Sweden, Zambia Article 6 agreement eyes renewables
Sweden and Zambia have signed an initial agreement on climate co-operation under the Paris climate deal, with a focus on investing in renewable power, the countries said.
Zambia's ministry of green economy and environment and the Swedish Energy Agency are now negotiating a bilateral agreement under Article 6.2 of the Paris agreement. This will allow Zambia to generate so-called internationally transferred mitigation outcomes (Itmos), representing emissions reductions, that Sweden may count towards its own emissions cut targets under the UN framework.
Most of the carbon credits that Zambia has generated under the UN's Kyoto protocol-era clean development mechanism and in the voluntary carbon market make use of the REDD+ programme, aimed at reducing deforestation and forest degradation and enhancing carbon stocks.
Given the acute lack of electricity in Zambia because of a drought in the region — the country is 85pc dependent on hydropower for its generation — the Zambian government has proposed that Article 6.2 investments be directed at the country's power system, such as solar and wind power capacity.
And experts from Kenya-based Climate Action Platform–Africa (CAP-A) and the UK's Foreign, Commonwealth and Development Office (FCDO) have suggested that Zambia diversify beyond REDD+ and look at opportunities in sectors such as energy or waste management to maximise its carbon market potential.
"The Zambian government has taken huge steps towards addressing the nation's current energy crisis," Zambia's green economy and environment minister Douty Chibamba said at the signing of the agreement in Lusaka yesterday.
The Swedish Energy Agency aims for projects that provide "large emissions reductions" while having a positive long-term effect on Zambia's energy system, its head of international climate co-operation Sandra Lindstrom said. Projects must also benefit local communities and contribute to sustainable development, Lindstrom said, reflecting the shift away from the Kyoto protocol, under which issues such as indigenous rights or benefit sharing were largely ignored.
CAP-A and the FCDO will launch a programme in September aimed at finalising Zambia's carbon market framework, notably a balanced benefit sharing and distribution system.
The Swedish ambassador stressed at the signing of the agreement that Sweden's investments under Article 6.2 will complement existing support from Sweden's development agency in Zambia and the region.
The initial agreement is Sweden's third with a project host country. Sweden has also signed a bilateral agreement under Article 6.2 with Ghana.
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Indonesia may tighten POME oil export rules: Ministry
Indonesia may tighten POME oil export rules: Ministry
Singapore, 21 August (Argus) — Indonesian exports of palm oil wastes and residues including palm oil mill effluent (Pome) oil may soon be subjected to stricter export regulations, according to a draft document from its trade ministry. The ministry released the draft after a meeting with biofuel feedstock exporters on 20 August. The timeline for a decision on finalising the regulation is still unclear, although some market participants said it could be made by this month. Exports of Pome oil, high acid palm oil residue (Hapor) and empty fruit bunches (EFB) oil under the HS code 2306.60.90 are expected to require export permits, a change from the previous requirement of only export rights. While more details were not disclosed, meeting domestic market obligations (DMO) is usually a prerequisite to get export permits, suppliers said. This means that companies will need to sell a certain amount of cooking oil within Indonesia — or buy export quotas or credits from palm oil refineries around $15-$20/t — before they are able to export these products. This has led to expectations of potentially tightened feedstock exports. Refineries who sell cooking oil volumes to remote areas of Indonesia will also receive higher export quotas. As of January 2023, only crude palm oil (CPO), refined, bleached and deodorised (RBD) palm oil, RBD palm olein and used cooking oil (UCO) were subject to the DMO requirements. The previously-set domestic Highest Retail Price (Harga Eceran Tertinggi or HET) for cooking oil sold to consumers at 14,000 rupiah/l is now Rp15,700/l. This is likely because of higher CPO prices and packaging costs, a Indonesia-based supplier said. But market participants said they were also anticipating this increase previously. The higher HET implies that companies' cost of acquiring export permits in the medium to long term could fall, having sold cooking oil at higher prices domestically, market participants said. DMO for cooking oil Indonesia's Ministry of Trade also issued a regulation on 16 August stating that the DMO scheme for cooking oil will move fully from bulk to packaged palm olein – in 500ml, 1 litre (l), 2l and 5l volumes. This is likely to help maintain stable cooking oil prices and control inflation, as packaged olein is easier to monitor than bulk, a supplier said. The deadline for moving from bulk to packaged volumes is 12 November. Refineries under the DMO must also supply cooking oil volumes domestically of around 250,000 t/month, compared with approximately 300,000 t/month previously. But actual volumes will also depend on factors like how much palm oil wastes and residues exporters want to ship in a particular month too, a supplier said. The draft document did not include updates to long-awaited changes to export duties and levies to POME oil, UCO and other products, market participants said. They were expecting these changes in September or October when the new government is sworn in, although the actual timeline is difficult to determine. Current combined export duties and levies on POME for August is only $10/t, considering a CPO reference price of $820.11/t. UCO is not subject to duties, but have levies of $35/t. By Sarah Giam Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Malaysia’s Petronas achieves first gas at Kasawari
Malaysia’s Petronas achieves first gas at Kasawari
