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Venture Global plans CCS project for LNG facilities

  • Market: Emissions, Natural gas
  • 27/05/21

US firm Venture Global plans to build a carbon capture and sequestration (CCS) project for carbon released from its planned 10mn t/yr Calcasieu Pass and 20mn t/yr Plaquemines LNG export plants in Louisiana.

Venture Global will be able to capture and sequester about 500,000 t/yr of carbon from the two facilities once completed, compressing the CO2 at the two sites and then transporting and injecting it at Calcasieu Pass.

The firm also plans to use the CCS technology to capture and sequester 500,000 t/yr of carbon from its planned 20mn t/yr CP2 liquefaction facility, also in Louisiana. The CP2 LNG project has yet to reach a final investment decision (FID), but US energy regulator Ferc accepted Venture Global's pre-filing request in February.

US firm NextDecade has also proposed building a CCS project, at its planned 27mn t/yr Rio Grande LNG facility with storage for up to 5mn t/yr of CO2. French gas and power firm Engie last year ended talks on an LNG supply deal with NextDecade partly because of US emissions concerns.

Calcasieu Pass could begin production this year, with Venture Global issuing a 12-cargo tender in February for loading from October 2021-September 2022. The Plaquemines facility is planned to start commercial operations in 2024, but has yet to reach the FID stage.


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01/05/25

US bill would extend expired biofuel credits

US bill would extend expired biofuel credits

New York, 1 May (Argus) — Legislation soon to be introduced in the US House would extend expired biofuel incentives through 2026, potentially providing a reprieve to refiners that have curbed production this year because of policy uncertainty. The bill, which will be sponsored by US representative Mike Carey (R-Ohio) and some other Republicans on the powerful House Ways and Means Committee, according to a person familiar, could be introduced as soon as today. It would prolong both the long-running $1/USG for blenders of biomass-based diesel and a separate incentive that offers up to $1.01/USG for producers of cellulosic ethanol. The credits expired at the end of last year but under the proposal would be extended through both 2025 and 2026. The incentives would run alongside the Inflation Reduction Act's new "45Z" credit for clean fuel producers, which offers a sliding scale of benefits based on carbon intensity, though the bill would prevent double claiming of credits, according to bill text shared with Argus . The 45Z credit is less generous across the board to road fuels — offering $1/USG only for carbon-neutral fuels and much less for crop-based diesels — and is still in need of final rules after President Joe Biden's administration issued only preliminary guidance around qualifying. The proposal then would effectively offer a more generous alternative through 2026 for biodiesel, renewable diesel, and cellulosic ethanol but not for other fuels that can claim the technology-neutral 45Z incentive. That could upend the economics of renewable fuel production. Vegetable oil-based diesels for instance could claim the blenders credit and earn more than aviation fuels that draw from the same feedstocks. According to Argus Consulting estimates, aviation fuels derived from wastes like distillers corn oil and domestic used cooking should still earn more than $1/USG this year, conversely, since 45Z is more generous to aviation fuels. Extending the biodiesel blenders credit would also allow foreign fuel imports to again claim federal subsidies, a boost for Finnish refiner Neste and the ailing Canadian biofuel startup Braya Renewable Fuels but a controversial provision for US refiners and feedstock suppliers. The 45Z incentive can only be claimed by US producers. The blenders incentive is also popular among fuel marketer groups, which have warned that shifting subsidies to producers could up fuel costs. The proposal adds to a contentious debate taking place across the biofuel value chain about what the future of clean fuel incentives should look like. Some industry groups see a wholesale reversion to preexisting biofuel credits — or even a temporary period where various partly overlapping incentives coexist — as a tough sell to cost-concerned lawmakers and have instead pushed for revamping 45Z. A proposal last month backed by some farm groups would keep the 45Z incentive but ban foreign feedstocks and adjust carbon intensity modeling to benefit crops. Republicans could keep, modify, extend, or repeal the 45Z incentive as part of negotiations around a larger tax bill this year. But the caucus is still negotiating how much to reduce the federal budget deficit and what to do with Inflation Reduction Act incentives that have spurred clean energy projects in conservative districts. Uncertainty about the future of biofuel policy and sharply lower margins to start 2025 have led to a recently pronounced drop in biodiesel and renewable diesel production . President Donald Trump's administration is working on new biofuel blend mandates, which could be proposed in the coming weeks, but has said little about its plans for biofuel tax policy. By Cole Martin Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Ukraine, US sign reconstruction deal


