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Post by Blitz on Jan 3, 2022 10:27:28 GMT -5
As people get cold in the winter with rising heating costs and wind, solar, and nuke issues too, it gets easier to see the woke-ESG argument as illogical over at least the next 10-15 years. The infighting has begun... /////////////////////// Germany, Austria blast EU’s “greenwashing” of natural gas projects By EWA KRUKOWSKA, IAIN ROGERS AND JONATHAN TIRONE on 1/3/2022 www.worldoil.com/news/2022/1/3/germany-austria-blast-eu-s-greenwashing-of-natural-gas-projects(Bloomberg) --Germany and Austria came out strongly against the European Union proposal to classify some natural-gas and nuclear projects as sustainable investments, with both countries accusing the bloc of “greenwashing.” In Berlin, the Greens -- who joined Germany’s new ruling coalition following September’s election -- criticized the regulatory plan as damaging the credibility of the EU green rulebook, known as taxonomy, and threatening to divert investment away from renewables. The country is phasing out nuclear energy and wants to shut all its atomic power plants by year’s end. “It’s a kind of greenwashing that we shouldn’t support,” Ricarda Lang, a deputy leader of the party, told ARD television Monday. “That means that Germany cannot sign up to this proposal on EU taxonomy.” Opponents are pressuring the European Commission to modify its plan, knowing they face a difficult task in trying to block it at a later stage. The commission is using a special scrutiny procedure that would require at least 20 member states -- representing at least 65% of the EU’s population -- to collectively reject the rule in coming months, which is very unlikely. Several key countries, including France, strongly support the inclusion of nuclear power. In a proposal sent for consultations to member states Friday, the commission wants to put a temporary green label on gas projects that replace coal and emit no more than 270 grams of carbon dioxide equivalent per kilowatt-hour. Those facilities would have to obtain construction permits before 2031 and have plans to switch to renewable or low-carbon gases by 2036. Nuclear energy could be classified as sustainable as long as the new plants granted construction permits by 2045 meet a set of criteria to avoid significant harm to the environment and water resources, according to the draft seen by Bloomberg News. Austria’s climate and energy minister, Leonore Gewessler, called on the EU executive to change the proposal or risk legal action. “Greenwashing atomic energy and fossil gas is completely unacceptable,” Gewessler said Monday in an interview broadcast on ORF radio. “Finance markets need a credible label. That’s why this is so important.” Investor Scrutiny The EU taxonomy is closely observed by investors worldwide as a tool to guide private finance in the region’s ambitious transition to climate neutrality. The challenge is to ensure the decision on how to treat nuclear and gas gets political support in the 27-nation bloc while avoiding the risk of greenwashing, or overstating the significance of emissions cuts. The commission said Saturday that gas and nuclear could “facilitate the transition toward a predominantly renewable-based future.” Europe wants to reach carbon neutrality by mid-century under the Green Deal, a sweeping overhaul meaning to accelerate pollution cuts in energy production, transportation and other industries. The decision on whether the green investment rulebook should include gas and nuclear power was delayed in April following criticism that such an addition could undermine the credibility of the system. Giving a temporary green label to certain gas projects could facilitate investments in cleaning up coal-based heating systems in countries such as Poland. That’s an argument often raised by East European politicians. The role of atomic power has pitted Germany, Denmark and Luxembourg against France and the Czech Republic, which both want to rely on reactors in the clean shift. Member states and the Platform on Sustainable Finance have until Jan. 12 to provide feedback. The Commission then will adopt the delegated act later this month. After that, the plan goes before the European Parliament and national governments in the EU Council for scrutiny. Luxembourg Energy Minister Claude Turmes, a member of the Green party, called the EU proposal a “provocation” and warned it harbors the risk of greenwashing. “Does the EU Commission want to seriously motivate citizens to do more climate protection in the new year with nuclear and gas?” he said on Twitter.
