Venezuela gas deal reached: Trinidad PM

Spanish Market: Natural gas
21/08/18

Trinidad and Tobago will sign an agreement with Venezuela tomorrow for offshore natural gas supply to the Caribbean state, the office of Trinidad's prime minister said today.

An attempt in June 2018 to conclude an agreement for the delivery of the gas failed because of a disagreement between Trinidad's state-owned gas company NGC and Venezuela's state-owned oil company PdV over the price.

The state-to-state agreement – described by today's statement as "historic" - involves European major Shell whose facilities in Trinidad will receive the piped gas from Venezuela's offshore Dragon field, starting with 150mn cf/d in 2020 and eventually reaching 300mn cf/d.

"A high-level Venezuelan delegation" will attend the signing of the agreement, the prime minister's office said, without indicating whether the event will be in Port-of-Spain or Caracas.

There was no immediate comment from PdV or the Venezuelan government.

The gas from the Dragon field will be delivered through a 17km flowline across the maritime border to Shell's existing Hibiscus platform off northwestern Trinidad, from where it would be tied into NGC´s distribution network.

Dragon forms part of Venezuela's 14.7 trillion cf Mariscal Sucre complex that also includes the Patao, Mejillones and Rio Caribe fields.

The gas deal is a key part of Trinidad´s strategy to end nearly five years of supply curtailments to critical gas-based industries. The country's gas production has been falling since 2012, when it averaged 4.1 Bcf/d.

Gas output began to rebound in November 2017 on the back of two projects led by leading producer BP that are delivering a combined 790mn cf/d. National gas production averaged 3.68 Bcf/d in January-June, up by 12.5pc year on year, according to energy ministry data.

But the Venezuelan gas is considered vital to sustaining Trinidad´s gas-based industries, including a four-train liquefaction plant led by BP and Shell, as well as methanol and ammonia plants.

"We are relieved the Dragon gas arrangement is being concluded," the energy ministry told Argus today.

"Although domestic output it rising, the country still has a deficit of about 600mn cf/d, and we will need much more for several planned downstream projects including the reactivation of steel production and expanded methanol production."

Trinidad plans to expand domestic gas production to 4.14 Bcf/d by the end of 2021, finance minister Colm Imbert said in May.

The increase in volume – 22pc above 2017 average output – will come from projects being developed by the country's two major producers – BP and Shell, Imbert said.

"The conclusion of the Dragon agreement will allow Trinidad and Venezuela to move ahead with monetizing the significant gas deposits that straddle their maritime border," the energy ministry said.

Venezuela and Trinidad have been trying for eight years to reach an agreement to tap 10 trillion cf of gas in the cross-border Loran-Manatee field, operated by Chevron.

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03/01/25

US Congress begins with focus on energy, taxes

Some Republicans worry that their razor-thin House majority could soon see their caucus fractured, writes Chris Knight Washington, 3 January (Argus) — The new Republican majority in US Congress has set its sights on passing legislation to grow energy production, unwind climate policies and cut trillions of dollars in taxes, but doing so will require the party to overcome its history of infighting. That disharmony was on display last month, when Republicans in the House of Representatives nearly forced a government shutdown by scuttling a spending deal negotiated by their own leaders. Similar dynamics have been at play for the past two years, as rifts over how to govern made it difficult for House Republican leaders to use a tiny majority to extract policy concessions during negotiations. The first test of party unity in the 119th Congress — sworn in on 3 January — will come as House Republicans vote on whether to re-elect Mike Johnson as speaker with an even smaller majority than last year. Johnson can only afford to lose a handful of votes, assuming all Democrats vote against him, before Republicans risk a repeat of 2023, when far-right members ousted the last speaker but could not agree on a replacement for weeks. A lengthy voting impasse could delay the 6 January certification of the election victory of president-elect Donald Trump, who this week endorsed Johnson. Trump campaigned on passing legislation to allow industry to "drill, baby, drill" by increasing federal oil and gas lease sales, removing regulations and unwinding parts of outgoing president Joe Biden's signature Inflation Reduction Act (IRA). Among the options are rescinding a fee on methane emissions that started at $900/t, and requiring more oil and gas lease sales in the US Gulf of Mexico. On taxes, Trump has proposed extending $4 trillion in cuts due to expire at the end of 2025, in addition to cutting corporate rates to as low as 15pc from 20pc, rescinding clean energy credits, and putting a 20pc tariff on all imports. Other items on Congress' to-do list include passing legislation to fund the government and raising the statutory limit on federal debt. Republicans also say they want to pass a bill to expedite federal permitting, after a bipartisan effort to do so failed to advance in December. Learning to two-step Republican leaders have floated a two-step plan to pass Trump's legislative agenda that would use "budget reconciliation" — a legislative manoeuvre that will prevent a Democratic filibuster in the Senate, but which limits the bill to provisions that will affect the federal budget. Senate majority leader John Thune, a Republican from Texas, has suggested packaging immigration, border security and energy policy into a first budget bill that would pass early this year. Republicans would then have more time to debate a separate — and far more complex — budget bill that would focus on taxes and spending. But some Republicans, mindful of a slim 220-215 House majority that will temporarily shrink because of upcoming vacancies, worry the two-part strategy could fracture the caucus. Republicans have yet to decide the changes to the IRA, which includes hundreds of billions of dollars of tax credits for wind, solar, electric vehicles, battery manufacturing, carbon capture and clean hydrogen. A group of 18 House Republicans last year said they opposed a "full repeal" of the law, which disproportionately benefits districts represented by Republicans. Republicans plan to use their expanded influence to push changes at all levels of government and the work it supports. Incoming Republican chairman of the Senate energy committee John Barrasso has issued a report urging OECD energy watchdog the IEA to revive the inclusion of a "business-as-usual" reference case in its annual World Energy Outlook. Barrasso says the IEA has lost its focus on energy security and instead become a "cheerleader" for the energy transition. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Eni ready for FID on Mozambique’s Coral Norte FLNG

