EU’s von der Leyen re-elected as Commission president
The European Parliament today approved Ursula von der Leyen's re-election as president of the European Commission.
Nominated by EU states in June, von der Leyen received 401 votes, by secret ballot, from parliament's 720 newly elected members. Von der Leyen called for continuing climate and energy policy in her 2024-29 mandate to achieve greenhouse gas (GHG) cuts of at least 90pc by 2040 from 1990 levels.
"I have not forgotten how [Russian president Vladimir] Putin blackmailed us by cutting us off from Russian fossil fuels. We invested massively in homegrown cheap renewables. And this enabled us to break free from dirty Russian fossil fuels," said von der Leyen, promising to end the "era of dependency on Russian fossil fuels". She did not give an end date for this, nor did she specify if this includes a commitment to end Russian LNG imports.
Von der Leyen went on to detail political guidelines for 2024-29. In the first 100 days of her new mandate, she pledged to propose a "clean industrial deal", albeit without giving concrete figures about how much investment this would channel to infrastructure and industry, particularly for energy-intensive sectors. The clean industrial deal will help bring down energy bills, she said.
Von der Leyen told parliament the commission would propose legislation, under the European Climate Law, establishing a 90pc emission-reduction target for 2040. Her political guidelines also call for scaling up and prioritising clean-tech investment, including in grid infrastructure, storage capacity, transport infrastructure for captured CO2, energy efficiency, power digitalization, and deployment of a hydrogen network.
She will also extend aggregate demand mechanisms beyond gas to include hydrogen and critical raw materials. Her political guidelines note the dangers of dependencies or fraying supply chains, from Putin's "energy blackmail" or China's monopoly on battery and chip raw materials.
Majority report
Passing the necessary legislation to implement her stated policies will now require approval from EU states and from parliament. Unless amplified by Germany's election next year, election victories by far-right parties in France and elsewhere appear not to threaten EU state majorities for specific legislation.
Parliament's political centre-left S&D and liberal Renew groups, as well as von der Leyen's own centre-right EPP, have elaborated key policy requests. These broadly call for the continuation of von der Leyen's Green Deal, the set of legislation and policy measures aimed at 55pc GHG emission reduction by 2030, compared with 1990 levels.
A symbolic issue for von der Leyen to decide, or compromise on, is the internal combustion engine (ICE). Her EPP group wants to stick to technological neutrality and to revise the phase-out, by 2035, of new ICE cars if they cannot run exclusively on carbon-neutral fuels. The EPP wants an EU e-fuel, biofuel, and low-carbon fuel strategy.
Von der Leyen's guidelines reflect the need to gain support from centre-right, centre-left, and greens. For the ICE phase-out, she said the 2035 climate neutrality target for new cars creates investor and manufacturer "predictability" but requires a "technology-neutral approach, in which e-fuels have a role to play." She made no mention of carbon-neutral biofuels.
It will be impossible for von der Leyen to satisfy all demands in her second mandate. That includes policy asks put forward by the EPP, ranging from a "pragmatic" definition of low-carbon hydrogen, market rules for carbon capture and storage, postponing the EU's deforestation regulation, to catering more for farmers, even by scrapping EU wildlife protection for wolves and bears.
EU member states are expected to propose their candidates for commissioners in August, including those responsible for energy, climate, and trade policies. When parliament has held hearings for candidates in late October, von der Leyen's new commission would then be subject to a final vote.
