Small methane leakage rates from gas systems rival coal’s greenhouse gas emissions — new peer-reviewed analysis: As little as a 0.2% methane leakage rate from gas wells, production facilities, and pipelines can make gas as big a driver of climate change as coal, according to a new analysis coauthored by scientists from RMI, NASA, Harvard University, and Duke University. This latest challenge to the gas industry, published in the scientific journal Environmental Research Letters, takes on the misconceptions thrown up by simple coal-to-gas comparisons that consider only end-use combustion and reveals how methane leakages across the entire gas supply chain result in emissions parity between gas and coal. The analysis refers to recent surveys of U.S. oil and gas production basins that have found gas leakage rates of 0.65% to 66.2%, with similar rates also detected around the world. The 0.2% leakage parity figure makes “methane cuts an immediately actionable step to prevent waste and avoid catastrophe,” according to RMI. (RMI, NPR) 

Voluntary “CLEAN” initiative launched to curb LNG sector’s methane emissions: As the oil and gas industry comes under increasing pressure to reduce its methane emissions, a no-regrets effort in the first place that requires tackling its notoriously leaky value chains, Japan, the U.S, South Korea, Australia, and the EU signed a joint statement during the LNG Producer-Consumer Conference in Tokyo to support methane reduction measures from production to consumption in the LNG sector. Participation in the new initiative dubbed CLEAN — the “Coalition for LNG emission abatement towards net zero” — will be voluntary and involves the creation of a database of real-time pollution data for individual LNG projects. Greater transparency on methane emissions will also be sought via data collection at the cargo, portfolio, and operator levels, the signatories announced. While details about the public-private initiative remain sketchy for now, Japan’s Jera and South Korea’s Kogas, two of the world’s largest LNG buyers, have been tasked with pressuring major producers to participate and will also work with the government-backed Japan Organization for Metals and Energy Security to collect and ultimately disclose data. (The Financial Times [Paywall], Bloomberg)

EU energy regulator criticizes ten-year gas and hydrogen network development plans: The EU’s Agency for the Cooperation of Energy Regulators (ACER), the bloc’s independent energy regulator, has questioned both the “unprecedentedly high” investment costs and the excessive amount of proposed gas infrastructure contained in the draft Ten-Year Network Development Plan (TYNDP) for the gas and hydrogen sectors published for consultation by the European Network of Transmission System Operators for Gas (ENTSOG). Hydrogen projects are included in the TYNDP for the first time and are driving the significant rise in capital expenditure estimates — €110 billion (US$123 billion) overall, with hydrogen comprising roughly 70% of these costs — put forward to ENTSOG by project promoters from around the EU. In ACER’s view, Europe’s gas network is already “well developed and resilient,” and the agency “finds it difficult to understand” why so much conventional gas infrastructure is included in the TYNDP given that “ENTSOG and many other parties foresee a significant reduction of natural gas demand in Europe from the year 2030 onwards.” Separately, the International Energy Agency has warned of the potential for renewed European gas market volatility this winter. This could materialize, said the IEA, if there is “a cold winter, together with a full halt in Russia piped gas supplies to Europe early in the heating season.” (ACER Opinion [Pdf], ACER press release, Bloomberg)

Germany’s new LNG terminals account for 6.4% of imports in first half of the year: Data from Bundesnetzagentur (the Federal Network Agency) indicate that the three new LNG import terminals that have started up this year at the ports of Wilhelmshaven, Brunsbüttel, and Lubmin have handled only 33.8 terawatt hours of gas out of a total of around 526 terawatt hours that have been imported in the first six months of 2023. While Norway has supplied almost half of Germany’s imports so far this year, most of the country’s LNG was provided by U.S. suppliers, with the floating Wilhelmshaven terminal importing the bulk of it. Questions continue to be raised over whether an excess of LNG import capacity has been commissioned with backing from the federal government. Berlin expects additional terminals due online this year to take import capacity to 13.5 billion cubic meters (bcm) of gas, or more than 130 terawatt hours, equivalent to roughly four times the volume of LNG imported so far this year. By 2027, Germany’s import capacity could hit 54 bcm. (Tagesschau [German])

Inhalation concerns persist for U.S. oil and gas workers: The inhalation of oil and gas vapors from storage tanks continues to cause fatalities and long-term health issues for industry workers, but regulations to tackle the problem in the U.S. are still missing in spite of warnings from federal agencies. The process of “manual gauging,” where workers open the hatches atop tanks to test the fluid inside before pumping it into trucks, is reckoned to have left at least 20 workers dead since 2010, though this figure is thought to be an underestimate. The risks of manual gauging can be avoided through the use of electronic gauging devices, which are increasingly common on tanks on federal land managed by the Bureau of Land Management and on new tanks, but manual gauging is said to still be a common practice on private land. A 2013 study by the CDC, the U.S. public health agency, found that the fatality rate for oil and gas industry workers was seven times higher than the national average. (Drilled) 

