Financing blow for Papua LNG: French bank Crédit Agricole has become the eighth bank to declare that it will not directly finance the proposed US$13 billion Papua LNG terminal being led by TotalEnergies in a consortium also featuring ​​ExxonMobil, Santos Limited, and JX Nippon Oil & Gas Exploration. The bank appears set, though, to remain as the controversial project’s financial advisor, which it became last year amid reports that the consortium was seeking a debt package of US$3–5 billion for construction of the 5.6 million tonnes per year (mtpa) export facility. This latest decision, according to Peter Bosip, the director of the Papuan NGO CELCOR, “shows that Papua LNG is not an acceptable project to finance because of its impact on the climate, the environment and human rights.” Crédit Agricole’s withdrawal was announced just days after Papua’s prime minister disclosed to the national parliament that a final investment decision (FID) for the project would be delayed “by a couple of months,” amid news that cost-conscious Total was concerned about ballooning costs. Reacting to the latest financing blow, the country’s petroleum minister maintained that he had been assured by a Total executive that financing would be secured. (Reclaim Finance, The National, Post-Courier)

Mega Tanzania LNG project stalls: Equinor and Shell are reported to be at loggerheads with the Tanzanian government over one of the world’s most ambitious LNG projects, a US$42 billion export facility slated for development on the country’s southeast coast. A host government agreement (HGA) between the parties for the proposed 10 mtpa terminal has made little headway since July 2023 with reportedly no easy way open to break the deadlock. Tanzania’s Energy Minister Doto Biteko commented little on the situation, saying only that “The HGA is still under negotiation.” A potential and already delayed FID has been targeted for 2025 to allow for construction and then launch of the project by 2031, though concerns are growing that the window of opportunity to realize and market the project is narrowing. “We had hoped to see these agreements signed faster, but we remain ready to continue to work with the government on competitive and investable agreements, consistent with what we agreed last year,” a Shell spokesperson said. (Bloomberg)

New World Bank scenario sees net zero energy within reach for emerging Europe and Central Asia: Identifying a required investment of US$4.7 trillion (3.9% of regional GDP), a new World Bank report lays out pathways for countries in the emerging Europe and Central Asia region to make the shift towards renewable energy and reduce their fossil fuel dependence. The Bank’s Net Zero Energy 2060 target sets out how, with new targets and measures, the share of clean energy in the region’s energy mix could soar from today’s 9% to 75% by 2060. Key deadlines for the still highly coal-dependent region, which comprises 23 countries, include 2040 for power systems across the region to achieve zero net emissions, and 2050 and 2055, respectively, for commercial and residential buildings to reach net zero. A scaling up of energy efficiency can bring about a 40% reduction in energy consumption, according to the Bank’s calculations, while subsidies for coal and gas continue to be a barrier to decarbonization. Stating that the use of gas as an energy source “may be on the decline,” the Net Zero 2060 scenario foresees gas making up 16% of the region’s energy, down from 46% in 2019. (The World Bank)

Biden administration ditches operating gas plants from new pollution regulations: In a concession to major power utilities, the U.S. Environmental Protection Agency (EPA) will not include the nation’s approximately 2,000 gas-fired power plants in a new rule on curbing carbon emissions. Existing coal plants and future gas plants will remain when the rule is finalized next month. The EPA is instead taking a more staggered approach to limiting emissions from operating gas plants, which it says will also include cracking down on other pollutants such as nitrogen oxides and cover existing peaker plants, though this regulation will not be introduced before the U.S. presidential election in November. While under review at the White House in the last few months, the EPA’s original proposal covering operating gas plants received pushback from power utilities who warned that such a move would endanger the reliability of the U.S. power grid. The Clean Air Task force said that, without regulation, the share of power sector carbon pollution from existing gas plants is projected to nearly double by 2040, growing from more than 40% to 70%. (E&E News, Clean Air Task Force)

