October 12, 2023
Issue 56  |  View Past Issues
Inside Gas
Published by Global Energy Monitor

Editor's Note

Industry commentators can be quick to sneer at efforts by campaigners to pressure financial institutions into shunning fossil fuel projects and clients. The funding can always come from “somewhere,” the argument usually goes. As seen with the positive effects of coal finance restrictions over the last ten years, however, there is now a growing groundswell of banks and other institutions that are cracking down on oil and gas just as they ramp up their exposure to clean energy investments — and anguished comments from Malaysia’s state-owned oil and gas company provide the proof of the rapidly changing financial reality. 

One gas company not saying too much is Karpowership following fresh controversy over its big money gas powership plans in South Africa and political calls for it to get out of the country’s energy sector altogether. TotalEnergies has gone very long on an LNG supply contract with Qatar while serious questions are being asked about what it did or didn’t do during an eruption of widely-predicted, fatal violence close to its Mozambique LNG project two years ago. The company’s long-term gas plans, like those of others, may be in for some disruption if measures to curb methane emissions from gas imported to Europe are adopted into EU law — measures that are reportedly being actively promoted by the French government.

Grieg Aitken


How big oil and gas discusses the energy transition 

At the recent 24th World Petroleum Congress in Calgary, every solution to get the industry to net zero was discussed except an end to the burning of fossil fuels, writes Michaela Cavanagh in the London Review of Books

“After two nights in prison I feel stronger than before”

A peaceful protest action in the Port of Zeebrugge earlier this year against increased imports of U.S. LNG led to the police detention of Greenpeace activists, 14 of whom are now facing prosecution. Four of the activists — Nina, Juri, Kelly, and Paula — describe their experience. 

IEA forecasts have ignited debate over the future of gas

Industry may be trying to push back hard on recent forecasts from the International Energy Agency predicting increasingly steep falls in gas demand and supply, but there are signs that some companies are becoming less bullish about the fuel’s future, writes Paul Merollo in Energy Intelligence.

Europe’s gas stocks sorted for winter

Over the last ten years, Europe’s largest drawdown of gas from storage facilities during a single winter heating season was 782 terawatt-hours. With the continent’s inventories standing at 1,096 TWh at the end of September, it’s almost guaranteed that shortages will be avoided this winter regardless of the weather, writes John Kemp for Reuters.  

Top News

TotalEnergies accused of involuntary manslaughter over Mozambique terrorist attack: Three survivors of a Jihadist attack in the northeastern Mozambique town of Palma and four relatives of those killed have filed a criminal complaint with French prosecutors alleging that TotalEnergies “failed to take necessary measures to ensure the safety of subcontractors” during the attack in March 2021. At the time, the French company was building the US$20 billion Mozambique LNG export facility in the region, work on which may resume shortly after a two-and-a-half year pause. The complainants allege that Total failed to warn subcontractors of the attack, lacked a proper security plan for evacuating the LNG project, and refused to give fuel to a South African private security contractor that attempted a helicopter rescue after the assault took place. In a detailed response, Total said its evacuation plan for “all personnel” working on the LNG terminal site, including “Mozambique LNG’s contractors and their subcontractors,” was implemented in the aftermath of the Palma attack. If the complaint is not rejected by the public prosecutor’s office in Nanterre, a preliminary inquiry would follow before a potential prosecution case. (Euronews, Reuters, Financial Times, Energy-pedia News)

EastMed gas disrupted by latest outbreak of violence: The temporary closure of Chevron’s Tamar gas field in the East Mediterranean, ordered by Israel’s energy ministry amid worsening security conditions, is expected to hamper recently announced plans by Egypt to restart LNG exporting, threatening deliveries to Europe. The shut-in of the Tamar platform was reported to have led to an immediate 20% drop in Israel’s gas shipments to its neighbor with the duration of the Tamar outage unknown and the Israeli energy ministry prepared to declare a state of emergency across the country’s gas sector in the next two weeks if necessary. With two available export terminals, Egypt exported only one LNG cargo in August and none in September due to high domestic gas demand this summer. “When we are looking at the upstream sector in Egypt, we have already seen that it is struggling to keep up pace with rapidly rising domestic consumption as well as LNG exports,” commented Gergely Molnar, a gas analyst at the International Energy Agency. Production is continuing at Israel’s other two key gas fields — Leviathan and Karish — where the focus is on meeting Israel's own energy security needs, according to industry sources, who also warned that a protracted conflict could impact the prospects of a range of new gas ventures in the East Mediterranean region. (Bloomberg, S&P Global, Energy Intelligence) 