03/01/25

Eni ready for FID on Mozambique’s Coral Norte FLNG

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US oil sector sues Vermont over new climate law

02/01/25

US oil sector sues Vermont over new climate law

Washington, 2 January (Argus) — Oil industry and business groups are challenging a first-of-its-kind law in Vermont that would require fossil fuel producers to pay potentially billions of dollars in fines based on greenhouse gas emissions over the past 30 years. Vermont's law is "unprecedented" and attempts to "pin blame" on a narrow set of out-of-state energy producers for climate-related damages for decades of alleged greenhouse gas emissions, the American Petroleum Institute and the US Chamber of Commerce wrote in a lawsuit filed on 30 December. They argue the law is preempted by the federal Clean Air Act and violates the US Constitution's ban on excessive fines. "It punishes covered energy producers for greenhouse gas emissions related to the lawful production and use of their products and those emissions' purported impacts on climate change," the lawsuit said. Vermont's "Climate Superfund Act" was enacted last year and applies to oil, natural gas and coal producers and refineries found to have emitted at least 1bn metric tonnes (t) of greenhouse gases from 1995-2024. Under the law, Vermont will issue a "cost recovery demand" to those companies based on their emissions that will pay for climate adaptation projects. Vermont will have until 1 January 2027 to finalize specifics of how the program will work, including how to calculate the charge. The lawsuit, filed in a federal district court in Vermont, argues the state had exceeded its authority by trying to impose financial penalties on fossil fuel companies located "well beyond" its borders. The law also imposes an "overly harsh and oppressive retroactive penalty" and is based on an "arbitrary" calculation that focuses on the last 30 years of emissions, the lawsuit argues. Vermont governor Phil Scott (R), who allowed the law to take effect last summer without his signature, has raised concerns about the state's "go-it-alone" approach toward taking on "Big Oil". But New York governor Kathy Hochul (D) last week signed the state's own climate "Superfund" law, which is expected to raise $75bn over the next 25 years from fees on companies that exceed 1bn t of greenhouse gas emissions from 2000-2018. Massachusetts and Maryland are considering similar laws. By Chris Knight Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Q&A: EU biomethane internal market challenged

02/01/25

Q&A: EU biomethane internal market challenged

London, 2 January (Argus) — The European Commission needs to provide clearer guidance on implementing existing rules for the cross-border trade of biomethane to foster a cohesive internal market as some EU member states are diverging from these standards, Vitol's Davide Rubini and Arthur Romano told Argus. Edited excerpts follow. What are the big changes happening in the regulation space of the European biomethane market that people need to watch out for? While no major new EU legislation is anticipated, the focus remains on the consistent implementation of existing rules, as some countries diverge from these standards. Key challenges include ensuring mass-balanced transport of biomethane within the grid, accurately accounting for cross-border emissions and integrating subsidised biomethane into compliance markets. 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With current targets set for 2030, just five years away, there's insufficient support for long-term investments. The EU's legislative cycle is fixed, so expectations for changes are low. Therefore, it's crucial that member states take initiative and extend their targets beyond 2030, potentially up to 2035, even if not mandated by the EU. Some member states might do so, recognising the need for longer-term targets to encourage the necessary capital expenditure for the energy transition. Do you see different interpretations in mass balancing, GHG accounting and subsidies? Interpretations of the rules around ‘mass-balancing', greenhouse gas (GHG) emissions accounting and the usability of subsidised biomethane [for different fuel blending mandates] vary across EU member states, leading to challenges in creating a cohesive internal market. 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The Dutch approach combines GHG accounting arguments with a rejection of EU mass-balance rules, essentially prohibiting biomethane imports unless physically segregated as bio-LNG or bio-CNG. This requirement contradicts EU law, as highlighted by the EU Commission's recent detailed opinion to the Netherlands . France's upcoming blending and green gas obligation, effective in 2026, mandates satisfaction through French production only. Similarly, the Czech Republic recently enacted a law prohibiting the export of some subsidised biomethane . Italy's transport system, while effective nationally, disregards EU mass balance rules. These cases indicate a deeper political disconnect and highlight the need for better alignment and communication within the EU. We know you've been getting a lot of questions around whether subsidised bio-LNG is eligible under FuelEU. What have your findings been? The eligibility of subsidised bio-LNG under FuelEU has been a topic of considerable enquiry. We've sought clarity from the European Commission, as this issue intersects multiple regulatory and legal frameworks. Initially, we interpreted EU law principles, which discourage double support, to mean that FuelEU, being a quota system, would qualify as a support scheme under Article 2's definition, equating quota systems with subsidies. However, a commission representative has publicly stated that FuelEU does not constitute a support scheme and thus is not subject to this interpretation. On this basis, FuelEU would not differentiate between subsidised and unsubsidised bio-LNG. A similar rationale applies to the Emissions Trading System, which, while not a quota obligation, has been deemed to not be a support scheme. Despite these clarifications, the use of subsidised biomethane across Europe remains an area requiring further elucidation from European institutions. It is not without risks, and stakeholders require more definitive guidance to navigate the regulatory landscape effectively. By Emma Tribe and Madeleine Jenkins Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Viewpoint: US Supreme Court tees up more energy cases

31/12/24

Viewpoint: US Supreme Court tees up more energy cases

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