August 19, 2022
Issue 9  |  View Past Issues
Inside Gas
Published by Global Energy Monitor

Editor's Note

The inevitable has happened in Bangladesh as sky high LNG prices persist. The government has just announced the cancellation of a 3.6 gigawatt gas-fired power plant and the LNG import terminal intended to feed it. These are unlikely to be the last project cancellations in Asia as campaign groups and researchers continue to make the case for cheaper renewables and gas market headwinds stiffen. More alarming scientific evidence about the severe public health risks attached to fracking has landed, as campaigners and politicians unite to put an end to the practice in Colombia.   

Although it continues to profit off the back of Russia’s invasion of Ukraine with a record high level of exports to Europe so far this year, increasing scrutiny is falling on top U.S. LNG exporter Cheniere Energy’s cavalier approach to climate change and pollution. New research shows that the gas industry’s methane leakage issue needs to be urgently addressed as ever improving detection technology reveals even greater dimensions to the problem. In Europe especially, the crisis-driven deal-making and speculation keeps on coming, alongside record high prices, which are set to increase the economic pain for millions of households shackled to gas this winter.  

Grieg Aitken


New U.S. climate legislation provides hope and fear

The passing of the Inflation Reduction Act into law by the U.S. Congress, containing more than $370 billion in climate, clean energy, and environmental justice investments, is a historic achievement, but fossil fuel infrastructure friendly provisions mean big battles ahead for frontline communities, writes Kate Aronoff in The New Republic.

Russia’s gas pivot to Asia will take time

Gazprom’s piped export volumes to China are on the rise, but with supplies to Europe now to be slashed, it may take until the 2030s before Russia can fully replace lost European sales in Asia, writes James Henderson in Business New Europe.

Five reasons to stop the EU’s plan for Ukraine hydrogen exports

The European Commission’s ramped up proposals for extracting hydrogen from Ukraine are exaggerated, would deny the country renewable energy resources vital for domestic decarbonisation, and should be scrapped, writes Simon Pirani in openDemocracy.

Industry plans for blue hydrogen are tanking on economic grounds

The production of hydrogen from methane, a long-held industry gameplan to keep the world hooked on gas, has become increasingly less viable as the new normal of hugely inflated gas prices takes hold, writes Justin Mikula in The Intercept.


Colombia green groups renew bid to ban fracking 

The Colombia Free from Fracking Alliance is confident that a fourth attempt to pass legislation that would prohibit the development of shale gas or coalbed methane will be successful under recently inaugurated President Gustavo Petro. More than 100 members of the country’s national congress have signed a bill that would cancel two proposed investigative pilot projects being promoted by state-owned oil company Ecopetrol and Exxon Mobil. A further bill put forward by the new government seeks to increase taxes for the fossil fuel sector while also removing subsidies for the sector. (Reuters)

Canadian coalition calls for rejection of LNG export terminal plans

Ahead of a visit to Canada this month by German Chancellor Olaf Scholz to discuss a potential LNG deal, more than a dozen Canadian environmental organizations have called on the federal government to reject new East Coast LNG export facilities due to climate-wrecking emissions and risks of stranded assets. The StopTheGas initiative has been launched as speculation mounts over efforts to resurrect stalled LNG projects such as the US$10 billion Goldboro LNG terminal in Nova Scotia, with campaigners stating that the Canadian government is using the war in Ukraine to “hoodwink” the public into believing that LNG projects are a necessary evil. (Canada’s National Observer, StopTheGas/StopponsLeGaz)

Top News

Major projects scrapped in Bangladesh over gas price concerns: Due to exceptionally high global LNG prices, the Bangladesh government has cancelled the proposed 3,600 megawatt (MW) Payra LNG power station as well as an accompanying import terminal. In development since 2017, the power plant was a joint venture between the Bangladesh Power Division and Germany’s Siemens. Bangladeshi civil society organizations, including the Centre for Policy Dialogue, the Bangladesh Working Group on External Debt, and Blue Planet Initiative, have been advocating against the government’s push in recent years for a slate of new gas power plants that would have to rely on LNG imports. With highly volatile LNG prices now expected to persist in the medium-term at least, the groups continue to advocate for renewable energy investments to be prioritized over gas. (Prothom Alo)

U.S. LNG giant’s greenwashing and polluting practices exposed: Cheniere Energy’s “carbon emissions tags”, a methane gas certification scheme that the company has been deploying since June this year to reassure customers about the level of dangerous emissions associated with its product, have been described by Oil Change International and Greenpeace USA as “putting lipstick on a pig”. A new report by the groups analyzing the methodology behind Cheniere’s scheme has found various evidence that the company is “woefully undercounting the leakage volumes” that it discloses to overseas buyers. A Reuters investigation has also uncovered evidence dating back to 2013 showing that the Texas-based company was able to ignore the concerns of U.S. regulators over using what were then thought to be excessively polluting gas-fired turbines at two of its now operating export terminals in Texas and Louisiana. (Oil Change International, Oil Change International, Reuters) 