France backs new import standard as EU Methane Regulation negotiations near conclusion: As EU countries and lawmakers rush to have a new law — designed to reduce methane emissions in the energy sector — signed off before the start of COP28 at the end of November, the French government has intervened to give its backing to proposed rules that would impose methane emissions limits on gas imports from 2026. Paris has circulated a document to other member states outlining a proposal for importers to prove by 2026 that 70% of their fossil fuel imports comply with EU methane rules, with the share increasing each year until 100% are covered in 2029. The EU is dependent on imports for over 80% of its gas consumption. Agreement on and implementation of such a methane import standard, according to analysis from the NGO Clean Air Task Force, could not only bring about cuts in global methane emissions in the oil and gas sector of more than 30% but also result in €54 billion (US$57 billion) in savings for exporting countries. Ahead of the final negotiations on the EU Methane Regulation, InfluenceMap identified efforts from a number of global industry associations to weaken the climate ambition of the new rules. The American Petroleum Institute, Eurogas, and the International Association of Oil & Gas Producers were among the industry groups to have pressured European policymakers to exclude imported fossil fuels from the regulation, the non-profit think tank noted. (Reuters, Clean Air Task Force, Influence Map)

IEA forecasts slowdown in global gas demand growth out to 2026: The International Energy Agency (IEA) has kept up its prognosis that an end to the “golden age of gas” has arrived in its new Gas 2023 Medium-Term Market report, although emerging economies — particularly China — are expected to buttress global demand in the next few years. The IEA predicts that since gas demand peaked in mature markets such as Europe and North America in 2021 due to subsequent accelerated uptake of renewable energy and energy efficiency measures, growth in overall global gas demand between 2022 and 2026 will slow to an average of 1.6% a year, down from average annual rise of 2.5% between 2017 and 2021. “After their heyday between 2011 and 2021,” said Keisuke Sadamori, the IEA’s director of energy markets and security, “the world’s gas markets have entered a new and more uncertain period that is likely to be characterised by slower growth and higher volatility — and could lead to a peak in global demand by the end of this decade. Different trends are playing out across different regions, with demand declining in mature markets but continuing to grow in emerging and developing economies.” China’s gas demand, driven by post-Covid industrial needs, is forecast to grow by almost 40% through 2026, though this represents a decrease in the country’s rate of demand growth compared to 2017–2021. (IEA, Reuters)

More pipeline sabotage suspected in the Baltic Sea: A leak that brought about the closure of the Balticconnector gas pipeline running between Estonia and Finland across the Baltic Sea is likely to have been caused by damage resulting from “external activity,” according to Sauli Niinistö, Finland’s president. The Finnish authorities have so far chosen not to publicly jump to conclusions about who or what was behind the damage to the 155-kilometer bidirectional pipeline, but ruled out a pipeline fault, pressure fluctuations, and seismic activity. However, Finnish media has been rife with speculation about Russian sabotage following reports that the Russian hydrographic survey vessel Sibiryakov was observed several times in the pipeline’s vicinity over the last few months. While no conclusive proof has been provided, one suggested motive is Finland’s accession to NATO last April. The pipeline’s operators expect it to be out of service for at least five months, though this should have no significant impact on gas supplies to Finland or Estonia due to the availability of LNG imports and storage gas in Latvia. (Argus, The Guardian, ERR News)