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Urgent action needed for UK to hit net zero goals: CCC
Urgent action needed for UK to hit net zero goals: CCC
London, 17 July (Argus) — The UK increased the rate of reduction in its greenhouse gas (GHG) emissions in 2023, but "urgent action" is needed if the country is to hit its targets in 2030 and beyond, the independent advisory Climate Change Committee (CCC) found today. The report assessed the UK's progress towards its net zero goals against policy set out by the previous Conservative government. The new Labour government, which has been in power since 5 July, has already set the scene for a stronger decarbonisation agenda . But it "will have to act fast to hit the country's commitments", the CCC said. The committee tracked progress on 28 key indicators. Of the 22 that have a benchmark or target, just five are assessed as "on track". The UK's GHG emissions stood at 393mn t/CO2 equivalent (CO2e) in 2023, down by 5.4pc, or 22mn t/CO2e, on the year, provisional data show. This estimate excludes contributions from international aviation and shipping, as these are not included in the UK's 2030 target of a 68pc cut in GHG emissions, from a 1990 baseline. The UK's GHG emissions including the country's share of international aviation and shipping were 423.3mn t/CO2e in 2023, preliminary data show, 49.5pc lower than in 1990. The drop in GHGs has largely been driven by the decrease in coal-fired power generation over that time span. Although progress has been made, the previous administration "signalled a slowing of pace and reversed or delayed key policies", the CCC noted. The reduction in GHG emissions in 2023 is "roughly in line with the annual pace of change needed" to hit the 2030 target, but the average annual rate over the previous seven years is "insufficient", the committee added. The UK's 2030 emissions reduction goal is the first in line with reaching net zero by 2050. The new government has placed strong focus on decarbonising electricity in its first days in office, but this is "not enough on its own", CCC acting chief executive James Richardson said. The average annual rate of GHG reduction outside the electricity supply sector over the previous seven years was 6.3mn t/CO2e, but this will need to more than double to 2030 if the UK is to meet its targets, the CCC found. The committee found that in order to reach targets, "annual offshore wind installations must increase by at least three times, onshore wind installations will need to double and solar installations must increase by five times" by 2030, while oil and gas use should be "rapidly" reduced. The CCC also recommended that around 10pc of UK homes will need to be heated by a heat pump by 2030, in comparison to approximately 1pc today. And the market share of new electric cars needs to increase to "nearly 100pc" by 2030, from a current share of 16.5pc. Labour pledged in its manifesto to restore the 2030 phase-out date for sales of new gasoline or diesel-fuelled cars, while it has set ambitious targets for renewable energy installations and pledged zero-carbon power by 2030. It has also committed to no new oil, gas or coal licences. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
TotalEnergies agrees to sell stake in Nigeria SPDC JV
TotalEnergies agrees to sell stake in Nigeria SPDC JV
London, 17 July (Argus) — TotalEnergies has agreed to sell its 10pc stake in Nigeria's SPDC onshore oil and gas joint venture to Africa-focused independent Chappal Energies for $860mn. Other partners in the SPDC joint venture comprise operator Shell with a 30pc interest, state-owned NNPC with 55pc and Italy's Eni with 5pc. Shell agreed to sell its stake in the joint venture to a consortium of five companies for up to $2.4bn in January. That deal remains subject to a due diligence process by regulators. The joint venture's assets include around 50 producing oil and gas fields across 18 licences. TotalEnergies will transfer its 10pc interest and all its rights and obligations in 15 of the licences to Chappal. These licences mainly produce oil and netted TotalEnergies around 14,000 b/d of oil equivalent last year. The other three licences — OML 23, OML 28 and OML 77 — mainly produce gas and account for 40pc of supply to the Nigeria LNG (NLNG) joint venture, in which TotalEnergies has a 15pc stake. TotalEnergies will also transfer its 10pc stake in these licences to Chappal but it will retain "full economic interest" in them, it said. The divestment "allows us to focus our onshore Nigeria presence solely on the integrated gas value chain and is designed to ensure the continuity of feed gas supply to Nigeria LNG in the future", said TotalEnergies' exploration and production president Nicolas Terraz. Chappal specialises in taking over and operating mature fields. It agreed a deal in November last year to acquire Norwegian firm Equinor's stake in Nigeria's OML 128 block, a transaction that was finally approved earlier this month . The company said last month that it is contemplating issuing a bond to raise up to $450mn to help it finance acquisitions. By Jon Mainwaring Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
