Tag: Shell

The offshore wind energy scandal is even worse than you think

In May, Shell, the UK-based oil and gas giant (2023 revenue: $317 billion), announced that it was cutting staff from its offshore wind business because, according to Bloomberg, the company has decided to focus on markets that “deliver the most value for our investors and customers.” Bloomberg also reported that the staff cuts were made after the departures of top executives in the company’s offshore wind and renewable power businesses.

Last month, Murray Auchincloss, the CEO of oil and gas giant BP, imposed a “hiring freeze and paused new offshore wind projects.” According to Reuters, the new CEO is putting more “emphasis on oil and gas amid investor discontent over its energy transition strategy” and that BP (2023 revenue: $208 billion) was cutting investments in “big budget, low-carbon projects, particularly in offshore wind, that are not expected to generate cash for years.”

From CFACT

By Robert Bryce

Two of Europe’s biggest energy companies are abandoning the SS Offshore Wind.

In May, Shell, the UK-based oil and gas giant (2023 revenue: $317 billion), announced that it was cutting staff from its offshore wind business because, according to Bloomberg, the company has decided to focus on markets that “deliver the most value for our investors and customers.” Bloomberg also reported that the staff cuts were made after the departures of top executives in the company’s offshore wind and renewable power businesses.

Last month, Murray Auchincloss, the CEO of oil and gas giant BP, imposed a “hiring freeze and paused new offshore wind projects.” According to Reuters, the new CEO is putting more “emphasis on oil and gas amid investor discontent over its energy transition strategy” and that BP (2023 revenue: $208 billion) was cutting investments in “big budget, low-carbon projects, particularly in offshore wind, that are not expected to generate cash for years.”

The moves by BP and Shell are only the latest examples of the troubles facing the offshore wind sector, which has been foundering on the shoals of higher interest rates, citizen opposition, and ballooning costs. Over the past year, numerous projects on the Eastern Seaboard, including Skipjack Wind in Maryland, Park City Wind in Connecticut, and South Coast Wind in Massachusetts, have been canceled due to bad economics. In all, according to data compiled by Ed O’Donnell, a nuclear engineer and a principal at New Jersey-based Whitestrand Consulting, about 14,700 megawatts of offshore wind capacity has been canceled. For comparison, about 15,500 megawatts of capacity is now in development, under construction, or operational.

Of course, those figures don’t jibe with the tsunami of hype about offshore wind energy that has appeared in major media outlets. But the hard reality is that America’s offshore wind sector is a subsidy-dependent industry that is dominated by foreign companies who are in bed with some of America’s biggest climate NGOs, including the NRDC (gross receipts: $555 million) and Sierra Club (Gross receipts: $184 million).

Those NGOs and others, including the National Wildlife Federation (gross receipts: $142 million) and Conservation Law Foundation (gross receipts: $17.5 million), are leading the most shameful environmental betrayal in modern American history. Rather than seek to protect marine mammals and stop the industrialization of our oceans, they are eagerly promoting the installation of hundreds of offshore wind platforms smack in the middle of the known habitat of the critically endangered North Atlantic Right Whale.

“What is Big Wind going to say when they kill the last whale? ‘Sorry’?” ACK 4 Whales president Vallorie Oliver on the porch of her home in Nantucket on July 8, 2024. Photo by author.

Last week, I gave public lectures in Nantucket and Newport on the energy transition and offshore wind energy. Those events allowed me to take a deep dive into the cesspool of offshore wind and the entities pushing it. Two small groups, ACK 4 Whales and Green Oceans, sponsored the lectures. (The groups are so new that they haven’t filed Form 990s.) The lectures allowed me to meet dozens of committed and interesting people from all walks of life, income levels, and political beliefs who are fighting the insanity of offshore wind. Among them was Vallorie Oliver, a native of Nantucket who is the president of ACK 4 Whales. Oliver’s father worked as a carpenter and fisherman on the island. She has been fighting the offshore wind projects since 2019.

Oliver reminds me of the dozens of other Americans I’ve been privileged to meet over the last decade as I’ve reported on the backlash against the encroachment of Big Wind and Big Solar. When we talked at her modest home in Nantucket last Monday, I told Oliver that she’s special but not unique. Oliver — and the many others I’ve met who are fighting the energy sprawl that inevitably comes with alt-energy — all share a common value. What is it? It’s the desire to protect their homes, neighborhoods, viewsheds, and property values from the climate change carpetbaggers who are only interested in the profits they can make by paving vast swaths of territory with solar panels and wind turbines.

