Far-right election victory puts Italy on the path to major gas lock-in
Now that the Brothers of Italy party has won Sunday’s election, the gas industry is licking its lips at the prospect of even stronger governmental backing for new pipelines, LNG terminals, and offshore drilling, writes Stella Levantesi in DeSmog.
How the U.S. gas industry has overturned climate policy since day one of the war in Ukraine
A letter that landed in the White House on February 25, calling for “virtual transatlantic gas pipelines” to be flowing from the U.S. to Europe by winter 2022, has set the agenda for the U.S. gas industry’s onward march since, writes Oliver Milman in The Guardian.
Gas industry fingerprints visible in draft U.S. clean hydrogen strategy
A draft 121-page National Clean Hydrogen Strategy and Roadmap has emerged almost six months behind schedule from the U.S. Department of Energy, and will require revisions if its “strategic, high-impact uses of hydrogen” ambitions are to be properly clean, writes Leigh Collins in Recharge.
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Actions across Asia call out Japan’s false decarbonization solutions
Campaigners in Japan, Bangladesh, India, Indonesia and the Philippines have conducted coordinated actions to protest the Japanese government’s promotion across Asia of hydrogen, ammonia co-firing, and LNG as a means of mitigating greenhouse gas emissions. “The Japanese government is pushing Asian governments to expand gas, delaying the phase-out of fossil fuels in Asia,” said Hiroki Osada of Friends of the Earth Japan. “Japanese-funded gas projects, such as in the Philippines, have been destroying rich marine ecosystems, on which local fishing communities depend for their livelihoods.” (Friends of the Earth Japan)
Paris and New York increase climate litigation pressure on TotalEnergies
A coalition of fourteen local authorities and six NGOs that are suing TotalEnergies under French law for failing to adequately prevent climate change has been strengthened by participation from the cities of Paris and New York. Mayor of Paris Anne Hidalgo commented, “With this lawsuit, we want to force a major energy player to respect the Paris Agreement.” A trial is thought to be possible in March next year at the earliest. (Reuters)
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Manchin’s “dirty deal” down but not completely out in Washington D.C.: Lacking the necessary political support, and in the face of extensive opposition from communities and groups across the country, U.S. Democratic Senator Joe Manchin pulled his bill aimed at fast-tracking permitting for energy projects from a vital government funding package. Manchin’s so-called “dirty deal” would have been a major boon for the struggling Mountain Valley gas pipeline and a host of proposed LNG export projects involved in pending federal permitting processes. Oil Change International research calculates the total greenhouse gas emissions tally for the pipeline and ten U.S. LNG export terminals to be more than five times the potential emissions reductions resulting from the construction of 22 transmission line projects that the bill was also supposed to facilitate. Manchin has already signaled that he may try to attach his beleaguered bill to national defense legislation in December. (E&E News, The Crucial Years, Oil Change International, Senator Joe Manchin press release)
Landmark win for French campaigners as government restricts overseas oil and gas finance: Finance Minister Bruno Le Maire has announced an end to almost all of France’s government-backed financing for international fossil fuel projects, thus implementing a commitment made at last year’s UN Climate Conference. The legally binding policy pledge, which campaigners say must now spur on Germany, USA, Canada, Italy, and the Netherlands to publish their own updated overseas finance positions by the end of the year, contains exceptions that would permit French financing for gas-fired and oil-fired power plants only if they can be proven to benefit the energy mix of a country. The French state provided €9.3 billion (US$8.9 billion) in public finance for the oil and gas sector between 2009 and 2019. (Reuters, Friends of the Earth France/Oil Change International)
Fossil fuel financing in Africa outpacing renewable energy support by more than three to one: As the debate over Africa’s future energy pathway intensifies in the run-up to COP27 in Egypt, new research findings from the Climate Policy Initiative refute claims from the gas industry and some governments that Africa has been cut off from fossil fuel funding. Referencing the US$133 billion figure that the International Energy Agency estimates is needed annually in clean energy investment if Africa is to meet its energy and climate goals between 2026 and 2030, the U.S.-based nonprofit found that continent-wide annual investment in renewable energy stands at US$9.4 billion. By contrast, investment in fossil fuels has reached US$29.3 billion per year, with 90% of this financing derived from international sources. (Climate Policy Initiative)