Singapore, 21 August (Argus) — Malaysian state-owned Petronas has started first gas production at the Kasawari field at an initial flow rate of 200mn ft³/d (5.6mn m³/d), the firm announced today. The field is located in Block SK316, approximately 200km off the coast of Sarawak. It contains an estimated 10 trillion ft³ of natural gas resources, with a gas sales rate of 545mn ft/d, according to Petronas. Petronas Carigali, a subsidiary of Petronas, holds a 90pc stake in the Kasawari field and is the operator. Exploration and Production Malaysia Venture (EPMV) holds the remaining 10pc stake. The Kasawari gas field development includes a central processing platform, a flare platform and a wellhead platform, which are all interconnected. Gas from the field is exported to a new riser platform at the E11 production hub through an 81km carbon steel pipeline for further gas delivery to customers in Bintulu, Petronas said. The Kasawari gas field is a crucial feed source for the Petronas LNG complex in Bintulu and in addressing the increasing domestic demand for gas, said Petronas. Carbon capture and storage Petronas is also still looking to develop its carbon capture and storage (CCS) capabilities, including at the Kasawari field, even as it looks to maximise fossil fuel production. The firm on 20 August announced it signed a joint study and development agreement with Abu Dhabi's state-controlled Adnoc and UK decarbonisation firm Storegga, to evaluate the CO2 emission storage capabilities of saline aquifers and construction of CCS facilities in the Penyu basin, offshore peninsular Malaysia. The agreement targets at least 5mn t/yr of CO2 capture and storage capacity by 2030. The scope of the agreement includes a CO2 shipping and logistics study, geophysical and geomechanical modelling, reservoir simulation and containment research while exploring the application of advanced technologies, including artificial intelligence, to enhance storage capacity, Petronas said. Malaysia has a target of net zero emissions by 2050. Petronas is a member of Malaysia's National Energy Transition Roadmap committee, which has identified CCS as one of six energy transition levers to enable the country to be sustainable, low-carbon and resilient. In line with this, Petronas has signed multiple deals with foreign firms to jointly develop CCS projects with Malaysia, including Japanese firms Jera, Mitsui , and Japex . Petronas is also involved in cross-border projects with South Korean firms. Malaysia has a geological abundance of deep saline aquifer reservoirs, which should allow for the development of large-scale, permanent CO2 storage solutions. This latest agreement will significantly accelerate regional deployment of CCS and if successful, will lay the foundations for a regional CCS hub that serves both domestic and international emitters, Petronas added. By Joey Chan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Keppel, ADB to explore Asia-Pacific energy transition
Keppel, ADB to explore Asia-Pacific energy transition
Singapore, 20 August (Argus) — Singapore conglomerate Keppel has signed an agreement with the Asian Development Bank (ADB) and Enterprise Singapore (EnterpriseSG) to explore $800mn worth of decarbonisation projects and blended finance opportunities in Asia-Pacific. Keppel, ADB, and EnterpriseSG will focus on energy transition and environmental sustainability projects,said Keppel on 20 August, and the firms are targeting a total project value in excess of $800mn over 2025-30. The projects will collectively be able to abate at least 1mn t/yr of CO2 equivalent, once they are completed. Keppel will develop and operate these projects, which include the decarbonisation of power generation, renewable energy, electric mobility and green buildings, as well as water treatment, and resource recovery from waste including bio-energy and waste-to-energy in Asia-Pacific. The firms will also collaborate on blended finance and explore the potential use of concessionary financing, which "will further improve bankability, support development outcomes, and help mobilise private investment for the projects," said Keppel. The collaboration will begin with opportunities in southeast Asia, although more details were not provided. Carbon credits to accelerate coal-fired phaseout Keppel last week also signed an agreement with Philippine energy firm Acen and Temasek subsidiary and investment platform GenZero to accelerate the retirement of the 246MW South Luzon coal-fired power plant in Batangas, the Philippines, through the use of carbon credits, and replace it with a clean energy despatch facility. The firms will jointly explore the origination and utilisation of Transition Credits (TCs), which are high-integrity carbon credits generated from the emissions reduced through retiring a coal-fired power plant early and replacing this with clean energy sources. They serve as a complementary financing instrument to reduce the economic gap for the early retirement of these plants. The project is expected to be one of the first converted coal-fired plants in the world to generate TCs, said the firms. The origination and sale of the TCs will help to finance and expedite the retirement of the 246MW South Luzon power plant by 10 years to 2030, as well as support just transition initiatives. The firms will collaborate with the Rockefeller Foundation's coal to clean credit initiative (CCCI) and the Monetary Authority of Singapore's (MAS) Transition Credits Coalition (Traction). The project will "explore the development of end-to-end technological solutions and economic model of the coal-to-clean transition," said Keppel, and will focus on the replacement of the South Luzon plant with a mid-merit integrated renewables and energy storage system consisting of solar plant and battery storage. The project "could also come under Article 6 of the Paris Agreement collaboration between the Philippines and Singapore," said the firms. Singapore and the Philippines last week signed an agreement to collaborate on cross-border trade of carbon credits , whereby the countries will work towards a legally binding implementation agreement on carbon credits, to develop high-integrity carbon markets. By Joey Chan and Prethika Nair Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Borealis, Infinium in CO2-based polymer deal
Borealis, Infinium in CO2-based polymer deal
London, 20 August (Argus) — Austrian petrochemical company Borealis will manufacture polyolefins at its site in Porvoo, Finland using CO2-based "e-naphtha" produced by US by e-fuels firm Infinium. Under the agreement, Infinium will ship "commercial" volumes of e-naphtha to Porvoo from its facility in Corpus Christi, Texas. The first shipment departed the US in May. The e-naphtha is a "sustainable drop-in alternative" to fossil-based naphtha, the firms said. It will be processed in the same way to create polyolefins. E-naphtha can be produced from CO2 from biogenic sources or from carbon capture at industrial facilities such as oil refineries. The e-naphtha feedstock will be tracked through the polymer production process under an ISCC+ certificate, which Infinium's Corpus Christi facility has received. "Atmospheric carbon is a strategic element of the Borealis Circular Cascade approach to foster the transition toward greater circularity in plastics and carbon," said Borealis' vice-president of circular economy solutions Mirjam Mayer. "It allows us to serve the needs of our customers while reducing their carbon footprints." By Will Collins Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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