Australia’s first offshore drilling ban to be legislated in New South Wales: In response to widespread concerns from coastal communities, the government of New South Wales (NSW) has proposed new laws to ban all offshore gas and mineral extraction exploration in the southeastern Australian state. A bill being put forward by the Labor-run administration is expected to receive support from opposition parties. Passing of the new legislation will kill off one project in particular, Petroleum Exploration Permit 11, an exploration area 50 kilometers off the NSW coastline that has stoked controversy for a number of years. The NSW government said that the legislation will stop the most severe environmental impacts that can result from offshore exploration including oil spills and greenhouse gas emissions. (The Guardian)

To be discussed — new EU proposal for 90% net carbon emissions cut by 2040: The European Commission has announced its recommendation that the EU adopt a 2040 target of a 90% net cut of all greenhouse gas emissions (GHGs) compared to 1990 levels, a step up from the current target of a 55% reduction in emissions by 2030. The non-binding proposal from the EU’s executive body, which will still have to be negotiated and acted upon by a new Commission and European Parliament following elections in June, comes with a raft of “enabling policy conditions” and aims to achieve full decarbonization of the bloc’s energy sector shortly after 2040. Coal power would be fully phased out as part of an 80% reduction in the use of fossil fuels for energy from 2021 to 2040, with gas also to be almost entirely phased out as renewables and other zero- and low-carbon energy solutions take over. One of these, as laid out by the Commission in a new industrial carbon management strategy, is carbon capture. A previously proposed target of capturing 50 million tonnes of CO2 a year by 2030 has been significantly ramped up to 280 million tonnes by 2040. While the EU reduced its GHGs by 33% — compared to 1990 levels — in 2022, official data show it also emitted 3.6 billion tonnes of CO2 equivalent in 2022. The Institute for Energy Economics and Financial Analysis (IEEFA) warned that the big new emphasis on carbon capture is a bet on unproven technologies that could drive vast sums of public resources into inefficient projects. (European Commission, Euronews, Reuters, Carbon Brief, Politico, IEEFA)

India’s gas expansion strategy to cost US$67 billion by end of decade: Speaking at the India Energy Week conference in Goa, Prime Minister Narendra Modi outlined a US$67 billion investment plan for the next five to six years to boost the domestic gas sector. The spending plan backs up a previously announced target of increasing the share of gas in India’s energy mix from around 6.3% currently to 15% by 2030. Modi also noted that national primary energy demand will likely double by 2045 and be covered by a mix of fossil fuels, nuclear, growing renewable energy sources, and biofuels and hydrogen. The extension of a long-term LNG supply contract with QatarEnergy has also been signed and will see Petronet LNG receive 7.5 million tonnes per year (mtpa) out to 2048 under what are thought to be improved contractual terms for India’s biggest importer. As new long-term supply contracts continue to be sought by Indian buyers eager to avoid the volatility of the spot market, the CEO of the Dhamra import terminal, an Adani–TotalEnergies joint venture, said a potential doubling of its capacity was being assessed. Since coming online in May 2023, the east coast terminal has operated at a utilization rate of 55%, said Satinder Pal Singh. (The Times of India, LNG Prime, Reuters)

Agreement reached on Germany’s hydrogen-ready power plant fleet, many details still to be ironed out: After months of negotiations, Berlin has approved a plan to subsidize the construction of 10,000 megawatts (MW) of new hydrogen-ready gas-fired power plants. The scheme is part of efforts to supplement growing but intermittent renewable energy capacity in Germany’s grid, and converting the plants to run on 100% hydrogen is now to happen between 2035 and 2040, a change from the original plan to have the switch fully completed by 2035. Last minute differences of opinion between German ministers and the country’s utilities over how the state subsidies could be used held up the announcement. While the Ministry for Economic Affairs and Climate Action has not disclosed a specific budget amount, it is widely believed that €16 billion (US$17 billion) in public money will be deployed over 20 years to cover both start-up — or capital expenditure — funding and operating subsidies for hydrogen-capable plants. The environmental and consumer group Deutsche Umwelthilfe warned that the power plant strategy was still subject to EU state aid approval and that the lack of clarity over the financing and the tendering for new plants could result in gas plants that are not ultimately converted to hydrogen. That risk may have subsided as the new plan has been slimmed down from the initial ministerial proposal to tender for 23,800 MW of gas-fired plants, of which 15,000 MW were to be hydrogen-ready by 2035. (Hydrogen Insight, Reuters, Reuters)