01/05/25
News
01/05/25

Ukraine, US sign reconstruction deal

London, 1 May (Argus) — The government of Ukraine has agreed a "reconstruction" deal with the US that will establish a fund to be filled with proceeds from new mineral extraction licenses. There are few firm details about how much money will be involved, or how any future extraction contracts will be structured. It appears to be the same agreement that came close to being signed in February , which collapsed after an awkward meeting in the White House between Ukrainian president Volodymyr Zelenskiy and his US counterpart Donald Trump. Washington had pitched the deal in advance as providing stakes in Ukraine's mineral rights, as a form of repayment for past US support and a deterrence against future military incursions by Russia. There is no firm indication from either side that this is the case. Ukraine's economy minister Yulia Svyrydenko said today that 50pc of state budget revenues from new licences will flow into the fund, and the fund would then invest in projects in Ukraine itself. US treasury secretary Scott Bessent said the deal "allows the US to invest alongside Ukraine, to unlock Ukraine's growth assets, mobilise American talent, capital and governance standards", suggesting US companies will be involved in the new licenses. He said the fund will be established with the assistance of the US International Development Finance Corporation. Ukraine was eager to show the deal as a success. Svyrydenko said Kyiv will retain ownership of all resources, and "will decide where and what to extract." Neither does the agreement allow for privatisation of state-owned oil and gas company Ukrnafta or power company Energoatom, nor does it mention any debt obligation to the US, she said. The depth of Ukraine's resources are unclear. The country's geological survey shows deposits of 24 of the EU's list of critical minerals, including titanium, zirconium, graphite, and manganese, along with proven reserves of metals such as lithium, beryllium, rare earth elements and nickel. The IEA estimates Ukraine's oil reserves at more than 6.2bn bl and its gas reserves at 5.4 trillion m³, although it said Russia's annexation of Crimea means Kyiv no longer has access to "significant offshore gas resources". By Ben Winkley, John Gawthrop and James Keates Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Brazil's energy transition spending drops in 2024


30/04/25
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30/04/25

Brazil's energy transition spending drops in 2024

Sao Paulo, 30 April (Argus) — Brazil's mines and energy ministry's (MME) energy transition spending shrank by 83pc in 2024 from the prior year, while resources for fossil fuel incentives remained unchanged, according to the institute of socioeconomic studies Inesc. The MME's energy transition budget was R141,413 ($24,980) in 2024, down from R835,237 in the year prior. MME had only two energy transition-oriented projects under its umbrella last year: biofuels industry studies and renewable power incentives, which represented a combined 0.002pc of its total R7bn budget. Still, despite available resources, MME did not approve any projects for renewable power incentives. It also only used 50pc of its budget for biofuel studies, Inesc said. Even as supply from non-conventional power sources advances , most spending in Brazil's grid revamp — including enhancements to better integrate solar and wind generation — comes from charges paid by consumers through power tariffs, Inesc said. Diverging energy spending Brazil's federal government also cut its energy transition budget for 2025 by 17pc from last year and created a new energy transition program that also pushes for increased fossil fuel usage. The country's energy transition budget for 2025 is R3.64bn, down from R4.44bn in 2024. The new program — also under MME's umbrella — has a budget of around R10mn, with more than half of it destined to studies related to the oil and natural gas industry, Inesc said. A second MME program — which invests in studies in the oil, natural gas, products and biofuels sectors — has an approved budget of R53.1mn. The science and technology ministry is the only in Brazil that increased its energy transition spending for 2025, with R3.03bn approved, a near threefold hike from R800mn in 2024. Spending will focus on the domestic industry sector's energy transition, Inesc said. Despite hosting the UN Cop 30 summit in November, Brazil has constantly neglected to address the phase-out of fossil fuels, drawing the ire of climate activists . By Maria Frazatto Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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US LNG developers seek tariff loophole in FTZs