In an email on Sunday afternoon, Oliver told me what keeps her motivated: “There are no do-overs when the last whale is killed off,” she explained. “There are fewer than 350 North Atlantic Right Whales left. What is Big Wind going to say when they kill the last whale? ‘Sorry’?”

These 11 charts show the offshore wind energy scandal is even worse than you think.

Chart 1: About two-thirds of the offshore projects that are operating, under construction, or proposed are owned, either entirely or in part, by foreign companies.

Chart 2: Those foreign companies are feasting on subsidies. As shown below, the foreign corporations pushing for offshore wind in U.S. waters have, according to data from Good Jobs First, collected more than $9 billion in local, state, and federal subsidies, loans, or loan guarantees, and they are eager for more. How lucrative are the offshore wind subsidies? Consider Vineyard Wind, the 800-megawatt offshore project owned by Avangrid, the Spanish company, and Copenhagen Infrastructure Partners. Construction costs on the project will be about $4 billion. With an investment tax credit of about 40%, those two foreign outfits could collect as much as $1.6 billion in federal tax credits on Vineyard Wind alone.

Chart 3: If there’s a better example of how climate NGOs have sold out to big business — and Big Oil — I can’t name it. Here’s a screenshot from the New York Offshore Wind Alliance website that shows the NGO-corporate-industrial-climate complex at work.

Chart 4: Yup.

Chart 5: Ibid.

Chart 6: I’m old enough to remember when environmental groups cared about whales. Alas, that was a long time ago. On Sunday, the Daily Mail published an article about Apostolos Gerasoulis, a Rutgers professor emeritus of computer science who built a software system to analyze the dozens of whale deaths that have occurred on the Eastern Seaboard over the past few years. Gerasoulis set out to determine if the whale deaths were related to the loud blasts of sonar used by offshore wind survey vessels. His conclusion: “Offshore wind kills whales…The numbers never lie. There is a cause. We have shown that the cause for death of the whales is offshore wind. Period.” (H/t fellow Substack writer David Blackmon.)

Chart 7: Can we trade the Sierra Club for an environmental group that cares about protecting marine mammals? The text below is from the club’s website.

Chart 8: This bit of bureaucratic mumbo jumbo is buried in the environmental impact statement the Bureau of Ocean Energy Management did on Vineyard Wind. Here’s my plain English translation: “These projects won’t make any difference on climate change. But they are good because they allow state-level bureaucrats to say they met their policy goals.”

Chart 9: The big NGOs claim we must build gigawatts of offshore wind because of climate change. But given the enormous size of the U.S. power grid (1,300 gigawatts), whatever reductions in greenhouse gas emissions that might be achieved with offshore wind will be the equivalent of a fart in a hurricane.

Chart 10: Short of throwing currency into a boiler, offshore wind energy is the most expensive way to generate electricity. The recent announcement that the state of New York will pay $155 per megawatt-hour for the juice from the Empire Wind project proves that point.

Chart 11: The states on the East Coast that are building offshore wind have some of the highest electricity prices in the country. Those rates will go higher due to offshore wind. (California is also planning to spend billions on offshore wind, but that’s a topic for another Substack.)

I will close by repeating W. Edwards Deming’s famous line: “In God we trust, all others must bring data.” The data shows offshore wind energy is a lousy deal for whales and ratepayers.

This article originally appeared at Robert Bryce Substack

Shell to pause Dutch biofuels project as market sags

There is no viable commercial market for biofuels. It only survives because of government subsidies and diktat.

From NOT A LOT OF PEOPLE KNOW THAT

By Paul Homewood

There is no viable commercial market for biofuels. It only survives because of government subsidies and diktat.

LONDON (Reuters) -Shell will pause construction work at one of Europe’s largest biofuel plants due to weak market conditions, the latest low-carbon project to suffer a setback as CEO Wael Sawan is striving to boost returns.

It is rare for companies to suspend development of projects underway. Rival BP last week said it is pausing two biofuel projects in Germany and the United States.

Under Sawan, who took office in January 2023, Shell has scrapped and sold renewable and hydrogen projects, retreated from European and Chinese power markets and sold refineries in order to focus on the most profitable operations, primarily in oil and gas.

Shell shares have gained over 11% so far this year.

Shell gave the greenlight for the development of the 820,000-ton-a-year plant in the Netherlands in September 2021 which was originally planned to start production in 2025. The project is now expected to go online towards the end of the decade.

The facility at its chemicals park in Rotterdam was slated to produce sustainable aviation fuel and renewable diesel made from waste.

Shell said in a statement that following the decision to pause construction, “contractor numbers will reduce on site and activity will slow down, helping to control costs and optimise project sequencing.”