Sweden closes Nord Stream investigation with no concrete conclusions, German and Danish probes continue: Sweden’s Public Prosecutor, Mats Ljungqvist, has closed his investigation into the sabotage of the Nord Stream pipelines in September 2022, stating that “Swedish jurisdiction does not apply.” In a press statement that references the ongoing German investigation, it is explained that the Swedish authorities “have a clear view of the incident and that nothing has emerged to indicate that Sweden or Swedish citizens were involved in the attack which took place in international waters.” Ljungqvist noted that Sweden had handed over material for use in the German investigation. A separate investigation is also ongoing in Denmark, where the police said an update is expected “within a short time.” Speculating on why the Swedish authorities did not provide a substantive public conclusion, Kenneth Øhlenschlæger Buhl of the Royal Danish Defense College said: “Sweden stands in a sensitive position as it wants to join NATO and may not want to rock the boat further.” (Swedish Prosecution Authority, Associated Press)

UK government knows how to pick North Sea oil and gas winners: Deltic Energy, whose largest shareholder is Lord Michael Spencer, was one of 17 companies to receive UK government approval at the end of last month to drill for fossil fuels in 24 new license areas across the North Sea. Lord Spencer, a billionaire and outspoken advocate for the oil and gas industry, also served as Conservative Party Treasurer between 2006 and 2010 and has donated £6 million (US$7.5 million) to the Conservatives either indirectly through his investment firm, according to UK Electoral Commission records, or under his own name. This includes donations of more than £100,000 to the Conservative Party and its election candidates since Rishi Sunak became prime minister in October 2022, according to findings uncovered by the website DeSmog. “Given the extraordinary correlation between donations to the Tories and valuable awards from the government,” commented Jolyon Maugham, executive director of the Good Law Project, “I wonder whether it would be more accurate to brand them as investments?” Following a separate freedom of information request to the government from DeSmog, it has emerged that the UK’s minister for energy security and net zero, Graham Stuart, sought guidance from BP in 2023 on how to try and win the argument that new North Sea drilling can ensure energy security and lower bills, while also asking Louise Kingham, a BP vice president, if the government had “the right incentives in place” to maximize North Sea oil and gas extraction. “Ideologically, you need to think where to do tax or incentives,” Kingham responded, according to heavily redacted documentation, “because you won’t get the investment.” (DeSmog, The Mirror, The Guardian)

The Gas Graph


Via Ember’s ‘European Electricity Review 2024,’ which also shows a record 19% drop in EU power sector emissions in 2023.

Australia: Oil and gas companies including Chevron, INPEX, Santos, and Woodside Energy were among the biggest donors to the Labor Party in the first full year of the Albanese government, according to the Australian Electoral Commission’s latest disclosure of political donations.   

Australia: Talks on a potential US$52 billion merger between Woodside Energy and Santos have been terminated. 

Germany: Leipzig-based utility VNG received Germany’s first piped gas from Algeria’s Sonatrach in January.

Iran: Seven newly inaugurated oil and gas pipeline and production projects are expected to bring in annual revenues of US$6 billion, according to the National Iranian Oil Company.  

Montenegro: Local politicians are expressing opposition to government plans for a 0.4 mtpa LNG import terminal in the port of Bar. 

Mozambique: ExxonMobil has announced that it is searching for a contractor to build a 2,500-bed workers’ camp for the long-delayed onshore Rovuma LNG project in Cabo Delgado province. 

Nigeria: Shell has taken a final investment decision to build a gas supply facility to feed a US$2.5 billion fertilizer plant owned by Aliko Dangote, Africa’s richest individual. 

Pakistan: Under pressure from the Iranian government and potentially facing a US$18 billion compensation claim for failing to complete its section of the massive, 2,775-kilometer pipeline straddling the two countries, the Pakistani authorities are scrambling to build a separate 81-kilometer gas pipeline connected to the border with Iran. 

Russia: Gas producer Novatek is setting up an office in Beijing, say multiple unnamed sources, in a bid to market gas to Chinese customers from the sanctions-hit Arctic LNG 2 project. 

UK: Following the Isle of Grain import facility’s recent ten-year supply deal with Algeria’s Sonatrach, the controversial U.S. LNG producer Venture Global has secured 3 mtpa storage and regasification capacity at the terminal in Kent for 16 years from 2029. 

U.S.: Six earthquakes in January and a latest 5.1 magnitude earthquake have compelled the state of Oklahoma to indefinitely shut down nine oil and gas wastewater wells at fracking sites that are thought to be linked to the seismic activity.  

Community complaint forces JBIC to open first LNG investigation after decades of support: Japan Bank for International Cooperation (JBIC) has announced a plan to formally team up with one of America’s top LNG players, Sempra Infrastructure, in efforts likely to involve export terminal expansion as well as carbon capture and storage and synthetic methane production near Sempra’s Cameron large-scale facility in Louisiana. A longtime, major financial backer of LNG projects in the U.S. and elsewhere around the world, Japan’s export credit agency is also having to respond to a complaint lodged with it in December 2023 concerning its involvement in Atlantic Gulf & Pacific Company’s Philippines LNG import terminal in Batangas that began operations last April. For the first time on an LNG-related investment, JBIC’s Examiner for Environmental Guidelines is opening an investigation following allegations by local fisherfolk, community members, and concerned groups that the bank failed to act in accordance with its investment guidelines over alleged environmental malpractice that took place during the 5 mpta terminal’s construction. JBIC has a US$100 million stake alongside Osaka Gas in the project located in the Verde Island Passage (VIP), a renowned biodiversity hotspot. “This is a first step for JBIC,” said Fr. Edwin Gariguez of advocacy group Protect VIP, “to finally hold itself accountable for its contribution to the proliferation of dirty gas energy in our Amazon of the oceans, in helping threaten the livelihood and overall well-being of communities, and in supporting a project that violated national laws.” (JBIC, Journal Online, GEM.wiki)