Research reveals hydrogen push on Scottish government by fossil fuel lobby: New research from campaign group Friends of the Earth Scotland shows that in recent years representatives from the oil and gas industry met with Scottish government ministers on more than 30 occasions to discuss hydrogen development. Between March 2018 and the end of 2022, and based on examination of both ministerial diaries and the Scottish parliament’s Lobbying Register, an additional 70 meetings took place with companies who stand to benefit from the roll out of hydrogen technology in Scotland. According to official records, a January 2021 meeting between Shell and then Energy Minister Paul Wheelhouse involved the oil and gas company emphasizing the importance of both blue and green hydrogen. Fossil fuel-derived blue hydrogen has been referred to by ministers as “low carbon,” and a £100 million (US$129 million) government subsidy commitment for the industry has so far not ruled out support for blue hydrogen. (The Herald)

Argentina blocks a Russian LNG cargo, Finland restarts delivery from St. Petersburg terminal: Although Argentina has not adopted any sanctions against Russia, economy minister Sergio Massa told local media that a cargo of Russian LNG delivered by commodities trader Gunvor to the Bahia Blanca terminal was turned away due to sanctions on July 18. The shipment of Russian gas was loaded at France’s Montoir-de-Bretagne export terminal on June 25 and carried to Argentina by the Flex Artemis vessel. Gunvor has rejected the minister’s claims, insisting that “the transaction complies with all applicable economic sanctions.” Meanwhile, after a lull in deliveries since April, earlier this month Finland’s Gasum resumed LNG purchases from the Vysotsk export terminal owned by Russia's Novatek, according to ship-tracking data. (Bloomberg, Reuters) 

The Gas Graph


Portfolio players, including BP, Shell, and commodity traders such as Gunvor, Vitol, and Trafigura, are responsible for more than 50% of global LNG purchase agreements signed since 2022.

Argentina: With Buenos Aires looking to boost its LNG export industry by 2027, Argentina and the European Commission have signed a non-binding agreement that seeks to ensure a stable supply of LNG to the EU, cooperation on hydrogen and renewable energy development, and reducing methane leakages in the gas supply chain. 

Australia: A complaint made by law firm Environmental Defenders Office on behalf of nonprofit groups Comms Declare and Lock the Gate against a TV advert from the Australian Petroleum Production & Exploration Association lead to Australia’s advertising watchdog banning the ad on the grounds that it made unsubstantiated and misleading claims about the “green” credentials of gas.

Europe: Data analysis from European NGO Transport & Environment shows that LNG carriers were a key driver behind a 3% rise in carbon emissions from Europe’s shipping sector in 2022. 

India: Indian Oil Corporation has signed a 14-year, US$7-$9 billion deal with Abu Dhabi's ADNOC Gas to receive 1.2 million tons per year (mtpa) of LNG.

Ireland: Microsoft has secured permission to operate and is close to completing a 170 megawatt gas-fired back-up power facility on the site of its €900 million (US$1 billion) data center development in Dublin. The company says it expects the power plant to run for eight hours a day, 365 days a year.

Mexico: State utility CFE has agreed to supply Mexico Pacific Limited with 40% of the feed gas for the proposed US$14 billion Saguaro Energía LNG export terminal in Puerto Libertad. 

UK: In its latest report on fiscal risks to the UK economy, the Office for Budget Responsibility — a widely respected public body funded by the UK’s finance ministry — said the country remained one of the “most gas-dependent economies in Europe” and warned of the catastrophic effects for the economy if overreliance on gas continues.

U.S.: Houston-based Callon Permian has been fined US$1.3 million by the U.S. Environmental Protection Agency following the detection of excess emissions of methane and volatile organic compounds at thirteen of its oil and gas production facilities in the Permian Basin.

U.S.: Kinder Morgan and Howard Energy Partners have announced the expansion of their Eagle Ford Shale pipeline networks to boost supply to U.S. Gulf Coast export markets by two billion cubic feet per day. 

Pakistan’s government mulls inflated LNG supply offer: Pakistan’s travails as an LNG buyer appear to be continuing despite receiving its first offer from a supplier in over a year. Trafigura responded positively to a spot market tender for delivery of LNG cargoes in January and February; however, the commodities trader’s offer was priced roughly 30% higher than the current market rate, though spot market purchases tend to be sold at current market prices. Trafigura’s inflated offer came after approval from the International Monetary Fund of a US$3 billion bailout for Pakistan that should help to contain the worries of LNG suppliers of a potential debt default by the country, which has faced acute financial difficulties for more than a year. The Islamabad government, which is due to make a decision on the Trafigura offer by the end of this month, has confirmed that LNG has replaced oil as Pakistan’s most expensive power source. (Bloomberg, Dawn, Dawn)