Black Sea gas financing in the spotlight: Debate over the financing of the €4 billion (US$4.25 billion) Neptun Deep gas field in the Black Sea, which reached a final investment decision in June, is intensifying as environmental groups in Romania and across the region question the potential award of additional EU public money for the project and its associated infrastructure. The Tuzla-Podisor gas pipeline, now under construction to link the offshore project to the BRUA pipeline and then deliver gas to Hungary and Austria, has already received €150 million in loans from the European Investment Bank and €85 million from the EU’s Modernisation Fund, a funding programme set up to help lower- income EU member states achieve climate neutrality. At a meeting with her Romanian counterpart in Budapest, Hungary’s president Katalin Novak called on the EU to fund Neptun while indicating that supply discussions are underway between the two countries. CEE Bankwatch Network has estimated that the field, which holds approximately 100 billion cubic meters of gas, would emit 18 million metric tons of CO2 per year, equivalent to the total annual emissions currently produced by Romania’s electricity sector. (Euronews, Euractiv [registration required]) 


Germany: High electricity and gas prices have driven a striking increase in the country’s energy poverty, according to a report from the Expert Council for Consumer Affairs, with average monthly payments for electricity and gas rising by €52 (US$55) from the start of the energy crisis in March 2022 to June 2023.

Montenegro: A senior European official has said that the EU is ready to partner with the western Balkan country on the development of the proposed Bar LNG import terminal, which could receive EU public funding support.

Mozambique: Italy’s Eni is reported to be aiming for a final investment decision on the Coral North floating export terminal in the first half of next year. 

Russia: Novatek’s proposed 20.4 million tons per year (mtpa) capacity Murmansk LNG export terminal north of the Arctic Circle has been granted priority approval from the Kremlin as a strategic project.

South Africa: A long-delayed gas “master plan” has been drafted and is set to be presented to the government before being made available for public comment by the end of the year. 

UK: CO2 emissions at SSE’s Peterhead gas power station near Aberdeen increased by 20% in 2022 to over 1.3 million tonnes, according to data from the Scottish Environment Protection Agency, making it Scotland’s single dirtiest industrial site.

U.S.: No casualties were reported after a gas pipeline explosion in the state of Arkansas caused a major fire and a mile-wide evacuation of local residents. 

Uzbekistan: Under a two-year deal, Russia has started supplying gas to Uzbekistan for the first time with volumes of roughly 2.8 billion cubic meters per year to be delivered. 

Companies + Markets

National oil companies feeling the squeeze from financing restrictions: As international banks increasingly restrict their lending to the oil and gas industry, national oil companies — particularly in non-OECD countries — are finding it difficult to finance fossil fuel projects, according to soundings taken by the Energy Intelligence website. Malaysia’s state-owned Petronas has been one of the most vocal in describing the growing challenges involved in sourcing funding, most notably from European lenders, and says other companies are now in the same boat. The commitment earlier this year by French bank BNP Paribas to stop financing the development of new oil and gas fields has been keenly felt by Petronas, which is also struggling to get LNG and carbon capture and storage projects off the ground as banks try to meet their own emissions goals. An unnamed source at the Nigerian National Petroleum Corporation told Energy Intelligence that some multilateral banks such as Afreximbank remain an option, but the “depth of their pocket is limited in comparison with private banks.” One solution, being considered by Petronas, is for companies to increase their cash reserves to be able to self-fund a larger share of major projects. (Energy Intelligence)

Allegations of more murky dealings emerge over Karpowership’s South African plans: Shadow Minister of Mineral Resources and Energy Kevin Mileham, a member of the opposition Democratic Alliance party, has called for the government to cancel Karpowership’s preferred bidder status for a highly lucrative procurement programme to supply gas power to state utility Eskom following a court’s release of a previously confidential document. Mileham argued that Karpowership’s majority position vis-a-vis the Risk Mitigation IPP Procurement Programme, estimated to be worth R218 billion (US$6.7 billion), has become “legally untenable” following what he described as “startling allegations of influence peddling and ‘quid pro quo’ machinations to secure permits and control of gas terminals.” The draft memorandum of understanding document, which contains details of a proposal to trade influence and deals to secure permits for Karpowership’s floating gas power plants at several ports in the Eastern Cape, came to light during a court battle in the Johannesburg high court last month between Turkish powership company Karadeniz and its estranged partner in the Karpowership joint venture. The allegations currently swirling come as Karpowership awaits permitting decisions from the South African government. Shadow minister Mileham additionally called for Karpowership to be barred from further participation in the country’s energy sector. (News24, Democratic Alliance)