UBS analyst Joshua Stone said that the pause was consistent with Shell’s strategy to focus on returns

“The delays further highlight that the advanced biofuels market is not an easy one. The oil majors have dipped their toes and found it challenging,” Stone said.

Shell will also consider an impairment for the project and will provide further details in its quarterly trading update on Friday, it said.

“Temporarily pausing on-site construction now will allow us to assess the most commercial way forward for the project,” Shell’s downstream head Huibert Vigeveno said in a statement.

https://www.msn.com/en-gb/money/other/shell-to-pause-dutch-biofuels-project-as-market-sags/ar-BB1pg5xh

Shell Backtracks On Emission Reduction Targets

Of course, as we know, there was no legally binding agreement at Paris to cut emissions – the actual text even acknowledged that emissions would carry on rising up to 2030.

From NOT A LOT OF PEOPLE KNOW THAT

By Paul Homewood

h/t idau

Oil and gas (O&G) giant Shell has scaled back its 2030 and 2035 emission reduction targets, indicating that it expects the globe to fail the Paris Climate Agreement.

The landmark Paris Climate Agreement, a legally binding international treaty on climate change signed by 196 parties, requires the world to almost halve emissions this decade.

Detailed within Shell’s Energy Transition Strategy 2024 report, the O&G company has lowered its emissions reduction targets from a 20% reduction to 15-20% by 2030. Shell has also “retired” its emissions reduction targets of 45% by 2035.

Shell initially set its emissions reduction targets based on its Net Carbon Impact (NCI) metric, which compares emissions to a 2016 baseline. It is worth noting that the company still maintains its target to cut emissions by 100% by 2050.

Shell is not the first O&G giant to have slashed its reduction targets, with BP also slashing its 2030 emissions reduction target from a 35-40% reduction to 20%-30%, compared with 2019 levels, in 2023. This was due to the firm’s commitment to increasing oil production to bolster energy security.

“With this backtrack, Shell bets on the failure of the Paris Climate Agreement, which requires almost halving emissions this decade,” responds Mark van Baal, founder of activist shareholder group Follow This. “Only Shell’s shareholders can change the board’s mind by voting for our climate resolution at the shareholders’ meeting in May.

“This backtracking removes any doubt about Shell’s intentions: the company wants to stay in fossil fuels as long as possible. The board not only endangers the global economy by exacerbating the climate crisis but also puts the company’s future at risk through policy interventions, disruptive innovation, stranded assets, and accountability for the costs of climate change.”

https://www.current-news.co.uk/shell-bets-on-paris-climate-agreement-failure-with-scaled-back-emission-reduction-targets

Of course, as we know, there was no legally binding agreement at Paris to cut emissions – the actual text even acknowledged that emissions would carry on rising up to 2030.

The silly activist investor, Mark van Baal, can stamp his little feet as much as he wants; but economic reality will always win out in the end.

World needs oil to prevent net zero energy shortages, warns Shell

Warning comes as energy giant waters down key climate pledge to cut its carbon intensity.

Warning comes as energy giant waters down key climate pledge to cut its carbon intensity.

The world is at risk of energy shortages unless more money is invested in drilling for oil and gas, Shell has warned.

The energy giant said global investment in low carbon energy was only half what is needed, meaning the world could be at risk of energy shortages in future unless alternative sources are secured.

The warning came as Shell watered down a key climate pledge to cut its own carbon intensity and pledged a sharp increase in production and sales of liquefied natural gas (LNG). The Telegraph has the story.

Separately, the International Energy Agency (IEA) warned that the world was facing a “slight deficit” of oil this year because of surging US demand and continued production cuts from Opec+ countries.

Earlier this week Rishi Sunak announced plans to build new gas power stations in Britain, warning that the country risked blackouts during the transition to net zero without the investment.

Shell chief Wael Sawan said: “The world must achieve an orderly transition away from fossil fuels to low-carbon energy to achieve net zero emissions.

“Today, fossil fuels meet around 80pc of global energy demand, with an even greater reliance in many developing countries. We support a balanced energy transition, one that maintains secure and affordable energy supplies as the world moves to net zero.”

He said expanding LNG production was essential to the energy transition, with Shell planning to boost production from 28 million tonnes to around 39 million tonnes.

Mr Sawan said: “We expect LNG will play a critical role in the transition. It continues to provide a secure supply of energy in many European countries.

“It also offers flexibility to electricity grids as wind and solar power grow, and opportunities to lower carbon emissions from industries such as cement and steel by replacing coal.”