China’s CNOOC gets record gas results from Bohai well
China’s CNOOC gets record gas results from Bohai well
Singapore, 17 July (Argus) — Chinese state-controlled oil firm CNOOC has achieved what it described as record gas production results from a test well at its Longkou 7-1 (LK7-1) oil and gas field in the eastern region of China's Bohai Sea. The LK7-1-1 exploration well could produce almost 1mn m³/d of natural gas and about 210m³/d (1,320 b/d) of crude oil, the company said on 15 July. The former set a record for natural gas tested productivity in the Bohai Sea, according to CNOOC. China produced 123.6bn m³ of natural gas in January-June, up by 6pc from a year earlier, according to the National Bureau of Statistics of China (NBS). The country produced 4.15mn b/d of crude in 2023, NBS data showed. The potential output adds to CNOOC's reserves and production in the Bohai Sea, which stood at 1.97mn b/d of oil equivalent (boe/d) and 599,847 boe/d as of the end of 2023, according to CNOOC. The region represents 29pc of the company's total reserves and approximately 32pc of its production. CNOOC, along with other state-controlled firms like PetroChina and Sinopec, dominates China's domestic oil and gas production. CNOOC has also separately started production at an oilfield offshore China. The Wushi 23-5 oilfield development project — located in the Beibu Gulf of the South China Sea — is expected to produce light crude, and achieve peak production of 18,100 boe/d in 2026. "The project will realise full-process recovery and utilisation of the associated gas through integrated natural gas treatment," the company said on 1 July. CNOOC in November 2023 started production at its Bozhong 19-6 condensate gas field in the Bohai bay. The gas field is currently producing an estimated 37,500 boe/d, exceeding an initial expectation of peak production of about 37,000 boe/d, the company said on 11 July. CNOOC in March 2023 discovered the Bozhong 26-6 field with over 100mn t of oil equivalent reserves, also in the Bohai Sea. By Joey Chan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
EU must review 'overly ambitious' H2 targets: Audit
EU must review 'overly ambitious' H2 targets: Audit
Hamburg, 17 July (Argus) — The EU needs a "reality check" on "overly ambitious targets" for renewable hydrogen production and imports, the European Court of Auditors (ECA) has said. The European Commission's RePowerEU targets of producing 10mn t/yr renewable hydrogen by 2030 and importing the same amount were based on "political will" rather than "a robust analysis," the ECA said in a report on EU renewable hydrogen policy. The bloc is "unlikely to meet" the targets "based on available information from member states and industry". Some industry participants have for a long time criticised the EU goals as unrealistic . In a response to the ECA's report, the commission said it "acknowledges the challenges" associated with reaching these "aspirational targets". The commission said it will "assess whether the aspirational targets can be reached," but noted it "cannot commit to any update at this stage". It said the underlying objectives "are still valid" and that "a downward review of the targets" could increase uncertainties for investors. But earlier this year, an assessment in which the commission set out scenarios for the energy sector anticipated much lower domestic renewable hydrogen production of around 3mn t/yr by 2030 . The commission told Argus at the time that the RePowerEU projections for 2030 would be reviewed once member states have submitted updated national and energy climate plans (NECPs). These were due by the end of June, but only a few member states submitted them on time . Responding to the ECA report, the commission said it would accept a recommendation to review its hydrogen strategy more broadly — including incentive mechanisms, the prioritisation of funds and the role of imports compared with domestic production — noting it would take the NECPs into account for this. EU funding could amount to €18.8bn in 2021-27, based on the ECA's estimates. But the commission itself "does not have a full overview of needs or of the public funding available," the ECA said. Funding opportunities are "scattered between several programmes," which makes it "difficult for companies to determine the type of funding best suited for a given project," it said. The ECA acknowledged that progress has been made on key regulatory areas, including a definition of renewable hydrogen. But the body notes that this took a long time, leading to investment decisions for projects being delayed. By Stefan Krumpelmann Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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