30/04/25
News
30/04/25

US LNG developers seek tariff loophole in FTZs

Construction costs for planned LNG projects could shoot up as a result of new import tariffs on key metals, writes Tray Swanson London, 30 April (Argus) — US president Donald Trump's ultra-protectionist trade policies are pushing developers of LNG export projects to consider using foreign-trade zones (FTZs), in a bid to avoid or defer tariff bills on imported materials. Trump's imposition of wide-ranging import tariffs this year raises the risk of cost inflation for LNG projects, particularly for the six terminals that are already under construction and the seven expected to reach a final investment decision (FID) this year. The 25pc levy on all foreign-sourced steel and aluminium introduced in March is likely to have the greatest impact on LNG projects, given that steel and aluminium can account for about 30pc of a facility's $5bn-25bn construction costs. Steel is required for liquefaction units, pipelines, tanks, structural frameworks and cryogenic hoses, and aluminum is used in heat exchangers. Many LNG developers are seeking to reduce or defer paying the new duties by establishing foreign-trade zones (FTZs) — designated areas in which foreign inputs can avoid import tariffs, at least temporarily, if they fulfil certain criteria. FTZs were introduced in the US nearly a century ago to counteract domestic protectionist trade policy and help US companies remain internationally competitive. US developer Cheniere's 33mn t/yr Sabine Pass plant in Louisiana has already been operating as an FTZ since 2015, according to the US FTZ Board. And Australian independent Woodside Energy's 16.5mn t/yr Louisiana LNG facility in Calcasieu Parish near Lake Charles is in an FTZ, a company spokesman told Argus. The project reached an FID on 29 April and is expected to cost $17.5bn, up from a weeks-old estimate of $16bn. About a quarter of Louisiana LNG's capital expenditure is for equipment and construction materials, roughly half of which will need to be imported so are subject to tariffs, Woodside chief executive Meg O'Neill told investors on 23 April. Other planned projects in Louisiana are looking to establish or join FTZs. US developer Commonwealth LNG's proposed 9.5mn t/yr terminal in Cameron Parish is in the process of joining the same trade zone as Sabine Pass LNG and compatriot firm Venture Global's 12.4mn t/yr Calcasieu Pass facility. Midstream firm Energy Transfer's 16.5mn t/yr Lake Charles LNG facility has been approved by the US FTZ Board, although it has not been activated as an FTZ as no significant construction has taken place yet. The project is awaiting federal permits ahead of likely reaching an FID later this year. On the Texas side of the Sabine river, state-run QatarEnergy and ExxonMobil's 18.1mn t/yr Golden Pass facility, set to come on line in 2026, and US developer Sempra's 13.5mn t/yr Port Arthur LNG terminal, expected on line in 2027, have joined the southeast Texas FTZ. Call of duties FTZs are treated as though they are outside of US Customs territory for purposes of duty payments. This enables companies to defer or reduce tariff payments until the imported product is used commercially. For LNG projects in FTZs, developers do not need to pay tariffs on imported steel or modular liquefaction trains until the unit comes on line and begins producing LNG. Terminals with multiple trains can stagger the payments. Most onshore project developers import materials and components and build their trains on site. Cheniere's Sabine Pass facility used this approach and required 89,000t of structural steel for its six trains. Port Arthur LNG and US firm NextDecade's 17.6mn t/yr Rio Grande LNG plant intend to do the same. But NextDecade is not active in the Port of Brownsville's FTZ, according to the FTZ Board, meaning it is probably the project at greatest immediate risk from the metals tariffs. By late February, NextDecade had secured only 69pc of the materials it needs for the project's first two trains and 33pc for its third train. NextDecade and the Port of Brownsville declined a request for comment. Some projects choose to use smaller, prefabricated trains that are built elsewhere and imported. Venture Global took this approach for its Calcasieu Pass and 27.2mn t/yr Plaquemines plants, using imported trains built by oil field services provider Baker Hughes in Italy, and it intends to use the same technology for its proposed CP2 terminal, on track to reach an FID this year. Under such arrangements, the LNG developer must pay the US' import tariffs. Baker Hughes' customers take ownership of the products it makes in Italy, the company said on 23 April. Calcasieu Pass, which began commercial service on 15 April , is in an FTZ, but Venture Global will need to expand its boundaries to include the adjacent CP2 project. FTZs also have a so-called inverted tariff benefit that allows companies to pay the duty on the finished unit if it is cheaper than the rate for the components. But Trump's executive orders outlining the tariffs essentially prevent the use of the inverted benefit, outlining a special status requirement that import duties be applied to the components, trade group the National Association of Foreign-Trade Zones' director of advocacy and strategic relations, Melissa Irmen, tells Argus. If the tariffs are lifted, firms that had deferred payments would still be required to pay the duties when they reach commercial service unless the order that removes or modifies the tariffs specifically dictates otherwise, Irmen says. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Brazil's Biomas advances forest restoration project


30/04/25
News
30/04/25

Brazil's Biomas advances forest restoration project

Sao Paulo, 30 April (Argus) — Brazilian reforestation company Biomas cleared its first restoration project for a 1,200-hectare (ha) area of the Atlantic rainforest in southern Bahia state. The Mucununga project, which will require initial investments of R55mn ($9.7mn), involved planting 70 native species, with the goal of regenerating the ecosystem in the region. The project is in one of the most biodiverse regions on the planet, where only 26pc of native vegetation remains intact. The project is part of the Biomas' broader goal of restoring 2mn ha of tropical forest over the next 20 years. The project will generate 500,000 carbon credits over the next 20 years, the sale of which will be used to finance other restoration projects. Brazilian pulp company Veracel owns the land for the project, across eight municipalities in the state. Biomas was created in 2022 and its shareholders include Brazilian companies such as miner Vale, pulp and paper company Suzano, bank Itau and meat packer Marfrig. Mucununga is one of many tropical forest restoration projects underway in Brazil and will help contribute to Brazil's Planaveg program, which has the goal of restoring and reforesting 12mn ha by 2030. Brazil is seeking to showcase its potential to provide carbon credits and offsets through the protection of its standing forests and the restoration of previously deforested areas ahead of the UN Cop 30 climate summit, which will be held in northern Para state in November. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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