Major gas merger in the Philippines attracts the attention of regulator: A recently announced US$3.3 billion LNG-related deal is to be scrutinized by the Philippine’s Energy Regulatory Commission (ERC) to assess its potential impact on prices paid by consumers. In early March, three of the country’s biggest power companies — Meralco PowerGen Corporation, Aboitiz Power Corporation, and San Miguel Global Power Holdings Corporation — unveiled plans for a joint investment in two gas plants and the takeover of the Philippines LNG import terminal in Batangas, which is owned and operated by the global infrastructure firm Atlantic, Gulf & Pacific Company. Working in tandem with the Philippine Competition Commission, the ERC review comes amid allegations of “anticompetitive practices” in the country’s power sector. (Philippine Daily Inquirer, Aboitiz Power) 

Governments urged to act as study predicts millions of heat deaths from supermajors’ extraction plans: A first of its kind study, published by the NGO Global Witness, has found that the combined emissions from combusted fossil fuels produced by five supermajors up to 2050 could result in 11.5 million excess deaths from heat by 2100. Applying the “mortality cost of carbon” model formulated by Columbia University to a high emissions scenario for projected combined output from Shell, BP, TotalEnergies, ExxonMobil, and Chevron, the study’s baseline calculation foresees 226 excess heat deaths worldwide for every million tonnes of carbon released. Even under a lower emissions scenario, whereby net zero is achieved globally by 2050, Global Witness estimates that excess deaths associated with the companies’ production would come to about 5.5 million people by 2100. Sarah Biermann Becker, a senior investigator at the group, said that, given the need for an urgent course correction from the five companies, intervention from governments is now needed to rapidly speed up the transition away from fossil fuels. (The Guardian)

More U.S. public finance for fossil fuel expansion: The U.S. Export-Import Bank (EXIM) is under fire from environmental groups following its approval of a US$500 million loan guarantee for a Bapco Energies oil and gas wells project in Bahrain. In the lead up to the funding decision for the scheme, which involves 400 new oil wells and 30 new gas wells, EXIM’s countenancing of the deal resulted in two members of its climate committee resigning in protest two years on from the Biden Administration pledging to stop international public finance support for all fossil fuels. “Even with the White House watching,” said Kate DeAngelis, Senior Program Manager of International Finance for Friends of the Earth, “this institution is willing to uphold and protect extractive industries rather than spending our tax dollars responsibly.” EXIM continues to weigh financing for two controversial gas projects in Guyana and Papua New Guinea. (Friends of the Earth)

Russian shadow hangs over major UK gas supply contract with Total: An £8 billion (US$10 billion), four-year contract with TotalEnergies to supply UK public sector bodies — including the National Health Service and government offices — has drawn strong criticism and accusations of UK government hypocrisy owing to the French company’s continuing ties to Russian gas. Under the contract, which was signed in March 2023, Total will supply gas that it acquires via Britain’s domestic market and therefore, according to a government spokesperson, the “presence of Russian gas is extremely unlikely.” Nevertheless, Total continues to supply Russian LNG to Europe, and that association is causing embarrassment for London, which has recently been boasting about how it is leading the way in clamping down on Russian energy. Industry observers have pointed out that the government could have gone with other companies without Russian ties rather than with Total. (Politico)

Anti-gas protests place European industry event in doubt: According to press reports, one of the European gas industry’s top annual events has been “postponed indefinitely” over concerns about public protests. Due to take place in Vienna on March 26–28, the organizers of the European Gas Conference are reported to be looking into “alternative arrangements” for the event while NGOs have called for it be canceled altogether.  “Gas companies and their lobbyists,” said Amina Guggenbichler from the BlockGas alliance, “obviously don't want to see or hear anything about democratically legitimate climate protests,” said Amina Guggenbichler from BlockGas. Last year’s conference was met by protests in the streets of Vienna and saw the arrests of 165 demonstrators. Last month, the city’s public prosecutor's office dropped charges against all of the accused. (Kronen Zeitung)

Development stuck at major Australian LNG investment project: Industry sources have told Upstream that progress on the Woodside Energy-led Browse LNG project off the west coast of Australia is faltering due, among other things, to the proposed 11.4 million tonnes per year (mtpa) export facility’s high capital costs and technical complexities. Front-end engineering and design contracts for the estimated US$20 billion project are not now expected to materialize while Woodside continues to work on receiving approvals from Australian environmental regulators. Though no commercial supply agreements are known to be in place, the company’s CEO Meg O’Neill has maintained that the government of Japan and Japanese customers are “keen to see the [Browse] development progress.” A further challenge is the need for carbon capture and storage (CCS) technologies at the offshore project in order to, according to a Woodside spokesperson, “abate a significant proportion of Browse reservoir CO2.” (Upstream [paywall], GEM.wiki)

Bangladesh: Twenty-four offshore oil and gas blocks in the Bay of Bengal have been put out to tender in a six-month bidding process for exploration rights that is open to international companies. 

Cyprus: Agreement has been reached between the government and the Chinese CPP consortium to recommence construction of the Vassiliko LNG import terminal, though a project timetable has still to be confirmed. The Cypriot authorities risk losing 20% of a €101 million (US$110 million) grant from the European Commission if the facility is not completed by December 31 this year.

Egypt: Chevron is expected to start drilling the eastern Mediterranean Nargis 2 gas field before the end of this year as part of a US$3 billion investment over the next two years. 