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Post by Blitz on Jan 3, 2022 10:30:52 GMT -5
Woke, ESG, stigmas will lead to more offshoring... you can only be illogical for so long before the laws of supple and demand kick in driving cost way too far up to stay warm, drive cars, and power commerce. And now this... Shale drillers face record cost pressures as banks shun the sector By JOE CARROLL on 12/29/2021 www.worldoil.com/news/2021/12/29/shale-drillers-face-record-cost-pressures-as-banks-shun-the-sectorHOUSTON (Bloomberg) --Oil drillers in the biggest U.S. fields are shouldering record costs at the same time that some banks are increasingly reluctant to loan money to the sector, according to the Federal Reserve Bank of Dallas. Equipment, leasing and other input costs for oil explorers and the contractors they hire surged to an all-time high during the current quarter, the Dallas Fed said in a report released on Wednesday. Drillers also are seeing the universe of willing lenders shrink in the Eleventh Federal Reserve District that includes Texas and parts of Louisiana and New Mexico. “The political pressure forcing available capital away from the energy industry is a problem for everyone,” an unidentified survey respondent said. “Banks view lending to the energy industry as having a ‘political risk.’ The capital availability has moved down-market to family offices, etc., and it is drastically reducing the size and availability of commitments regardless of commodity prices.” Cost Pressures Meanwhile, supply-chain snarls are hindering efforts to replace diesel-burning pumps with cleaner, electric-powered gear in the Permian Basin, where components such as transformers are in “extremely short supply,” another respondent said.
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Post by Blitz on Jan 3, 2022 10:33:42 GMT -5
Gazprom misses 2021 gas export targets, straining European markets By OLGA TANAS AND DINA KHRENNIKOVA on 1/3/2022 www.worldoil.com/news/2022/1/3/gazprom-misses-2021-gas-export-targets-straining-european-marketsMOSCOW (Bloomberg) --Russian gas giant Gazprom PJSC missed its own “conservative” target for 2021 exports to Europe, and those capped flows contributed to the continent’s worst energy supply crunch in decades. Gazprom delivered 185.1 billion cubic meters to its main clients abroad, including Turkey, China and Europe, excluding the former Soviet Union nations, Chief Executive Officer Alexey Miller said in a statement on Sunday. That’s 3.2% above 2020 levels, but lower than 2018 and 2019, which were around 200 billion cubic meters. Deliveries to Europe and Turkey were about 177 billion cubic meters last year, according to calculations by Bloomberg News and BCS Global Markets based on Gazprom’s data. That fell short of Gazprom’s forecast for exports to Europe and Turkey of as much as 183 billion cubic meters -- an estimate it stuck to since the spring and maintained at the end of October, even as Europe clamored for more supplies. Capped Flows While Gazprom’s flows to Europe and Turkey were seen below Gazprom’s outlook, they were in line with recent estimates from BCS Global Markets, said Ron Smith, the company’s senior oil and gas analyst in Moscow. “It was clear in recent weeks that high prices had caused a reduction in nominations from its European customer base,” he said. Flows to Europe and Turkey could be even lower -- at some 175.4 billion cubic meters last year, based on assumption that Gazprom’s daily flows to China were more than a third above its contractual volumes in November and December, according to Mitch Jennings, an energy analyst at Sova Capital. Gazprom’s exports have been closely scrutinized as tight supplies in Europe recently sent prices soaring to records. With winter setting in and the region’s stockpiles dangerously low, the Russian company has been sending only as much gas to EU clients as it’s obliged to under long-term contracts, and for months hasn’t offered spot cargoes going into early 2022. It’s unclear why Gazprom has been reluctant to offer spot gas to Europe. While the company has pointed to demand destruction as a result of surging regional prices, European officials say the Russian producer is intentionally withholding in hopes of speeding up approvals for the contentious Nord Stream 2 pipeline. Gazprom doesn’t break export data down by country, making it difficult to estimate 2021 flows to individual markets. However, Miller said that the largest growth in deliveries was to Germany, Turkey and Italy. Flows to China exceeded Gazprom’s contractual obligations throughout 2021, according to Miller. Daily exports outside ex-USSR nations in December, when the peak demand season often starts, averaged 439 million cubic meters -- the lowest level for that month since 2014, according to Bloomberg calculations. Gazprom’s gas output for 2021 reached 514.8 billion cubic meters, the highest since 2008. December daily production averaged 1.523 billion cubic meters, the highest since 2013 for that month. With Russian pipeline exports to most EU countries capped in December, the bulk of the extra gas stayed at home as abnormally low temperatures set in over the final days of the year. As temperatures plunged, deliveries to domestic clients in late December surged to as high as 1.656 billion cubic meters a day, Gazprom said, higher than its average daily production levels for December. To meet the demand, the company said withdrawals from local underground storage reached a five-year high. Russia can afford to draw record amounts from its inventories as Gazprom filled the domestic sites with all-time high gas volumes of 72.6 billion cubic meters by November.
