Eurostat — European gas consumption and power generation significantly down again in 2023: Preliminary data from Eurostat, the EU’s statistical agency, show that gas consumption in 2023 across the bloc’s 27 member states fell to its lowest level since 1995, marking a 7.2% decline over the year. Five countries saw consumption rise, with the only large consumer among these — Poland — recording a 5.5% rise following an almost 18% slump in 2022. Across the board, gas-fired power generation dropped to a five-year low of 353 terawatt-hours, down by nearly 20% compared with 2022. Eurostat’s figures broadly line up with recently published data from Eurelectric. The European power sector association’s numbers for 2023 show higher — and rising — renewable energy output, combined with an increase in hydropower and nuclear power use, eroding gas use. The trend and future outlook suggest that gas-fired power output in the European region has peaked in volumetric terms although it retains a place in energy plans as a source to support the energy transition. In its most recent gas market report, the International Energy Agency (IEA) tipped European gas demand in 2024 to grow by 3% while remaining almost 20% below 2021 levels. The IEA also forecast global gas demand to grow by 2.5% this year, though cautioned about “the high level of uncertainty that clouds estimates for both LNG production and consumption levels” due to factors including “potential start-up delays at new liquefaction plants, a tense geopolitical context and worsening feedgas issues at certain legacy projects.” (Argus, Energy Intelligence, International Energy Agency [Pdf]) 

Consultation lacking on Italy’s Mattei Plan, top African Union official tells Melloni: The unveiling of Italy’s long-trailed Mattei Plan for Africa by Prime Minister Giorgia Melloni has led to more questions and concerns than answers, as well as a public rebuke by African Union Commission President Moussa Faki. “Madam Prime Minister,” Faki said in a speech during a summit in Rome, “on the Mattei Plan you propose we would have wished to be consulted.” Named after Enrico Mattei, the founder of Rome-based oil and gas firm Eni, the Italian government’s development project for Africa is aimed at driving economic growth to stem African immigration to Europe and has energy projects — and Eni — at its core. During a speech outlining the €5.5 billion (US$5.95 billion) plan, Melloni flagged three key pilot projects, including an Eni investment for biofuels production in Kenya, but remained quiet about African gas projects that many observers predict will ultimately follow. Power Shift Africa’s Fadhel Kaboub commented that the Mattei Plan risked being “nothing more than a blatant colonial project that must be rejected rather than celebrated by African leaders.” The day after the Italy–Africa summit, Environment Minister Gilberto Pichetto Fratin suggested to Italian media that private sector gas projects such as Eni’s Coral North LNG project in Mozambique could be integrated into the plan on energy security grounds. The US$7 billion export project has been proposed to start in 2027 and has yet to take a final investment decision. (Climate Home News, Agenzia ANZA, The New Arab, Power Shift Africa, European Council on Foreign Relations, Staffeta Quotidiana [paywall, Italian]) 

Questions over Papua LNG’s prospects as experienced energy minister steps down: The surprise resignation of Papua New Guinea’s petroleum and energy minister, Kerenga Kua, has fuelled speculation that the TotalEnergies-led Papua LNG export project could be further delayed. Citing concerns about the current government’s record and leadership, and after serving four years as minister, Kua’s resignation letter to Prime Minister James Marape also warned that political interference could threaten the progress of the US$13 billion project. Kua’s departure may trigger a vote of no confidence in the government in the coming weeks. The U.S. Export-Import Bank (Ex-Im) is coming under increasing pressure from local and international environmental groups to refuse financing for the project on biodiversity and climate grounds. While the project’s promoters have so far not announced any long-term purchase and sale agreements, Ex-Im is remaining tight-lipped about the timeline for a financial decision. (Upstream [paywall], PNG Facts, Superior Invest) 