Solar roadmap shows how to replace planned gas buildout in northern Australia: As a A$1.5 billion (US$1 billion) federal government subsidy scheme advances to develop a major gas and petrochemical export hub near Darwin in Australia’s Northern Territory (NT), new independent economic modeling has set out how the same money could be redeployed to massively scale up solar energy and tap the territory’s abundant sunshine. Among the proposals in the “Recharging the Territory Package” is a A$400 million investment for a Darwin big battery alongside the rollout of community microgrids across the NT. This would be accompanied, among other measures, by energy efficient upgrades to social housing and training and support to develop a remote energy workforce. The fully costed renewables vision follows an announcement from the fracking company Tamboran Resources that it plans to take a FID on an extraction project in the NT’s Beetaloo Basin in June. (Environment Centre NT, Renew Economy)

​German climate ministry floats CCS for gas plants option: Following the approval in recent weeks of a federal government plan to subsidize the construction of 10,000 megawatts (MW) of new hydrogen-ready gas-fired power plants, Germany’s Ministry for Economic Affairs and Climate Action has signaled that it is ready to allow the use of CCS at gas plants, though the technology would not receive state support. The proposal is outlined in a draft carbon management strategy published by the ministry and would be part of moves — though not including coal plants — to introduce CCS in Germany for the first time, where the technology has effectively been banned until now. With no public subsidies seemingly lined up, one industry association noted that it would be up to the market to decide if CCS is taken up. BDEW, a group representing German energy and water industries, said that CCS for gas plants will “depend on costs, infrastructure and flexibility of the installations.” (Argus)

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​The Gas Graph


Via a new Global Energy Monitor data briefing, to achieve the International Energy Agency’s Net Zero Emissions scenario involving a phase out of unabated gas power by 2050, an average of 64,000 megawatts of oil- and gas-fired capacity should come offline each year until 2035, that is, five times the capacity retired annually since 2020. 

Albania: Imports of gas from Azerbaijan via expansion of the Trans Adriatic Pipeline are expected to start up for the first time in 2025 or 2026.   

Brazil: The arrival of a floating storage and regasification unit (FSRU) has marked the start of operations at U.S. company New Fortress Energy’s delayed project site at the mouth of the Amazon River in Pará, northwest Brazil. 

Canada: A Chinese company with gas assets in Alberta has proposed a new 2.7 mtpa LNG plant in Prince George that would rail the fuel to Prince Rupert for export to Asia.

Denmark: Similar to a recently closed investigation in Sweden, Danish investigators have concluded their probe into the Nord Stream pipelines’ explosions, describing them as “deliberate sabotage” but going no further. 

Germany: The first of two planned and hotly disputed FSRUs has arrived at the popular holiday ​​island of Rügen in the Baltic Sea. 

Greece: After receiving a first LNG commissioning cargo in mid-February, the country’s first floating terminal offshore Alexandroupolis is expected to start commercial operations by the end of April. 

Pakistan: Mari Petroleum Company Ltd. has discovered a major gas deposit in the Kohlu District of Balochistan, a conflict-ridden region split into three areas and governed by Afghanistan, Iran, and Pakistan. 

UK: The government’s export finance department is providing a €700 million (US$756 million) guarantee for Ineos, the company owned by billionaire Jim Ratcliffe, who recently became part-owner of Manchester United Football Club, to construct Europe’s biggest petrochemical plant in the Belgian city of Antwerp. 

​U.S.: Despite complaints from residents about loud noise and pollution from fracking activity, a Texas city council has approved the drilling of four new oil and gas wells by a subsidiary of TotalEnergies. 
 

Mozambique finance panic for Total: CEO Patrick Pouyanné is reportedly having “nightmares” over the hesitancy from the U.S. Export-Import (Ex-Im) Bank to release roughly US$4.7 billion in guaranteed loans for the force majeure-hit Mozambique LNG project. Pouyanné and other top Total officials conducted shuttle diplomacy to Washington, D.C., throughout February in efforts to allay concerns from Ex-Im officials about the ongoing security situation in the province of Cabo Delgado. ExxonMobil, developing a separate major project in the northeast of Mozambique, is reported to also be flexing its muscles with Ex-Im in support of Total. State-backed financial institutions in the Netherlands and South Korea are also thought to be having second thoughts about backing the US$20 billion project, potentially waiting to take their cue from Ex-Im’s decision. Africa Intelligence also reports that a hoped-for construction restart before the end of March is rumored to be being rethought at the French company’s Paris headquarters, with the date potentially to be pushed back to September 2024. (Africa Intelligence [paywall]