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Post by Blitz on Jan 3, 2022 10:35:11 GMT -5
It still takes fossil fuel power plants to make electric cars go from point A to point B and back. And now this... The ESG perspective ESG and the New Vocabulary Mark Patton, Hydrozonix - Dec 2021 www.worldoil.com/magazine/2021/december-2021/columns/the-esg-perspectiveThere are many who believe that ESG is something new, but the truth is, there is nothing new here. ESG today has evolved from Environmental, Health and Safety (EHS) and Corporate Social Responsibility (CSR) programs, with a renewed emphasis on emission reduction and reduced carbon footprint, in an effort to reduce our impact on climate change. In addition to this, there is also a segment of the ESG movement that is calling for the elimination of fossil fuels. To understand what the oil and gas industry is facing, we need to become familiar with many terms and concepts that are entering into the ESG narrative. Decarbonization. This is what many refer to as getting to net carbon zero or zero carbon emissions. Many major public companies have made claims to achieve net zero by 2030 or 2050. Where this gets complicated is which emissions, and how? Typically, public companies are referring to Scope 1 emissions, those emissions they are directly responsible for. Essentially that would be from Exploration to Refining—not including the power used—which are Scope 2 emissions. Then there is Scope 3, which is the third-party emissions from subcontractors or the use of their products, like emissions from combustion of natural gas or vehicle exhaust. There are estimates that 80% of all emissions are Scope 3. Once we understand what emissions can be, then the next step is how. While the first step would be by reducing emissions as much as possible, you cannot get to carbon zero without offsets. Offsets can be Carbon Capture and Sequestration (CCS) or as simple as tree planting. I will stay away from carbon credits for now, as that is its own topic that we can cover down the road. Many have already made great progress here with decarbonization efforts, as relates to Scope 1 emissions. Total Energies recently announced carbon-neutral LNG as an example. I know a common criticism is why just Scope 1 and that’s because currently, the SEC only requires Scope 1 emission reporting, but that can change. There are groups pushing for Scope 1,2 and 3 reporting and changes on boards to push for this adoption, but in the meantime, any progress is a success. To some, decarbonization isn’t about getting to carbon zero or being carbon-neutral. It means the elimination of fossil fuels. And to some, this goes into population control, because we’re all carbon dioxide emitters. You may think I am exaggerating, but some of the most respected climate scientists and environmentalists have stated, we need a “good virus” to help achieve decarbonization. I do not bring this up as an excuse to undermine decarbonization efforts, but to help everybody understand how some of these terms are being applied. Decarbonization is critical to our industry, and I applaud all the carbon zero goals being established. But I do believe we need Scope 2 and 3 to enter the discussion. A recent Executive Order by President Biden calls for federal vehicles and buildings to be carbon-neutral by 2050. Part of the pushback was that this will be damaging to oil and gas, and the response was “that’s the point.” So, going carbon-neutral or zero isn’t enough for some people—it’s about eliminating fossil fuels. A recent ESG report complained about “greenwashing” among oil and gas companies with all these claims of net carbon zero or carbon-neutral, because they were still using fossil fuels. So, let’s look at greenwashing. Greenwashing is using misinformation or a false impression to convey an environmental benefit—like putting a damaging product in recycled packaging and labeling the product as “green.” I’ve seen, for example, many companies that refer to chemicals as “certified green” by the EPA, when the EPA does not certify chemicals as green or otherwise. The number of companies that have changed nothing about what they do or how they do it, but just added words like sustainable or green, is overwhelming. This is greenwashing. But calling carbon zero or neutral goals “greenwashing,” because they continue the use of fossil fuels, defeats the point of decarbonization, unless you define it, as I mentioned, as the elimination of fossil fuels. We need to start paying attention to how these terms are used. It may be unpopular to put another greenwashing example out there, but eliminating the use of fresh water in shale plays while using brackish water, and calling it sustainable, is greenwashing. Produced water is generated at a rate three times more than is utilized in well completions. The goal should be using 100% produced water for completions. I understand landowner restrictions, logistical issues and long-term brackish water supply contracts may impact the accomplishment of this goal, but calling a transition from fresh to brackish “sustainable” is greenwashing. Fresh and brackish water supplies are critical to the drought-stricken communities we work in. With Blackstone’s announcement that companies with better ESG metrics outperformed others in 2020, there appears to be an ESG premium being applied to publicly traded companies. So, besides being the right thing to do, continuing down the road to decarbonization is critical. More importantly, solar and wind have yet to decarbonize. What? Yes, I said it, solar panels are made from mined coal and silica, and even more coal in a blast furnace. Yet, nobody is calling for that to be decarbonized or the lubricating oils used in wind farms, or the mined lithium sourced from underdeveloped countries that still use child labor. Any mined resource has a tremendous carbon footprint, notwithstanding the environmental damage from open pit mining. But we cannot use this to detract from the goal, we must stay the course and march on to carbon-neutral or carbon zero through decarbonization. That is our path forward.