More taxpayer-funded support for U.S. LNG sales to Europe: Commodities trader Trafigura has secured another state-backed funding arrangement, this time from the Export-Import Bank of the United States (EXIM), that will underwrite the purchase of U.S. LNG for sale to primarily European buyers. EXIM’s board of directors agreed to insure US$400 million in credit facilities that Citibank and Crédit Agricole can then provide to Trafigura for LNG purchasing and selling. Last year, to enable the purchase of significant quantities of U.S. LNG, the German government guaranteed a US$3 billion commercial bank loan to Trafigura. U.S. NGOs slammed the financing decision that sees the Biden administration again supporting companies that are contributing to the climate crisis. Kate DeAngelis of Friends of the Earth United States commented that the support extended to Trafigura “will only advance the further buildout of dirty and dangerous liquefied natural gas export facilities that perpetuate environmental injustices in [U.S] Gulf communities.” (Export-Import Bank of the United States, Sierra Club)

Price gouging prosecution for South Africa’s monopoly piped gas supplier: Sasol Gas is being prosecuted by South Africa’s Competition Commission on charges of marking up piped gas prices by as much as 72% for almost a decade. The case is to be heard by the country’s Competition Tribunal, though a date has yet to be set, and follows three complaints about excessive pricing from gas traders and an association of large industrial gas users that have been reliant on Sasol, which sources gas from fields in neighboring Mozambique. An investigation by the commission also found that Sasol’s pricing regime had impacted end-consumers. Sasol did not cooperate with the investigation, which left the commission to calculate the price gouging based on available market information. Instead, the company chose to file a legal review application in the Competition Appeal Court challenging the commission’s jurisdiction to investigate the three complaints. (News24)

Japan makes significant moves on coordination and state financing: The EU and Japan have agreed to step up cooperation efforts aimed at strengthening global LNG “architecture,” principally to help avoid future abrupt supply shocks like those that rocked LNG markets last year. The announcement is aligned to another Japanese proposal set out at the LNG Producer-Consumer Conference in Tokyo for the International Energy Agency to establish a global stockpile framework for gas, similar to the emergency reserve in the oil sector, to help avoid future shortages and stabilize prices. In a further sign of Tokyo’s determination to pull out all the stops in support of LNG procurement amidst still highly uncertain market conditions, state-backed insurance is already being offered to effectively guarantee bank loans used to buy LNG under short-term contracts. The Ministry of Economy, Trade and Industry, which has played a key role in developing Japan’s global LNG reach for decades, is also set to announce a new trade insurance mechanism for the sector. (S&P Global, Bloomberg, Nikkei [Paywall])

Question marks emerging already over Vietnam’s turn to LNG: Reuters reports that, following the publication in May of Vietnam’s US$135 billion electricity roadmap, there are growing concerns from industry insiders that the government’s plans for a big new role for LNG imports are running up against various hurdles that will hinder the fuel’s ability to ease the country’s long standing power crisis. Although this month has seen the delivery of Vietnam’s first LNG cargo (for testing purposes) as well as a final investment decision for the US$1.3 billion Son My LNG import terminal, the first LNG-supplied power plant — Nhon Trach 3 — is rumored to be running two to three years behind its 2024 start date. An underlying issue is a dispute over long-term power pricing between state-run PetroVietnam Power and grid operator EVN. Uncertainty on the pricing terms is having knock-on effects for power plant developers — including Japanese and U.S. investors — who are seeking state guarantees on their power contracts with EVN, which they say are necessary to secure loans from financial institutions. There are also early indications that Vietnamese LNG buyers are struggling to find the funds to secure medium-to-long term import contracts. (Reuters) 

Greece’s regional gas exporting is on the rise: Mid-year data from national gas grid operator DESFA indicate that Greece’s ambition to become a gas transit hub for Southeastern Europe is taking shape. While several import terminals are in development, the Revithoussa terminal — currently the country’s only operating terminal off the coast from Athens — recorded a 7.87% increase in import volumes compared to the first half of 2022, with U.S. and Russian LNG comprising more than 60% of the total imports. As domestic gas consumption dropped by 21.74% in the first half of the year, Greek gas exports rose by 15.03% compared to the corresponding period last year. DESFA said it was confident about the potential for enhanced exporting to neighboring countries in the Balkans. The first, non-binding phase of a recently conducted market test saw interest from 27 companies, of which 45% are based in the EU and the rest in third countries. DESFA is also advancing a 540-kilometer, €1 billion (US$1.12 billion) hydrogen pipeline between Greece and Bulgaria that has been deemed eligible for inclusion in the EU’s Projects of Common Interest list. (DESFA, Kathimerini, Reuters)

Offshore, commissioned by Platform London with support from Friends of the Earth Scotland, July 2023.

This 20-minute documentary, which tells the story of UK offshore oil and gas workers and their hopes for the coming energy transition, is now available online.