UK’s new dash for gas makes no economic sense – study: By 2030 the UK could generate 99% of its electricity from clean domestic sources, even in adverse weather conditions, finds new modeling from the energy think tank Ember, which forecasts that this approach would see gas generation make up only 1% of total electricity output by 2030, thus avoiding £93 billion (US$99 billion) in gas costs in the same period. Despite pro-gas policy announcements from newly installed prime minister Liz Truss, the UK government has also announced that it will relax onshore wind planning rules that have been in place since 2015 in order to allow onshore wind power to be more easily deployed. According to Ember’s analysis, over the next four years, the UK has sufficient wind and solar capacity planned and under way to put it on track for a 2030 clean power target, if all these projects are approved and constructed. (Ember)
Priority treatment for oil and gas in Norway-EU “green” proposal: Environmental groups have strongly criticized a draft “green industry agreement” between Norway and the EU that contains provisions for enhanced co-operation on oil and gas flows to the European market as well as carbon capture and storage technology to increase oil production. Ahead of the planned signing of the agreement at the UN Climate Summit in Egypt, 28 Ukrainian, Norwegian, European, and international NGOs issued a joint statement warning against further subsidies and state support for hydrocarbons. “By endorsing further exploration, the EU is encouraging the lock-in of fossil fuels for decades to come – recklessly gambling against the targets of the Paris Agreement and its own climate targets,” noted the groups’ statement. (Norway Today, Razom We Stand)
Romania in a hurry to exploit large offshore and onshore fields: Energy minister Virgil Popescu believes that the ongoing emergency gas situation can provide the necessary momentum to overcome long delayed plans to develop the Neptun Deep (offshore) and Caragele (onshore) gas deposits. Taken together, it’s thought that both fields could cover Romania’s gas consumption for up to ten years. A final investment decision for Neptun Deep in the Black Sea is hoped for by the end of this year, while Popescu said that state-owned Romgaz will begin extracting gas from Caragele, located 100 kilometers from Bucharest, in 2024. (Business New Europe)
“Multiple crises have now demonstrated the risks associated with our dependence on oil and gas. Our direction of travel must continue to be away from oil and gas dependency, and it must accelerate,”
said the Beyond Oil and Gas Alliance, an international alliance of governments and stakeholders working together to facilitate the managed phase-out of oil and gas production, in a statement at the UN General Assembly meeting in New York.
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Afghanistan: The Taliban have signed a provisional trade deal with Russia that includes the supply of gas to the country.
Austria: Finance minister Magnus Brunner has said there are “no bans on thinking” as the potential for domestic gas fracking is to be studied.
Colombia: The tendering process for the delayed Pacific LNG import terminal has been reopened with bids to be lodged by March next year.
Estonia: Two months before the anticipated start-up of a new floating LNG import terminal in Estonia, the project developer has said that the LNG supply source is still unclear.
Germany: RWE has struck an agreement with the United Arab Emirates to receive a first delivery of 137,000 cubic meters of LNG by December at the under-construction floating LNG import terminal at Brunsbüttel, to be followed by several more shipments next year.
Mexico: President Andres Manuel Lopez Obrador has announced plans to develop a US$4-5 billion LNG export hub in the port of Coatzacoalcos to serve the European market.
Netherlands: The Dutch government is going ahead with another output cut at the massive Groningen gas field, down from 4.5 billion cubic meters (bcm) in 2021-22 to a maximum of 2.8 bcm in 2022-23.
Norway: Following explosions at the two Nord Stream gas pipelines under the Baltic Sea, the Norwegian government said it was raising the level of security readiness at all of its oil and gas installations including on its continental shelf.
Pakistan: The Iranian government is considering building the remainder of a partially completed 2,775 kilometer pipeline to supply Pakistan with gas.
Papua New Guinea: Prime Minister James Marape has offered Japanese companies preferential access to potential new gas fields and LNG as Japan seeks to reduce its reliance on Russian gas imports.
Philippines: Three government-approved LNG import terminal projects are expected to start operations in early 2023, according to a senior government official.
Poland: The new €1.6 billion (US$1.5 billion) Baltic Pipe will enter service on October 1 with initial capacity of 2-3 billion cubic meters per year (bcm/y), which will rise – ahead of schedule – to a full capacity of 10 bcm/y by the end of November.
UK: As the government in Westminster announced a lifting of the fracking ban in England despite substantial opposition, the devolved government in Edinburgh confirmed its moratorium on fracking in Scotland will remain in place.
Vanuatu: Nikenike Vurobaravu, president of the southwest Pacific Ocean nation, has urged other countries to join Vanuatu’s call for a fossil fuel non-proliferation treaty.
Zimbabwe: Australia’s Invictus Energy has started exploratory drilling for oil and gas in the northern Muzarabani-Mbire area.