Shell’s decision to ramp up production of LNG, set out in the company’s new Energy Transition Strategy, marks a step back from the green policies drawn up in its last strategy, which was published before the Ukraine conflict disrupted global energy markets.

The company now plans to reduce the “net carbon intensity” of the energy it sells by 15-20pc by 2030. Its previous target had been to reduce the measure by 20pc.

It has also dropped a plan to reduce the net carbon intensity of its energy by 45pc by 2035 because of “uncertainty in the pace of change in the energy transition”, although it still intends to achieve a 100pc reduction by 2050.

Read the full story here.

Shell Exits US Southcoast Wind Farm Contract, Agrees to Pay Penalty

Shells finance chief said on Thursday the firm had exited a power purchase agreement (PPA) for the planned SouthCoast windfarm off the coast of Massachusetts, agreeing to pay a penalty rather than face rising costs for building the project.

https://www.reuters.com/business/energy/shell-exits-us-southcoast-wind-farm-contract-agrees-pay-penalty-2023-11-02/

LONDON (Reuters) – Shell’s finance chief said on Thursday the firm had exited a power purchase agreement (PPA) for the planned SouthCoast windfarm off the coast of Massachusetts, agreeing to pay a penalty rather than face rising costs for building the project.

Energy firms from BP to Orsted have announced hefty writedowns in recent days for their U.S. windfarm projects in the face of high inflation.

 Read the Original article here. 

Shell Takes Axe To Its ‘Low Carbon’ Division, Refocusing Efforts On Fossil Fuel Extraction

Fossil Fuels Are Back. Shell (SHEL.L) will cut at least 15% of the workforce at its low-carbon solutions division and scale back its hydrogen business as part of CEO Wael Sawan’s drive to boost profits.

From The Climate Change Dispatch

BY RYAN HOGG

Shell has taken another axe to its once lofty decarbonization plans, as the U.K. oil giant’s pivot back to fossil fuels picks up steam.

The group plans to cut at least 15% of staff working in its low-carbon solutions division while scaling back its hydrogen business, Reuters first reported Wednesday.

The move will see 200 jobs go in 2024, with another 130 placed under review by the company, according to a statement from Shell. [emphasis, links added]

The division specializes in solutions to decarbonize the transport and industry sector but is separate from its renewables business.

The focus of the cuts is its hydrogen light mobility unit, which develops technologies for passenger vehicles. The unit’s ambitions have been clipped as customers opt for EVs.

“We are transforming our Low Carbon Solutions (LCS) business to strengthen its delivery on our core low-carbon business areas such as transport and industry,” a representative for Shell told Fortune.

“We remain committed to investing in viable low-carbon business models and focusing on our strengths as we play our part in the decarbonization of the global energy system.”

There are 1,300 people working in the LCS division, Reuters reported, but the company has said that isn’t a full reflection of the people contributing to the unit.

It’s the latest move from CEO Wael Sawan, who joined in January, that pivots Shell back to fossil fuels.

Fossil Fuels Are Back

Across the globe, oil giants have been doubling down on their commitment to fossil fuels in the face of global plans to shift to sustainable energy.

Earlier this week Chevron, the second biggest oil company in the U.S., bought rival Hess Corp. in a $53 billion deal.

The acquisition, its biggest ever, gives the group a significant foothold in the growing oil exploration market of Guyana.

That purchase followed Exxon Mobil’s $59 billion deal to buy the fracking giant Pioneer Natural Resources.

The group expanded its presence in the Permian region straddling Texas and New Mexico with the deal, and left the world in little doubt about its commitment to fossil fuels.

The fresh arms race to secure oil resources comes despite the International Energy Agency (IEA), the world’s leading energy agency, reaffirming its prediction that demand for coal, oil, and natural gas would peak in 2030.

Still, oil groups have been emboldened by rising prices in recent years tied to supply chain logjams following COVID-19 and Russia’s invasion of Ukraine, which has left the commodity in short supply and helped companies like Shell to eye-watering profits.

Read rest at Fortune

Oil Giant Shell Warns Cutting Production “Dangerous and Irresponsible”

Cutting oil and gas production would be “dangerous and irresponsible”, the boss of energy giant Shell has told the BBC.

From The Daily Sceptic

By WILL JONES

Cutting oil and gas production would be “dangerous and irresponsible”, the boss of energy giant Shell has told the BBC.