Qatar to further ramp up LNG production: State-run QatarEnergy has announced plans to add an additional 16 mtpa of LNG production capacity to bring its overall capacity to 142 mtpa by 2030. The company currently produces 77 mtpa, a volume that’s set to start climbing from 2026 as it brings online capacity at its mammoth North Field Expansion project. The jump in production could see the world’s lowest cost LNG producer secure around 25% of the global supply market by 2030, with adverse consequences for delayed projects in Africa and — potentially — North America that are struggling to reach FID. A further consequence may see the additional supply, on top of an already expected post-2026 LNG supply glut, bring down prices to a level appropriate for new Asian LNG market entrants in particular. (Reuters, Reuters)

Europe’s U.S. LNG dependency grew for third year in a row in 2023: The U.S. cemented its position as the top LNG supplier to Europe (EU27 and UK) in 2023 with a 48% share of the market. Data published by the U.S. Energy Information Administration show that U.S. suppliers further boosted their European market share last year from 27% in 2021 and 44% in 2022. Qatar and Russia maintained their positions in 2023 as the continent’s second and third largest LNG suppliers. After record high import levels in 2022, last year saw European import volumes remain broadly static although additional regasification capacity was added, chiefly in western Europe. For the first two months of 2024, according to S&P Global data, the U.S. has maintained its lead supply role with 54% of overall imports, followed by Russia, Algeria, and Qatar. (U.S. Energy Information Administration, S&P Global)

Russian LNG headache for Dutch government: A TotalEnergies contract with a Siberian LNG plant, which is set to run until 2032, is stymying efforts by the Dutch government to end all imports of the fuel from Russia. The French company began a supply agreement with the Yamal LNG terminal in 2018 whereby it receives roughly one cargo per month at the Gate import terminal in Rotterdam, and legal obstacles prevent the government from terminating the contract between Total and Russia’s Novatek. Total boss Patrick Pouyanné has maintained that the company will continue to import Russian LNG at European ports until such time as official European sanctions are introduced. Russia remained Europe’s third-largest LNG supplier in 2023, behind the U.S. and Qatar. (Bloomberg)

​Bulgarian transit pipeline to assume greater importance by end of the year: EU and Bulgarian officials have discussed the importance of the Balkan Stream gas pipeline through Bulgaria once Russian gas transit through Ukraine ends, as expected, at the end of 2024. Balkan Stream traverses Bulgaria, beginning near the Black Sea coast where it is an extension to the TurkStream gas pipeline running from Russia to Türkiye. Although Russian piped gas to Bulgaria was cut off by Moscow following the invasion of Ukraine, Sofia has continued to allow Russian gas to transit to Serbia, Hungary, and ultimately to Austria. The Bulgarian government and state-owned Bulgargaz are still exploring legal options for suing Gazprom for economic damage caused by the shutting off of supplies in April 2022. (EURACTIV [registration required], GEM.wiki, EURACTIV)

France cuts gas consumption by a fifth since 2021 as continent-wide concerns continue to ease: In the latest indication that the EU’s gas-driven energy crisis has substantially eased, the European Commission has proposed to member states the removal of a potentially mandatory requirement for a 15% cut in winter gas usage that was agreed in 2022 during the height of the crisis. While most countries have achieved sizable cuts in winter gas consumption, a voluntary target for a 15% winter reduction is to remain in place. Driven by big cuts in industrial gas consumption, GRTgaz, France’s main transmission operator, has announced that the country has slashed its gas demand by roughly 20% since 2021. At the same time, the head of GRTgaz noted that national gas consumption was expected to remain stable in 2024–2025. While France’s consumption of Russian gas has declined since February, the consultancy Kpler recorded Russian LNG imports still making up 15% of total imports at France’s various import facilities as of the end of 2023. (Reuters, EURACTIV)
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