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Supply contract terminations add to Tellurian’s troubles: Following the failure of a US$1 billion high-yield bond sale earlier this month, Driftwood LNG promoter Tellurian has also seen Shell and global energy trader Vitol terminate their purchase agreement contracts for a total of 6 million tonnes per annum (mtpa) of LNG from its proposed export terminal facility in Louisiana. One agreement, with the commodity trader Gunvor, remains active for 3 mtpa of LNG. As a result, the company’s outspoken co-founder Charif Souki has recognized the need for a rethink of the company’s business model and accepted that Driftwood will be further delayed. In his latest YouTube video, Souki urged investors to now consider Tellurian “a solid American production company with very real domestic prospects”, with the ability to sell LNG globally as a “Holy Grail”. (Reuters, GEM.wiki, Upstream)
Private finance warned off European LNG lock-in: A new report by the Paris-based think tank Reclaim Finance has warned that private finance involvement in the roster of recently proposed European LNG terminals would represent support for an unnecessary build-out of excess gas import capacity and shackle EU states to fossil fuel dependency for decades to come. In the last nine months, commercial banks and other private financiers appear to have steered clear of the new gas crisis projects. The projects that have made the most progress are heavily reliant on state handouts. However, Australian infrastructure investor Macquarie Capital has recently taken a minority stake in Deutsche Regas, which has begun construction of the Lubmin floating terminal in Germany. (Reclaim Finance, energate)
Texas taxpayers heavily subsidizing gas industry polluters: Eighteen polluting energy companies, including major U.S. gas players Cheniere Energy and Enbridge, have received almost US$2.5 billion in state and local tax breaks from authorities in the Coastal Bend region of Texas, according to a report from a team of economists commissioned by the Coastal Alliance to Protect our Environment. Cheniere, the owner and operator of the Corpus Christi LNG export terminal in the state, has been by far the biggest beneficiary, racking up over US$1.2 billion in giveaways. The report authors calculate that the 18 corporate polluters have received an average of US$953,294 in property tax abatements for each new job promised at their operations. (We Pay They Profit, Coastal Alliance to Protect our Environment press release)
QatarEnergy agrees major LNG and CCS deals: State-owned QatarEnergy has selected TotalEnergies as its first equity partner in Phase 2 of its enormous North Field LNG terminal, the world’s largest LNG project. The French major’s 9.375% stake in Phase 2 adds to its 6.25% stake in Phase 1 awarded earlier this year. QatarEnergy has also signed a memorandum of understanding with U.S. firm General Electric to join forces on developing a carbon capture roadmap for Qatar’s energy sector with the ultimate aim of capturing over 11 million tons per annum of CO2 by 2035. (Energy Intelligence, LNG Prime)
BloombergNEF forecasts winter survival for Europe without Russian supply: A radical turn to spot market buying of LNG, which will further increase competition with Asia for continued scarce supplies, is expected to see Europe through this year’s winter if Russian gas imports are completely halted by October 1. Bloomberg New Energy Finance analysis released this week forecasts a 40% spike in European LNG imports this winter compared to last year, but to do so, the continent’s buyers will need to purchase 90% more LNG on the spot market than they have secured under long-term contracts. The underlying problem, extremely tight global gas supply, is set to persist. The energy research company also noted production risks linked to the start-up of the Freeport LNG terminal in the U.S. and supply hurdles in Egypt and Nigeria. (Bloomberg)
Major asset manager becomes the thirteenth French investor to restrict oil and gas expansion: OFI AM has announced that it will no longer buy bonds from major hydrocarbon companies such as BP, Equinor, Shell, and Repsol. The company, France’s fifth largest asset manager, has also pledged to engage with all of its portfolio companies as part of efforts to stop the development of oil and gas supply projects. (Reclaim Finance, OFI AM policy [French])
Shell and Exxon launch US$2 billion sale of North Sea assets: The two majors are attempting to sell off a large slate of offshore natural gas assets in the southern UK and Dutch North Sea, according to industry sources. The sales are part of the companies’ efforts to dispose of aging oil and gas assets as they seek to cut costs and focus on newer, larger projects around the world. (Reuters)
“They are telling one story to investors and doing something else that gets results,”
said Dr. Sean Field, of the Centre for Energy Ethics at the University of St. Andrews in Scotland, on the news that private equity giant Carlyle Group failed to properly disclose the greenhouse gas emissions of a major oil and gas portfolio firm in which it invests.
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Winter is coming: Plastic has to go, Break Free From Plastic and the Center for International Environmental Law, September 23, 2022.
This 38-page report lays out policy recommendations for the EU to urgently reduce fossil fuel use for the plastics and petrochemicals sector, the largest industrial destination for oil, gas, and electricity in the EU, with nearly 40% of that energy going towards producing plastic packaging alone.
Europe’s Infrastructure and Supply Crisis, The Oxford Institute for Energy Studies, September 2022.
This 12-page paper looks ahead to 2023 and finds that winter 2023/24 may be “catastrophic” for the five EU countries – Germany, Czech Republic, Slovakia, Austria, and Hungary – most vulnerable to deep cuts in, or a complete loss of, Russian gas supply.
National policies to shield consumers from rising energy prices, Bruegel, September 21, 2022.
This online dataset provides rolling coverage of the measures introduced by European national governments since September 2021 to mitigate the effects of the energy price spike for consumers.
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