Wael Sawan insisted that the world still “desperately needs oil and gas” as moves to renewable energy were not happening fast enough to replace it.He warned increased demand from China and a cold winter in Europe could push energy prices and bills higher again.Mr. Sawan angered climate scientists who said Shell’s plan to continue current oil production until 2030 was wrong.Professor Emily Shuckburgh, a climate scientist at the University of Cambridge, said firms such as Shell should focus on accelerating the green transition “rather than trying to suggest the most vulnerable in society are in any way best served by prolonging our use of oil and gas”.Head of the UN António Guterres recently said investment in new oil and gas production was “economic and moral madness”.Mr Sawan told the BBC: “I respectfully disagree.” He added: “What would be dangerous and irresponsible is cutting oil and gas production so that the cost of living, as we saw last year, starts to shoot up again.”

Worth reading in full.

Oil giant Shell warns cutting production ‘dangerous’

Cutting oil and gas production would be “dangerous and irresponsible”, the boss of energy giant Shell has told the BBC.

From NOT A LOT OF PEOPLE KNOW THAT

By Paul Homewood

h/t Robin Guenier

Cutting oil and gas production would be “dangerous and irresponsible”, the boss of energy giant Shell has told the BBC.

Wael Sawan insisted that the world still “desperately needs oil and gas” as moves to renewable energy were not happening fast enough to replace it.

He warned increased demand from China and a cold winter in Europe could push energy prices and bills higher again.

Mr Sawan angered climate scientists who said Shell’s plan to continue current oil production until 2030 was wrong.

Professor Emily Shuckburgh, a climate scientist at the University of Cambridge, said firms such as Shell should focus on accelerating the green transition “rather than trying to suggest the most vulnerable in society are in any way best served by prolonging our use of oil and gas”.

Head of the UN António Guterres recently said investment in new oil and gas production was “economic and moral madness”.

Mr Sawan told the BBC: “I respectfully disagree.” He added: “What would be dangerous and irresponsible is cutting oil and gas production so that the cost of living, as we saw last year, starts to shoot up again.”

The world is in a race to ditch fossil fuels in favour of greener alternatives as globally leaders have pledged to keep the world from warming by more than 1.5C this century.

Last year the European Commission outlined how the EU would speed up its shift to green energy to end its dependency on Russian oil and gas.

Many countries do not have the infrastructure to move to more sustainable forms of energy.

Mr Sawan said an international bidding war for gas last year saw poorer countries like Pakistan and Bangladesh unable to afford liquefied natural gas (LNG) shipments that were instead diverted to Northern Europe.

“They took away LNG from those countries and children had to work and study by candlelight,” he said. “If we’re going to have a transition it needs to be a just transition that doesn’t just work for one part of the world.”

The Committee of Climate Change found household gas appliances were linked to respiratory problems and cardiovascular disease.

Claire Fyson, co-head of climate policy at Climate Analytics, a global science and policy institute, told the BBC: “The idea that it’s a choice between our addiction to fossil fuels or working by candlelight is a gross misrepresentation of reality, when we know renewables are cleaner, cheaper and better for public health.”

The UK has pledged to spend £11.6bn on international climate finance but a memo seen by the BBC said economic shocks like the Covid pandemic had “turned a stretching target into a huge challenge”.

The head of the International Energy Agency, Fatih Birol, has said that “if governments are serious about the climate crisis, there can be no new investments in oil, gas and coal from now”.

https://www.bbc.co.uk/news/business-66108553

Mr Sawan is of course perfectly right. The only way to get energy prices back to down to historical levels is to drill more. And as he says, the real losers in the last year have not been rich westerners, but the third world who have to go without energy because they cannot afford it.

But being the BBC, they have to flood the articles with the usual crackpots and charlatans, like Emily Shuckburgh, who is a mathematician not an energy or economics expert. Or Claire Fyson of Climate Analytics , which is a climate lobby group.

And the ludicrous CCC must be getting desperate to pretend that cheap gas boilers are damaging to your health, when the electric alternatives are unaffordable for most people, who will really will suffer without properly heated homes in winter.

Maybe next time, the BBC should ignore the charlatans and publish more comments from experts who understand the energy market.

Investors Sour on ESG Activism

An investor-driven climate change push at some of the
world’s largest oil companies has stalled out.

From Science Matters

By Ron Clutz

Zero Carbon zealots attacking ExxonMobil, here seen without their shareholder disguises.

WSJ reports with a sad tone what is actually good news that investors are pushing back against ESG political correctness. Their article is: ESG Blowback: Exxon, Chevron Investors Reject Climate Measures  Excerpts in italics with my bolds.

An investor-driven climate change push at some of the
world’s largest oil companies has stalled out.