Study finds that North Macedonia’s gasification plans are economically unfeasible: Despite millions in EU public money pledges for the North Macedonia–Greece gas interconnector, and potentially more financing to come from the European Bank for Reconstruction and Development (EBRD), end-user cost projections contained in a new study predict that if North Macedonia’s gasification plans are realized, then gas network tariffs could rise 100–300% higher than current rates, making household gas conversions economically unfeasible. In the twelve years up to 2022, a mere 503 customers have chosen to connect directly to the country’s slowly developing gas distribution, mainly because of the high costs involved. The REKK consultancy’s study also estimates that construction costs for the main gas pipeline and distribution network, which the 126-kilometer pipeline connection to Greece would be part of, have shot up by at least 35% over the government’s previous estimates to more than €1 billion (US$1.08 billion). With poor public consultation and information lacking on the feasibility of the pipeline or expected gas demand projections since the energy crisis — the most recent EBRD study was published in 2020 — REKK also assessed alternative options for using the gas network investment money. It found that under a scheme covering 90% of costs and leaving 10% to households, 49% of detached and semi-detached houses could be provided with 3 kilowatt solar photovoltaic installations, 40% with air-to-air heat-pumps or 15% could have their building insulated. (Ekosvest (Pdf), CEE Bankwatch Network, Bankwatch YouTube)

Construction halted at troubled Cyprus import terminal: The after effects of a hard-hitting report by the national audit office into the management and financing of an LNG facility at the port of Vasilikos continue to be felt and have led to a halt in the construction of the 2 million tons per year (mtpa) capacity import project. It has emerged that China Petroleum Pipeline (CPP), the lead construction contractor, filed an arbitration claim in a London court in October 2022 seeking up to €100 million (US$108 million) in increased project costs from the Cypriot state. CPP has also called a halt to the project’s construction in the last seven days. “I had concerns since day one. This was not a project of our choosing but one we inherited from previous governments,” commented Energy Minister George Papanastasiou, while seeking to play down the legal dispute and the construction stoppage. “We are paying for sins of the past.” (Cyprus Mail)

Question marks over safety regime as ruptures halt work on Woodside’s Scarborough pipeline: Software malfunctions are said to be behind two serious incidents in the last month that have led Woodside Energy to pause construction of a 430-kilometer offshore pipeline from the US$12 billion Scarborough gas field to the Pluto gas export plant in Western Australia. The Italian engineering firm Saipem has been carrying out the installation since mid-December using its Castorone pipelay vessel and the incidents have prompted union accusations that the companies are taking safety shortcuts. “Woodside must take a more hands-on approach with the Castorone and undertake a complete review of Saipem’s health and safety standards and culture,” said Brad Gandy, a spokesman for the Offshore Alliance union that represents offshore oil and gas workers. Australia’s offshore regulator is investigating both incidents, the latest one of which left a large hole in the pipeline and required an evacuation of workers. According to Woodside, no injuries to personnel were sustained, but construction work has been halted for at least four weeks to fix the hole. Earlier this month, the company reported that the Scarborough project was 55% complete and on track to start exporting gas in 2026. (WAtoday, Argus, WAtoday)
 

Algeria: With a 26% rise in export volumes in 2023, Algeria has replaced Nigeria as Africa’s top LNG exporter. State-owned Sonatrach has also signed a ten-year deal, involving the supply of 3 mtpa of LNG from 2029, with the Isle of Grain import facility in the UK.  

Australia: First gas at the controversial Barossa offshore field could be up to six months delayed in the second half of 2025, according to latest estimates from Santos, and will require an additional US$200–300 million in project costs. 

Denmark: The TotalEnergies-operated Tyra field, Denmark’s largest gas field, is due to restart production in March 2024 following renovation work ongoing since September 2019. 

Germany: Securing Energy for Europe, formerly known as Gazprom Germania, sees a future, post-2040 role as an LNG supplier to Asian markets, according to CEO Egbert Laege. 

Iran: The National Iranian Oil Company has laid out investment plans of more than US$70 billion in the coming years to increase the country’s gas production capacity to 1.5 billion cubic meters per day.