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Post by bjspokanimal on Jan 3, 2022 13:43:02 GMT -5
Re: this excerpt from above:
Shale drillers face record cost pressures as banks shun the sector
... it's smaller independents that are most reliant on bank financing whereas the large oil majors finance themselves via the capital markets with bonds and equity.
If you look at all forms of oil extraction; onshore, offshore, oil sands, shale, conventional, shallow water, deep water... the form that requires the LEAST reliance on banks and is the most immune from political pressure, is deep water. Very little bank financing is involved when capital is raised to drill large deposits in deep water.
Finally, cost pressures affect things like labor first, drilling consumables second, and on down the line until you get to Drillships, which, as "deep" cyclicals, are generally the last to see large increases in dayrates. The silver lining, however, is that drillship contracts are generally the industry's longest, on average, which tends to pad ultra-deep water drillers' income statements well into downturns in the oil industry. Transocean has a dozen of such long-term contracts that were struck before 2020 that have been critical for keeping the company out of bankruptcy court while other drillers with a lot of jack-ups had fewer such contracts to see them through the glut... a glut that has been the worst 7 years I can remember, including the glut during the early to mid 1980s jfollowing the oil shocks of the late 1970s.
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Post by Blitz on Jan 4, 2022 11:55:58 GMT -5
Yep, lets trust Putin, wind, and solar while shutting down coal and nukes. And now this... UK Households Face Steep Jump In Energy Prices By Charles Kennedy - Jan 04, 2022, 10:30 AM CST oilprice.com/Latest-Energy-News/World-News/UK-Households-Face-Steep-Jump-In-Energy-Prices.htmlHouseholds in the UK are facing much higher electricity prices as a result of the energy crunch, British media report, as the government prepares to adjust a cap on utility bills in April this year. “This year is going to be a very tough year for many people. The energy price crisis needs substantial intervention from the Government,” said Martin Lewis, founder of the free money saving advice website Money Saving Expert, as quoted by iNews. “We are going to see a minimum 50 per cent increase in energy prices in the system and that is unsustainable for many,” Lewis also said. Per another report, in The Guardian, some six million UK households may be unable to afford the higher energy bills expected from April unless the government intervenes, according to a charity. There were four million households living in fuel poverty at the start of 2021, the charity, National Energy Action, said. This number will grow by another two million if the energy bill cap is adjusted in tune with market price trends. “Those on lowest incomes and in less-efficient homes will not just face financial hardship but intolerable living conditions, ill health and, for too many, a shortened life,” the chief executive of National Energy Action, Adam Scorer, said. “This is not just conjecture. It will happen and we’ve had enough time to see it coming and act.” The UK’s shadow secretary for climate change and net-zero, Ed Milliband, said, as quoted by The Guardian, “Working people are being hit by a cost-of-living crisis which has seen energy bills soar, food costs increase and the weekly budget stretched. The government must take urgent action to support those people struggling to pay bills.” The Financial Times reported last month that the country’s energy regulator Ofgem was looking for ways to spread the additional burden, made heavier by the collapse of a number of electricity distributors, more evenly over a longer period of time. By Charles Kennedy for Oilprice.com
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