unit (mmBtu) is viewed by the Bangladesh government as an acceptable spot price, and the state-owned Petrobangla has already this year struck a deal with TotalEnergies at US$19 per mmBtu. However, with a likely Chinese rebound in the coming months, Rystad Energy is forecasting average Asian spot prices for the year of US$32 per mmBtu. (Reuters)

EU slashed winter gas demand by almost one fifth — Eurostat: Data from the EU’s statistical agency show that, after being set a voluntary 15% gas demand reduction goal to help survive the heating season with much lower Russian gas imports, the bloc’s member states reduced their gas use by 19.3% between August last year and January compared with the five-year average for the same period. Demand rose only in Malta and Slovakia during the six month period. A combination of warmer than expected weather and sharp declines in industrial production due to high energy prices are thought to have been among the principal drivers. Russian piped gas imports fell from a historical average of around 50% to less than 10%. (Reuters, Bloomberg)

Export finance decline for oil and gas last year: TXF Intelligence’s survey of export finance volumes for 2022 has found that support from export credit agencies (ECAs) for oil and gas fell to US$10.5 billion from US$18 billion in 2021. The data intelligence firm noted, however, that US$14 billion of 2021’s ECA financing went to just two project deals in Russia, the Arctic LNG 2 terminal and the Amur gas chemical complex. Meanwhile, the IEA estimates that global subsidies for fossil fuel consumption more than doubled last year, surpassing US$1 trillion for the first time. Increased government action was required to lessen the impact of soaring energy prices; but, noted the IEA, the measures were not well-targeted and helped to artificially maintain the competitiveness of fossil fuels compared with low-emissions alternatives. (TXF News, IEA) 

More analyst skepticism about blue hydrogen prospects: New reports from the business intelligence firm IDTechEx are forecasting a global blue hydrogen market worth US$34 billion by 2033, almost four times less than an estimated valuation of US$120 billion for the green hydrogen sector by the same date. IDTechEx’s analysis expects the majority of blue hydrogen capacity installations to be based in Europe, “particularly from countries like the UK that want to decarbonise their large industrial clusters with blue hydrogen and CCUS,” but also sees blue H2 growth in North America, “mainly due to an increase in the pace of development in the US driven by the Inflation Reduction Act [IRA] and the development of many large-scale projects.” This latest fairly gloomy assessment follows an October report from the ratings agency Moody’s that viewed blue hydrogen projects as “long-term credit negative.” (Hydrogen Insight)

Europe’s largest utility takes Spanish government to court over windfall tax: Upset about the imposition of what it terms a “discriminatory” windfall tax, Spanish energy giant Iberdrola is preparing to launch a legal appeal against it at the country’s high court. The windfall tax in question, introduced by the Socialist-led government in Madrid in the wake of the energy crisis, is to be levied on companies that had revenues of more than €1 billion (US$1.06 billion) in 2019, including electricity utilities and oil and gas groups. Iberdrola, which has paid a €100 million windfall tax bill for 2023, posted a net profit of €4.34 billion in 2022 from revenues of €54 billion in 2022, up from €39 billion in 2021. A judgment from the court is not expected before next year. (The Financial Times, Reuters)

Record year for CCS project investments in 2022: Data from BloombergNEF showed U$6.4 billion in funding globally last year for carbon capture and storage projects, more than double the amount invested in 2021. U.S. projects lead the way with approximately US$2.8 billion invested, followed by Europe with just over US$2 billion in total investment. Australian and Malaysian CCS projects drove a jump to US$1.2 billion in overall Asia Pacific investments last year. The U.S. increase is thought to be a result of last year’s introduction of the IRA and its provisions for generous support to domestic CCS projects. (Upstream)

From emergency response to energy security in Europe: A way forward for 2023, E3G, February 16, 2023.

This 7-page briefing lays out how Europe, having weathered the crises brought on by gas market volatility and the war in Ukraine, can now pivot from an emergency response that has focused heavily on gas replacement to sustained energy security by embracing renewables and energy efficiency.

Private equity commits to LNG at the expense of long-term energy transition, Private Equity Stakeholder Project, February 21, 2023.

This second installment in a series investigating the role of private equity in the LNG industry outlines the proposed and announced US export terminal projects in which various private equity players are playing key investment roles.  

Liquefied Natural Cash: How Methane Exports Reverse Climate Progress, Harm Consumers and Endanger Communities, Friends of the Earth US, BailoutWatch and Public Citizen, February 22, 2023.

This 18-page report details how the gas industry is taking advantage of Russia’s invasion of Ukraine to make the world more dependent on methane. It estimates that the climate impact of the gas contracts signed in 2022 is equivalent to the yearly emissions of 94 coal plants.