Italy: The offshore, 2.8 mtpa capacity Toscana LNG import terminal, which began operating in 2014, is to be closed between April and October this year for “extraordinary” maintenance.   

Mozambique: India’s state-owned Bharat Petroleum Corporation (BPCL) expects that force majeure will be lifted on the Mozambique LNG project in July 2024, with the export facility then to become operational by 2028. This latest speculation came as BPCL announced it had contracted 1 million tons of LNG from the stalled 13 mtpa project.  

Netherlands: The greenlighting of French company ENGIE’s new 500 megawatt (MW) gas plant by Nijmegen’s city council is expected to draw increasing activist mobilization.

UK: The North Sea Transition Authority has awarded 24 exploration licenses to 17 companies, including Shell, Equinor, BP, and TotalEnergies, in its latest lease sale for North Sea oil and gas exploration acreage.

U.S.: The state of Louisiana is suing to obtain communications between U.S. Environmental Protection Agency officials, environmental justice groups, and journalists related to the permitting of petrochemical plants in the state’s notorious “Cancer Alley.”

U.S.: Newly released data from the Bureau of Land Management show that President Joe Biden has approved nearly 50% more oil and gas drilling permits for wells on public lands than the Trump administration did in its first three years. 

U.S.: The Republican Party is looking to bring a vote later this month in the House of Representatives aimed at overturning the government’s temporary freeze on LNG export approvals.  

U.S.: The Department of Energy has released watered-down energy efficiency standards, for implementation in 2028, that will prohibit 3% of the gas stoves in the U.S. market and likely reduce CO2 emissions by almost 4 million metric tons over 30 years, the equivalent of the annual emissions of 500,000 households. 

Vietnam: Japan’s city gas supplier and LNG importer, Tokyo Gas, has formed a joint venture with two other firms to undertake an initial feasibility study for a 1,500 MW LNG-to-power plant, estimated to cost US$2 billion, in the northern province of Thai Binh.

Delays expected on construction of Power of Siberia 2 pipeline: Wrangling over contract pricing by Beijing and Moscow is slowing down development of Gazprom’s Power of Siberia 2 (PS-2) pipeline, with a hoped-for construction start in 2024 for the 3,5500-kilometer project now very much in doubt. While both governments continue to say nothing substantive about the ongoing negotiations, Wei Xiong, a senior analyst with Rystad Energy in Beijing, told the Financial Times that local industry in China was still banking on PS-2 beginning operations in 2030 to meet rising Chinese demand. Substantially lower prices for piped gas compared to LNG imports continues to be uppermost in the thinking of Chinese industrial buyers. Aside from these complications, the Kremlin is remaining bullish about its diversification drive away from European markets and towards Central Asian states. New supply agreements between Gazprom and Kazakhstan and Uzbekistan are said to be in the offing. Gazprom said that it has also increased deliveries to Hungary in January. Separately, Russia’s largest crude oil producer, state-controlled Rosneft, announced that it increased gas production to a record-high of 106 bcm in 2023, a 42.5% increase on its 2022 output. (Financial Times [paywall], Upstream, Reuters)

U.S. investor sparks hopes of new Asian import projects: Atlantic Gulf & Pacific Company (AG&P) LNG is hoping that a US$300 investment from a U.S. firm can kickstart the sanctioning and construction of six LNG import facilities across South and Southeast Asia in the next one to two years. Nebula, which describes itself as “a fully-integrated investment, development, and asset management company dedicated to revolutionizing the energy landscape,” has acquired an 80% stake in AG&P LNG, which currently owns and operates the Philippines LNG import terminal in Batangas Bay that came online in 2023. The slate of six new projects is reported to involve a combined capacity of 25 million tonnes per year. The Philippines, Vietnam, Indonesia, and India were cited as likely project locations, though details provided so far only identify the Karaikal terminal on India’s southeast coast where AG&P LNG’s construction work has been disrupted since February 2020. (Reuters, Nebula Energy) 