African Union’s pro-gas proposal for COP 27 rejected: African climate diplomats have opted not to get behind a proposal, put forward in July by the African Union, for the continent’s delegations to the upcoming UN Climate Summit in Egypt to support new gas development. The diplomats, including representatives of the Egyptian presidency of COP 27, rejected the African Union’s embrace of all forms of energy, including gas. Sources suggested that a pro-gas position was too controversial and would distract from other key negotiating priorities at the meeting to be held in November. (Climate Home News) 

New bombshell study on fracking and leukemia risk for children: Yale University academics have published new research documenting how children living close to fracking sites in the U.S. state of Pennsylvania are two to three times more likely to be diagnosed with leukemia, with contamination of drinking water caused by the controversial oil and gas drilling technique suspected to be a prime cause. The study’s findings corroborate and add to a large body of evidence showing fracking’s health risks which, said senior study author Nicole Deziel, are now “a major public health concern”. (DeSmog)   

More MidCat 2.0 hype as France again says no: The latest push by the Spanish government to talk up the prospects of reviving a cross-border gas pipeline link to France, and then onwards to central Europe, has come not only with additional diplomatic support from Berlin but also with a highly ambitious 8-9 month timeline. According to energy minister Teresa Ribera, that is the approximate timing required to have the pipeline operating on the southern side of the border. In response, the French government has issued an “unequivocal” rejection of the proposal, Spanish media reports. A “detailed” statement from France’s Ministry of Energy Transition notes, “This project would take years to be operational and would not respond to the current crisis”, and “a faster solution” is to build LNG terminals in the maritime areas of countries such as Germany. (Reuters, Al Jazeera, Cadena SER)

Researchers detect a lot of industry’s methane on the water: A new remote sensing method that can detect methane over water, which was deployed by a team of researchers led by non-profit Carbon Mapper, has identified significantly higher methane loss rates from oil and gas platforms in the U.S. Gulf of Mexico than from typical onshore production. The researchers’ comparative findings were stark: a methane loss rate of 23-66% from shallow-water offshore Gulf of Mexico operations compared to 3.3-3.7% reported by other studies of operations in the Permian basin. (Carbon Mapper, Reuters)

The Gas Graph

In mid-August, European gas storage hit 75%. In mid-August 2021, storage was at 60.42%; in 2020, it was at 88.4%. At the same time, European gas prices have hit a new peak of over US$2,700 per 1,000 cubic meters. The cost for European countries hitting their gas storage target ahead of winter has been estimated at €50 billion (US$51 billion), ten times more than the historic average for filling storage tanks ahead of winter. (Via Business New Europe and Reuters)


Australia: New South Wales and Victoria, the country’s most populous states, are pressing producers to reserve gas for the domestic market. 

Australia: Senex Energy will invest more than A$1 billion (US$710 million) to expand its Atlas and Roma North gas projects in Queensland’s Surat Basin, with expansion work due to begin in the coming weeks. 

Bulgaria: Amid indications that the new caretaker government appears committed to undoing many of the steps taken by Sofia earlier this year to distance the country from Moscow, hundreds of protestors took to the streets of the capital in opposition to news that ministers are considering a new gas deal with Gazprom

Hungary: Gas deliveries from Russia have started to be ramped up following a July visit to Moscow by Hungary’s foreign minister.

Italy: The permitting for Snam’s newly purchased floating LNG regasification vessel, to be moored in the port of Piombino in Tuscany, will be fast tracked by the government. 

Moldova: Gas transport and distribution company Moldovagaz has said it will not be able to make the up-front payment for gas delivered by Gazprom in August by the end of this month.

Poland: Gaz-System has obtained the construction permit for the Kolnik-Gdańsk gas pipeline, one of the components of its proposed floating Baltic Sea Coast Terminal

Spain: Repsol has confirmed it is in talks with the Canadian government about developing the Saint John LNG import terminal to allow shipments to Europe.

Turkey: President Recep Tayyip Erdoğan personally oversaw the sending out of a drill ship on Turkey’s first eastern Mediterranean mission in two years, a move which could trigger a new cycle of tensions in the region.

UK: The government’s appointment of Jane Toogood as its “Hydrogen champion” has attracted criticism due to Toogood’s position as chief executive of multinational firm Johnson Matthey which markets technology that can produce blue hydrogen “from natural gas at scale”. 

UK: The first shipment of Australian LNG to Europe in at least six years is due to land in a UK port on August 22. 

U.S.: In a first-of-its-kind lawsuit in the U.S., groups are alleging that energy provider Washington Gas is “greenwashing methane gas in its materials”. 