Germany: After a six-year development phase, the promoters of the Stade LNG import terminal, Germany’s first onshore terminal, have taken a final investment decision (FID) for the €1 billion (US$1.1 billion) project.  

Nigeria: A FID for the country’s first floating LNG project, in line for US$5 billion financing support from the African Export-Import Bank, has been further delayed to the second half of this year. 

Ukraine: State-owned Naftogaz has held talks with the French government, TotalEnergies, and ENGIE aimed at increasing the gas volumes held by French companies in Ukraine’s underground storage facilities.

UK: Net Zero Teesside Power and Northern Endurance Partnership, joint ventures involving BP, Equinor, and TotalEnergies, have announced the awarding of around £4 billion (US$5 billion) worth of CCS contracts, including for a proposed 860 megawatts gas plant in northeast England. 

UK: While it undertakes an official review, Cambridge University has temporarily stopped accepting funding for research from fossil fuel companies including BP and Shell following pressure from students and academics.

Gas trading increasingly central to commodity traders’ mega profits: Spectacular increases in the trading of gas and power since 2018 have resulted in soaring profits for commodity traders, according to new research by the management consultancy firm Oliver Wyman. Gas and power have eclipsed oil as the principal money-maker for a diverse set of traders including banks, hedge funds, and the trading arms of major oil and gas companies. Independent traders such as Vitol and Gunvor, which continue to benefit from state-backed funding support from export credit agencies for LNG trading most notably, are a further branch of the sector that Oliver Wyman’s study estimates to be sitting on accumulated reserves of between US$70 billion and US$120 billion. Other than continuing to award executives and employees eye-watering salaries and bonuses, industry observers are predicting that commodity traders will seek to consolidate their dominance by buying up, among other things, fossil fuel assets. Swiss-based Gunvor’s purchase of a Spanish gas power plant from BP at the end of last year is likely to be a foretaste of similar acquisitions going forward. (Financial Times)

Petronas focusing on upstream gas and CCS amid more challenging financial environment: Announcing profits of US$17.1 billion in 2023, a 21% drop compared to 2022, state-owned Petronas also oversaw a 41% increase in capital expenditure last year chiefly as a result of domestic upstream gas and CCS activities. The spending increase is mainly due to continuing development of the Kasawari gas field and associated CCS facilities in Sarawak, Petronas’ first investment in the abatement technology. While CEO Tengku Muhammad Taufik acknowledged that the company’s financial position had been weakened due to “softer than expected economic performance towards the end of 2023,” he maintained that its focus remained on “striking the right balance between strengthening our core business and capturing opportunities in new business, including clean energy solutions, while responsibly managing carbon emissions in line with our Energy Transition Strategy.” (Upstream [paywall])

Fossil fuel companies come together to push electric natural gas: Mitsubishi, TotalEnergies, and Germany’s TES are among seven companies that have agreed to form an international alliance aimed at supporting the development and production of electric natural gas (e-NG). To be known as the e-NG coalition, the participating companies believe that e-NG can boost energy transition efforts by accelerating the development of renewable hydrogen. According to Mitsubishi, e-NG is a synthetic gas produced from renewable hydrogen and carbon dioxide and can be transported and stored utilizing existing gas infrastructure. (Reuters)

Further problems stack up for Tellurian: The U.S. pipeline operator Williams Companies has underscored the difficulties faced by Tellurian and its proposed Driftwood LNG export facility in Louisiana by confirming that it had walked away from a potential takeover of the troubled U.S. LNG developer. As long-term sales and purchase agreements continue to prove elusive for the Driftwood project, thus undermining its chances of securing project finance, the executive vice president of Williams disclosed that its scrutiny of Driftwood had resulted in a negative appraisal. “There is the advantage of it being permitted, it does have a speed to market that is interesting to us,” said Chad Zamarin of the estimated US$30 billion Louisiana project, “but it does not have the commercial contracts on the demand side.” Following Tellurian’s ousting of chairman and co-founder Charif Souki last year, CEO Octavia Simoes has also stepped down as the company continues to look for a potential buyer. (Reuters, Reuters) 

Official data confirm 2023’s consolidation boom in U.S. exploration and production sector: Data compiled by the U.S. Energy Information Administration (EIA) have confirmed that spending devoted to mergers and acquisitions in 2023 by exploration and production companies in the American oil and gas sector rose sharply in 2023 to US$234 billion. When adjusted for inflation, the total dollar spend was the highest since 2012. Referencing eight significant deals that were finalized or announced last year, the EIA noted that — subject to regulatory approval — ExxonMobil was set to become the top U.S. producer of oil and natural gas liquids with a market share of 7%. Pending the finalization of a deal to acquire Hess Corporation, Chevron will become the nation’s second biggest producer with a 6% share. (U.S. EIA)

Anatomy of the European Industrial Gas Demand Drop, Center on Global Energy Policy at Columbia University, March 18, 2024. 

This commentary analyzes the present state of EU industrial gas consumption and explores the potential causes for ongoing weakness in gas demand across the bloc.

Shell vs. the Climate: Expanding Oil and Gas, Fueling the Climate Crisis, Oil Change International and Milieudefensie, March 18, 2024. (Pdf)

This 38-page briefing provides an overview of Shell’s investment activities — including the sanctioning of 20 new major oil and gas projects — since May 2021 when a Dutch court ordered the company to reduce its emissions by 45%.