Traders, majors, and banks looking to cash in on Europe’s burgeoning biogas market: Despite the EU’s recent ditching of a biomethane production target of 35 billion cubic meters (bcm) by 2030, the European Biogas Association is pinning its hopes on the doubling of current production to over 40 bcm by 2030. The establishment of a more mature market environment for the fuel is seen as key to this. Commodities traders including Gunvor Group are notably scaling up their biogas trading teams, while firms such as Goldman Sachs, BP, and Cargill are spending billions of euros on production facilities from Spain to Germany. Although concerns have been raised about the sustainability of the feedstock — energy crops, food, and animal waste — for high volumes of biogas, alongside widespread skepticism about the fuel’s very high price tag, biomethane production in Europe grew by almost 20% in 2022 to 21 bcm. Consumption is also rapidly rising in Denmark, where the share of biomethane in total gas demand rose to nearly 40% in 2023 from 3% in 2016. (Bloomberg)

India’s coal gasification ambitions get US$1 billion subsidy support: In support of a target to gasify 100 million tonnes of coal by 2030, the Modi government has approved US$1 billion in state subsidies for projects to convert coal and lignite into methane. Two coal gasification plants with projected start dates in 2028–29 have also been approved. State-owned Coal India is partnering separately on the two projects with gas distributor GAIL and Bharat Heavy Electricals. Coal gasification is part of the government’s drive to reduce reliance on expensive LNG imports by 10%, according to official statements, which is also seeing more focus being given to the development of biogas. The state of Uttar Pradesh has been earmarked to get 100 new compressed biogas (CBG) plants, part of a plan to install 750 CBG plants nationally by 2028–29. Mandatory blending of CBG in domestic gas and piped gas is to be rolled out, starting initially from this year with 1% voluntary blending for cars and households. India currently has 75 CBG plants in operation. (Argus, Argus)

Morocco’s biggest gas field set to be tapped as Energean eyes expansion: Energean is poised to receive Moroccan regulatory approval to take over the operating of Morocco’s biggest gas project, the offshore Anchois field. The London- and Israel-listed firm struck a deal in 2023 to acquire a major stake in the project from the original operator, London-listed Chariot Energy, and approval would allow for the start of drilling later this year. Anchois, which was discovered in 2009, has estimated reserves of 1 trillion cubic feet of gas. Energean has forecast higher production in 2024 off the back of a doubling of its profits to US$925 million in 2023. The company said that its operations in Israel continue to be unaffected by the ongoing conflict in the region and that expansion of its Karis field offshore Israel would start up shortly. Its production guidance for this year was nonetheless 10% less than some analysts had predicted. Sluggish gas demand in Israel is a factor, according to CEO Mathios Rigas, who said that the Israeli government is “holding back a bit on the phasing out of coal, which is understandable for security of supply.” (Upstream [paywall], Reuters) 

Total Turmoil: Unveiling South Korea’s Stake in Mozambique’s Climate and Humanitarian Crisis, Solutions for Our Climate, January 29, 2024. (Pdf)

This 24-page report describes and criticizes the role of a string of Korean companies and public finance institutions in two major LNG export projects reliant on extraction in the offshore Rovuma Basin. 

Q&A: What does Biden’s LNG ‘pause’ mean for global emissions? Carbon Brief, January 30, 2024.

This online briefing assesses the implications of the U.S. government’s “temporary pause” in approvals for new LNG export licenses to countries without free-trade agreements. 

Underground natural gas storage facility operations and well leakage events in the United States, U.S. Department of Energy, January 30, 2024. 

This online study by federal regulators uses government data to estimate that a significantly greater than expected number — 11,446 — of underground gas storage wells across the U.S. have a potential “single-point-of-failure design,” making them liable to major methane leaks.

The dawn of the clean hydrogen economy, Canary Media, February 1, 2024. 

This online, multi-article series examines a range of key issues that will determine whether global ambitions for a clean hydrogen economy succeed or fail.