U.S.: Emails obtained under the Freedom of Information Act show that a Virginia official lobbied in favor of a proposed TC Energy gas pipeline which the official’s agency is due to consider.

Companies + Markets

Novatek turning to Turkish company as Arctic LNG 2 challenges mount: Following the sanctions-related pullout of western engineering firms Baker Hughes, Saipem and Technip, Russian business newspaper Kommersant has reported that Novatek has very few options other than working with the Turkish firm Karpowership in order to have an energy source in place for the first 6.6 million tonnes per year (mtpa) liquefaction train due online next year at its Arctic LNG 2 terminal. The still-to-be-confirmed deal would involve the procurement of a 300-400 MW floating power plant from Karpowership. Other technical barriers owing to western sanctions are thought to be impeding the project’s realization on the intended schedule. (The Barents Observer, Natural Gas World)   

Namibian NGOs lose court case to halt onshore exploration: Canadian company Reconnaissance Africa, alongside local partner National Petroleum Corporation of Namibia, can continue its oil and gas exploration activities in the Kavango basin after a July 29 verdict by the country’s high court threw out a legal case brought against the company by local environmental organizations. The groups wanted the court to issue an interim interdict to stop the exploration activities, claiming that environmental requirements had not been met. (Newsbase, Energy Voice)

Germany signs deal with major gas firms amid street protests: Berlin has signed a memorandum of understanding with Uniper, RWE, and EnBW to ensure that two floating terminals expected online this winter at the ports of Wilhelmshaven and Brunsbuettel will be fully supplied with up to 12.5 billion cubic meters of LNG per year until March 2024. The deal was announced after a week of protests across Germany that saw thousands of people rejecting what they see as the government’s excessive policy turn towards fracked gas imports. Uniper also reported losses of €12.3 billion (US$12.4 billion) for the first half of this year, saying it had been pushed to the “brink of insolvency” by the huge drop in Russian gas deliveries. (Reuters, CBC, Financial Times)

International funders back midstream projects in Ghana: Banks, including Standard Bank, ABSA Bank, Société Générale, Mauritius Commercial Bank, and the Development Bank of Southern Africa, have agreed a US$425 million debt package which will enable Genser Energy Ghana to advance various new gas projects. Among these is a 100 km pipeline to Kumasi, Ghana’s second-largest city. (ESI Africa)

Iran to commission new pipeline, makes progress on delayed terminal: The 150 km Rasht-Chelavand gas pipeline is set to become operational, according to the National Iranian Gas Company, having been expedited last November after Iran signed a gas swap deal with Turkmenistan involving deliveries to Azerbaijan. Additionally, an LNG export project at Tombak Port on the Persian Gulf, which had seen no progress since 2008, has obtained a permit for 5 mtpa of liquefaction capacity. (Newsbase) 

Centrica, Delfin sign preliminary LNG supply deal: UK energy company Centrica has signed a non-binding deal to buy 1 mtpa for 15 years from Delfin LNG whose delayed LNG export plant off the coast of Louisiana is estimated to be operational in 2026. The value of the preliminary agreement has been disclosed at £7 billion (US$8.5 billion) and takes Delfin a step closer to a final investment decision for its US$7 billion project. (Reuters)

LNG export ambitions rising in Mexico: With seven proposed export terminal projects and one – the Energia Costa Azul (Phase 1) terminal – under construction, Mexico is positioning itself as a potential LNG export hub, despite the fact that it imports nearly all of the gas it uses domestically. Extensive cross-border pipeline capacity built up over the last ten years to import U.S. gas has gone largely unused due to aborted plans for over a dozen Mexican gas-fired power plants, and could instead supply U.S. shale gas to Pacific Coast terminals south of the border for onward export to Asian markets. (Bloomberg)

"Latest @CornwallInsight forecast shows UK energy bills reaching more than £4,400 next spring … More than 95% of the increase since Summer 2021 will be due to high wholesale gas prices … Green levies will fall from 5% today to around 2% of bills,"

tweeted Simon Evans of Carbon Brief. 


The Economic Case for LNG in Asia is Crumbling, Institute for Energy Economics and Financial Analysis, August 15, 2022. (PDF. Press release for the report is here.)

This 32-page report outlines how efforts to reduce LNG dependence are accelerating across Asian economies as sustained high prices over the past year have dented previous demand growth ambitions.

The Bottom Line: Why Canadian liquefied natural gas is not the answer for the European Union’s short-term energy needs, International Institute for Sustainable Development, August 16, 2022. (PDF)

This 12-page briefing finds that Canadian LNG infrastructure will optimistically take 3-5 years to come online, which is too late to address Europe’s current gas crisis needs, and attempts to develop these multi-billion dollar projects would be a poor economic decision for Canada.