On Wednesday, Exxon Mobil and Chevron’s shareholders struck down a raft of proposals urging the companies to cut greenhouse-gas emissions derived from fuel consumption, put out new reports on climate benchmarks and disclose certain oil-spill risks, among other initiatives.

The votes were abysmal for climate activists. All but two of the 20 shareholder proposals for the two companies garnered less than 25% of investors’ vote, according to preliminary results, with some performing much worse than similar proposals put forward last year.

Among the most controversial proposals were those that would have had the companies adopt targets for reducing emissions including those from third-party consumption of their products, such as when drivers burn gasoline in their cars, also known as Scope 3 emissions. Those received only 11% and 10% of the vote among Exxon and Chevron investors, respectively, compared with 27% and 33% for similar proposals last year.

In recent weeks, similar climate proposals failed to win over most shareholders
at annual meetings of British oil and gas giants BP and Shell in London.

Investment strategies linked to ESG, short for environmental, social and corporate-governance issues, had gained momentum in recent years, particularly following the onset of the pandemic in 2020. Investors pressed oil companies to show how they were working to reduce their climate footprint, set long-term environmental goals and curtail the flaring of unwanted natural gas.

In 2021, investment firm Engine No. 1 prevailed in a historic proxy battle against Exxon, winning three board seats at the company’s annual meeting with the backing of investment firms, Vanguard, State Street and BlackRock. The firm argued that Exxon needed to form a better strategy to prepare for the world’s anticipated energy transition.

After the defeat, Exxon adopted a so-called net zero commitment — a goal to reduce
or offset greenhouse-gas emissions from its operations to zero by 2050.

But Wednesday’s votes demonstrated how some shareholders have backed off pushing major oil companies to embrace certain climate goals. Investors said many voices pushing ESG measures have been drowned out following Russia’s war in Ukraine, which caused oil and gas prices to skyrocket as global supplies were crimped.

Mark van Baal, founder of environmental activist group Follow This, said shareholders missed an opportunity at the annual votes. Investors know that avoiding climate disaster will require global emissions to fall by almost half by 2030, he said, but many are focused on short-term profits. [Note: van Baal is wrong about disaster–see Even 3°C Warming Can’t Stop World Prosperity. ]

The industry and its allies have said some countries, particularly in Europe, were too quick to move away from fossil fuels toward clean energy sources such as solar and wind. A movement against climate activism has gained political traction in the U.S., particularly among Republican voters. Entrepreneur Vivek Ramaswamy, a candidate for the Republican presidential nomination, has made anti-ESG policies a central plank of his campaign.

The pushback against ESG measures has also hit investment firms such as BlackRock,
which have faced potential boycotts in Texas and other red states.

Republican officials in Florida, Texas, Louisiana and South Carolina pulled more than $4 billion in pension and investment funds from BlackRock starting last year. BlackRock brought in $230 billion from U.S. clients in 2022.

It wasn’t immediately clear how BlackRock, State Street and Vanguard voted at the meetings this week.  State Street and BlackRock declined to comment. Vanguard didn’t immediately respond to a request for comment.

Investments in fossil fuels pushed many oil companies to record profits last year, which lured back some investors who had fled after years of meager returns from the industry. Exxon Chief Executive Darren Woods said Wednesday the company had benefited from investing in fossil fuels when others pulled back.

Even in Europe, energy executives have shown a willingness to alienate clean-energy investors to tailor strategies to the thirst for fossil fuels. BP and Shell’s record full-year 2022 profits and hefty returns to investors have attracted new investors, and won back some who were dubious of their energy-transition strategies, executives said.

Shell and BP executives have said their strategies are consistent with targets to lower global emissions, while also helping supply the oil and gas still demanded in coming years globally. Exxon and Chevron have said they support the emissions targets set by the Paris climate accords and reducing emissions from their operations.

But Woods and other industry executives have argued some climate-related proposals would backfire or leave the economy worse off. Woods said several proposals rejected Wednesday would have required the company to assume the world will cut carbon emissions at a much faster pace than observers have projected.

“Some [would] go so far as to force us to decrease oil and gas development,” he said. “This would do nothing to reduce global demand.”

What is actually beyond debate is not that we are in a climate crisis
but that if we don’t stop destroying our conventional energy economy,
we are going to be in a civilizational crisis.

Column: This is the century of natural gas

Here’s a 2023 headline from an anti-hydrocarbons website: “China, India lead US$534 billion global gas pipeline build out.” The article notes that globally, over 59,000 kilometres of transmission pipeline are under construction and an additional 151,000 kms are proposed (for reference, the earth’s circumference is 40,000 kms). 