Europe’s third biggest pension fund drops 310 oil and gas companies over transition failures: Dutch pension fund PFZW has sold €2.8 billion (US$3 billion) in investments from a wide array of oil and gas sector companies, including BP, Shell, and TotalEnergies, over concerns that the companies had failed to come up with “convincing,” Paris climate agreement-compliant transition plans after two years of active engagement. PFZW, which manages assets valued at €238 billion and is ranked in the world’s top ten biggest pension funds, said it will continue to invest in a mere seven companies in the sector, including Austria’s OMV.  While the transition strategies of the retained companies were described as “compelling,” Joanne Kellermann, PFZW’s chairperson, said: “The intensive shareholder dialogue over the past two years with the oil and gas sector on climate has made it clear to us that most fossil fuel companies are not prepared to adapt their business models.” (Reuters, Financial Times [paywall])  

Top Chinese gas industry officials suspected of corruption: Qi Meisheng, the chairman of state-controlled China National Offshore Oil Corporation (CNOOC) Gas and Power Group, has been arrested, unnamed sources suggest, as part of an investigation into alleged corruption that is also said to be targeting other senior officials at CNOOC, China’s largest LNG importer. Details about the allegations are sparse, but the crackdown by the country’s anti-corruption watchdogs comes amidst a growing number of scandals and pledges by the authorities to weed out corporate malfeasance across the finance, energy, tobacco, and pharmaceutical sectors, as well as in state-owned enterprises. The government has also said that, in a case reported to be linked to Qi’s, Wang Yilin, the former chairman of state-controlled China National Petroleum Corporation, is under investigation for “serious violations of discipline and law.” Wang served as chairman of CNOOC between 2011 and 2015. (Energy Intelligence)

YPF targets increased drilling at Vaca Muerta: YPF, Argentina’s state-owned oil and gas company, reckons it can quadruple its market value over the next four years via a production drive at Vaca Muerta, the world’s second largest shale gas play. Vaca Muerta, which also contains the world’s fourth largest shale oil reserves, saw record oil production volumes in 2023. An unnamed YPF source suggested that this could be a catalyst for increased gas production that would also hold out the prospect of achieving the long-held objective of reducing reliance on expensive gas imports and potentially lead to Argentina becoming a gas exporter. Boosting Vaca Muerta production would also allow for divestment of the company’s conventional oil and gas assets. A privatization plan for YPF under a radical market reform legislative package tabled recently by new president Javier Milei has been shelved due to its non-feasibility. (OilPrice.com)

TotalEnergies’ boss bullish on Mozambique LNG restart: In spite of documented evidence of an uptick in activity from Islamic State insurgents in the last couple of months, TotalEnergies CEO Patrick Pouyanné has said the company is hopeful of a construction restart for the Mozambique LNG export terminal by the middle of 2024, more than three years on from the declaration of force majeure at the US$20 billion project. Though cautious in his comments, Pouyanné said during a presentation of Total’s 2023 results that the company was “remobilizing the contractors” and “reactivating” with a wide range of global project financiers that previously committed to the now troubled project in 2020. A new report from Columbia University, commissioned by Friends of the Earth Mozambique and other groups, has provided further evidence about how LNG project contracts are exposing the Mozambique state — under the Investor-State Dispute Settlement legal mechanism — to multi-billion dollar claims from the likes of Total. (LNG Prime, Friends of the Earth [Pdf])

Fossilized Finances: State and Federal Oil and Gas Subsidies in The Permian Basin, Natural Resources Defense Council and Earth Track, January 24, 2024. [Pdf]

This 18-page report provides a qualitative inventory of the U.S. federal and state subsidies that currently support oil and gas production in the Permian Basin, where extraction is projected to almost double by 2030 fuelled by subsidies of more than US$6 billion paid by Texas taxpayers alone.  

Delivering Equitable And Meaningful Community Benefits Via Clean Hydrogen Hubs, RMI, January 28, 2024.

This online report provides case studies, best practices, and tools on stakeholder engagement related to the recently announced US$7 billion federal program for seven U.S. hydrogen hubs.   

Gwede Mantashe’s quiet race to build a gas-fired rival to Eskom, The Financial Mail, February 7, 2024.

This podcast discusses with amaBhungane investigative journalist Susan Comrie the South African government’s big push for gas to replace coal and some of the troubling investment deals that have recently emerged.