TotalEnergies signs up for Qatari LNG to 2053: In one of the longest LNG supply agreements ever signed, QatarEnergies and TotalEnergies have inked a 27-year deal for the delivery of 3.5 mtpa of LNG to the Fos Cavaou import terminal in southern France. Under the contracted terms, cargoes will be sent from Qatar’s North Field East (NFE) and North Field South (NFS) projects — in which the French company holds minority stakes — starting in 2026, potentially undermining France’s 2050 net zero target in the absence of offsets to cancel out any burnt methane beyond that date. New analysis from the Institute for Energy Economics and Financial Analysis (IEEFA) has questioned why France is building out new LNG import infrastructure, such as a new floating terminal at Le Havre planned for a five-year lifetime, when the country’s gas consumption hit a ten-year low in August. IEEFA also raised concerns that Russia remained France’s second largest LNG supplier — behind the U.S. — in 2022 and in the first half of this year in spite of aspirations to end Russian gas dependency. (Reuters, IEEFA [Pdf])  

Chevron LNG labor dispute flares up again in Australia: Union representatives and Chevron have appeared before Australia’s industrial arbitrator, the Fair Work Commission, for a second time in as many weeks after failure to conclude a bargaining agreement reached last month led workers at the company’s Gorgon and Wheatstone LNG to vote for the restart of strike action from October 19. An official from the Offshore Alliance, a coalition of two unions, accused Chevron of “bad faith” during bargaining that has gone on with the workforce over the last year, though progress was reported to have been made in the latest round of talks. Australian and Japanese government officials, meanwhile, have reached a verbal agreement over a continued “stable supply of resources such as LNG and a reliable investment environment” in Australia’s resources and energy sector, according to Japan's Economy, Trade and Industry Minister Yasutoshi Nishimura. Officials from the Japanese government and industry continue to be outspoken about the cost implications of legally binding emission cutting targets for new and existing LNG facilities that were introduced by Canberra in July. (Upstream, Reuters, The Mainichi) 

South Korean LNG power plant to get pilot CCS facility: The Korean energy company SK E&S has announced plans to build a carbon capture and storage demonstration facility at one of its LNG-fired power plants in a joint development agreement with U.S. petrochemical firm Honeywell UOP. SK E&S said that the project, planned to start operating in 2026–2027, would be the first attempt from a private-sector firm to build its own dedicated facilities to demonstrate CCS for LNG power generation. Honeywell UOP claims its CCS technology is able to capture more than 95% of emitted CO2 and will be installed at one of the Korean company’s three plants near Seoul that have over 1,000 megawatts capacity. (Argus) 

Gazprom looks to nuclear to power Sakhalin gas fields: According to reporting from the Kommersant newspaper, the state-owned gas company has begun talks with Russia’s nuclear power firm Rosatom on potentially powering gas extraction with floating nuclear power plants (NPPs) in fields off the coast of Sakhalin Island in the country’s far east. NPPs with power capacity of up to 116 megawatts are among the external power supply options being considered for the Gazprom-owned Kirinskoye and Yuzhno-Kirinskoye fields. (Newsbase)


Africa Gas Factsheet: The Climate Case Against Gas Expansion, Oil Change International, October 9, 2023. [Pdf]

This 8-page briefing describes the negative impact on climate goals, sustainable development, and environmental justice if more than 20,000 kilometers of planned gas pipelines, close to 30 gas extraction areas, and other industry expansion plans are realized across the continent.  

Gas does not equal development: Why public finance for fossil gas is not the solution for women in Asia and Africa, Recourse et al, October 10, 2023. [Pdf]

This 30-page report provides analysis into how gas funding provided by multilateral development banks in Asia Pacific and Africa is driving climate change and presents case studies from Senegal, Mozambique, Pakistan, and Bangladesh documenting how financed gas projects are perpetuating gender inequality.