From BOE Report

By Terry Etam

The headline above is not designed to make young heads explode, It’s really not. But it might. 

Before getting to why that might be, consider why the headline is a credible statement. The evidence is, in total, overwhelming.

Here’s a 2023 headline from an anti-hydrocarbons website: “China, India lead US$534 billion global gas pipeline build out.” The article notes that globally, over 59,000 kilometres of transmission pipeline are under construction and an additional 151,000 kms are proposed (for reference, the earth’s circumference is 40,000 kms). 

That’s just the growth, and that’s just the bigger transmission lines. Natural gas pipeline distribution systems are made up of large transmission lines and then smaller distribution systems. I have not been able to find a statistic for the combined length of the total global distribution system, perhaps none exists, but consider the U.S.’s pipeline system characteristics: The U.S. has over 300,000 miles of natural gas transmission lines, and about 2.2 million miles of smaller distribution pipelines – the ones that get gas to customers. 

Those numbers, and particularly that ratio, give some examples of the staggering size of the global natural gas infrastructure system. And natural gas is used almost everywhere.

According to a gas infrastructure tracking site, about 130 countries in 2022 either have existing natural gas pipeline systems or have some in development.

Perhaps the most pertinent aspect of the 130-country statistic is that 103 countries as of December 2022 are developing natural gas transmission pipelines, with a total length of 210,000 kms, or more than five times the earth’s circumference.

You may read in the news that net zero 2050 is upon us, and that the fossil fuel industry is in terminal decline, full of stranded assets that will be made obsolete in a few decades because of the sheer will of governments and a very boisterous cheering section.

Yet the world isn’t acting that way at all. The U.S. is undergoing an LNG expansion boom, one that isn’t too scared of stranded assets – according to SP Global, in 2022 there were 23 LNG offtake contracts signed with a term of 20 years or greater. Another nine were signed with terms from 15-20 years. 

These contracts are backstopping what is expected to be a 15 billion cubic feet per day (bcf/d) expansion of the U.S.’ LNG export capability within the next decade. Canada will eventually add a significant amount to that tally, as will Mexico. 

That’s the western world. Here’s what Africa has to say: This is from the Gas Exporting Countries Forum, of which many members are African: “Unfortunately, the issue of African energy access has rarely been reported or prioritised, despite African energy consumption per capita being the lowest globally. In light of the need for a secure, affordable, and sustainable energy source to fuel economic growth and alleviate poverty in Africa, all the available energy options will continue to be relevant…the abundance of natural gas and the proven efficiency of combined cycle gas turbines (CCGTs) in power generation make it a suitable complement to renewables in Africa’s just transition plan.

The continent’s primary energy demand is expected to increase by 82 per cent from 860 Mtoe in 2021 to 1,565 Mtoe by 2050 (Figure 5). Sub-Saharan Africa is expected to account for 84 per cent of this growth amid higher living standards, signaling better access to energy and improvements in the energy poverty problems. Natural gas will be responsible for around 30 per cent of Africa’s total energy demand increase.”

Here is a list of countries that have, in the past few years, either built or are planning to build, LNG import terminals (source: articles like this and this): Myanmar, Thailand, Vietnam, Philippines, Singapore, Malaysia, Argentina, Brazil, Chile, Colombia, Dominican Republic, Jamaica, Mexico, Panama, and Puerto Rico, and Germany.

The following countries have called for support of Africa in pursuing natural gas development (and long-term gas displacement by renewable energy and green hydrogen “if financially and technically feasible”): Kigali, Rwanda, Democratic Republic of Congo, Ghana, Kenya, Malawi, Morocco, Nigeria, Rwanda, Senegal, Uganda, and Zimbabwe. 

The following countries are looking to be LNG exporters by the end of the decade: Mozambique, Tanzania, Nigeria, Mauritania, Congo, and Equatorial Guinea. 

Global LNG demand is expected to nearly double by 2040. 

All in all, those statistics point towards a pretty robust future, no?

The global natural gas business is exploding, with a clear trajectory of growth for at least the next few decades, backed by both contracts and new infrastructure. That infrastructure won’t be abandoned in 20 years, or 30, or 40. Look at coal, which was supposedly the fuel of a distant century, and global consumption of that stuff is at record levels.

Rapid gas development has been happening for at least the past 15 years; Russia’s antics have accelerated it in every part of the world where countries are trying to avoid consumption of Russian hydrocarbons. 

Russia’s war simply accelerated some facets of what was happening regardless. 

Hey, I get it though, the general population does not care about natural gas all that much, not until they pay a whopping utility bill anyway. 

But aside from that, why is booming natural gas development a story worth making the average citizen pay attention?

The fact is they simply have to, because, as mentioned at the outset, the title of this article might be enough to send a good slice of our youth into the darkest of depression or the wildest of rebellion. 

They – the youth of today – have been taught and terrorized and tormented that fossil fuel usage is accelerating us towards Armageddon. They have thunderously been assured that they have no future whatsoever unless hydrocarbon usage ceases immediately. 

The news is full of stories like this: “As climate changes, climate anxiety rises in youth.” The article includes some horrifying stats: In a 2022 study of 10,000 people from around the world, “59 per cent of youth and young adults said they were very or extremely worried about climate change and more than 45 per cent said their feelings about climate change negatively affected their daily life and functioning.”

Kids have always been terrified of the weather, with good cause – when you’re ten years old, the thought of experiencing a flood or fire or tornado is fairly close to as bad as it gets.

Now, the narrative is vastly worthwhile for youth, because they’ve been told, hey kids, you know all those weather events that cause terror in your little hearts? Well, they’re getting worse, they’re going to be inevitable, and they’re YOUR FAULT. YOURS AND YOUR PARENTS AND ALL YOUR STUFF.

Actually, that’s not quite true – the kids are told that the actual culprit are the industries that provide the fuel that causes CO2 emissions. That includes the coal, oil and natural gas industries, lumped together as fossil fuels because it fits so much better on the chest of a villain’s costume than getting all hydrocarbon-technical.

But kids aren’t idiots. (You may well know an exception here or there; I won’t deny that they exist.). They know that the cushy lives most of them lead here in the West have to come from somewhere, that travel has a footprint, that the life they know includes a lot of consumables and throw-away crap and waste. On average they’re not Greta’s, and they’re also not Paris Hiltons. 

But they are, as the youth poll above suggests, gravely concerned about the climate because almost every authority figure in their lives assures them they should be terrified, and that there is little hope of living an entire life to the standard they’ve known thus far. 

They also can read, and all the natural gas stats quoted above are available for viewing online, anytime (some things are really hard to censor). 

They can see how people live, and how people want to live, and how three-quarters of the world’s population would do anything to have the lifestyle we do in the West. They can see the amount of fuel burned every day to make their lives so comfortable. They can see the challenges of building out renewables as a replacement; if old enough, they have seen several decades worth of accelerating renewables spending, trillions of dollars around the world, while at the same time they can readily see that global demand for oil, natural gas, and even coal are all at all time record highs.

So what happens when some genuinely terrified yet curious teenager finds out that the whole world is rushing madly towards a fuel they’ve been told will kill them all? What are they supposed to do then?

Here’s a hopeful path forward. 

Someone will start changing the narrative, pointing out the obvious that natural gas can reduce the emissions profile in many countries that currently burn far dirtier things. Africa currently relies to a sadly great degree on burning dung and wood; it’s not a big stretch to point out that natural gas will be superior.

Relatively simple (and achievable) pathways such as increased LNG fuelling of big trucks will clean up emissions profiles of certain large industries like trucking.29dk2902lhttps://boereport.com/29dk2902l.html

On a larger scale, large natural gas consumers will start capturing and sequestering CO2 at scale, and natural gas combustion with CO2 sequestration by definition meets any sane person’s definition of low emissions energy. 

One of the biggest current knocks against natural gas usage is methane leak emissions. A lot of progress is being made to rectify that issue; new technology is making leak-spotting easier, and at the end of the day, a leak is a leak – it can be fixed.

On the horizon are new technologies, new ideas with vast potential. One such is hydrogen created from natural gas at the point of use, a technology being pioneered by the likes of Innova Hydrogen, Aurora Hydrogen, Ekona Power, and Monolith Corp. This technology could dramatically change emissions profiles, and, crucially, what will be rocket fuel for this industry is the fact it can utilize much of the existing natural gas infrastructure.

It is profoundly absurd to try to envision an energy transition that does not maximize the existing system of millions of kms of pipelines and infrastructure, particularly when advocates of something else are proposing as a solution something that they have no clue as to how to build.

Wouldn’t it be far better to be filling kids’ heads with positivity, and constructiveness, and point out where we can make things work better, rather than scaring them into therapy and wiping out their hope for any sort of future?

Energy conversations should be positive and, most of all, grounded in reality. Life depends on it. Find out more in  “The End of Fossil Fuel Insanity” at Amazon.ca, Indigo.ca, or Amazon.com. Thanks!

Read more insightful analysis from Terry Etam here, or email Terry here.