Commentary: States’ historic opportunity to make homes for renters healthy and safe

Energy News Beat

This commentary was submitted by Sneha Ayyagari, a Clean Energy Leadership Institute Fellow and a Program Manager for Clean Energy Initiative at the Greenlining Institute. See our commentary guidelines for more information.

Winter is coming, and having resilient homes is crucial in climate disasters. For instance, Texans were woefully unprepared for Storm Uri which resulted in 246 deaths. While my family shivered under blankets, temperatures in our house stayed safe since we had insulation and a heat pump that kicked into gear when we had short periods of power. It was devastating hearing of families living in poorly insulated homes exposed to hypothermia. Weatherizing buildings and switching to efficient systems like heat pumps can be lifesaving in extreme weather and generally be more comfortable and can save residents money.

However, for more than a third of residents living in rental housing, accessing incentive programs that allow them to make these upgrades in their homes is very difficult. These barriers are especially high for residents in multifamily affordable housing and mobile homes where many people who are most susceptible to heat-related illnesses live.

States and local governments should implement federal funding with renters in mind. The Department of Energy’s Home Energy Rebates (HER) program provides $8.8B in rebate funding for energy efficiency and electrification projects and an additional $200M for states to develop complementary contractor training programs. States can provide their most vulnerable residents health, economic, and environmental benefits by prioritizing low-income renters in their applications for Home Energy Rebate funding.

To ensure the benefits of this program reach tenants, states should:

Renters should not have to fear that their landlords would use building upgrades as a reason to raise rents or displace them (as has happened in construction projects including apartment renovations in Los Angeles). At a minimum, HER guidance states that the owner must agree to rent the dwelling to a low-income tenant and cannot increase rent as a result of energy improvements for two years. Tenants must also have written notice of their rights in a specific and verifiable mechanism. States should go further to specify clear enforcement and penalties. They should ensure that tenants have access to legal services and support in reporting violations without fear of retaliation. Administrators should prohibit rent increases due to HER or at least extend the window of preventing rent increases to at least 10 years following the precedent of other programs.

In addition to building decarbonization programs, states should adopt policies such as rental efficiency standards, rental registries, eviction protections, and rent-stabilization measures to preserve affordability and increase the quality of rental housing. State and local renter protections such as California’s Transformative Communities Draft Program Guidelines and Berkeley’s Existing Buildings Electrification Strategy include a list of tenant protections and anti-displacement resources.

States have many resources from tenant advocates, environmental justice leaders, and policy groups to build from. This letter led by Just Solutions Collective in collaboration with 60 environmental justice, housing, workforce, and environmental organizations has detailed recommendations on reducing barriers for tenants. Strategic Actions for a Just Economy shared recommendations on developing a tenant protection plan to prevent rent burden, limit evictions, minimize disruptions to tenants, and design enforcement and penalty systems. The Greenlining’s Equitable Building Decarbonization Framework shares how to design a community-led approach to implementation. Just Solutions Collective provides recommendations on ensuring access to low income renters, and Green and Healthy Homes Initiative and Building Decarbonization Coalition  shares lessons learned from past federal building retrofit programs. Other resources include American Council for an Energy-Efficient Economy’s webinars and Energy Innovation’s report on ways to design effective outreach strategies.

Regional and local community based organizations should be compensated to be part of the program administration team and help with outreach, implementation, and evaluation of the Home Energy program. The HER application also requires that states create Community Benefits Plans that describe anticipated economic and direct benefits especially for disadvantaged communities. As states develop their community benefits plans, they should ensure that benefits to low income tenants are prioritized within the scope of the goals.

Stacking and braiding federal funding with other state, local, and utility housing, energy, and building retrofits programs can maximize benefits to renters while streamlining the effort of property owners applying for multiple programs. Philadelphia’s Built to Last and Washington’s Weatherization and Health are good examples of holistic programs.

Families shouldn’t have to choose between affording rent and having a safe and healthy place to live, especially in the face of climate disasters. States have a historic opportunity to drastically improve the lives of tenants. By collaborating with tenants, state energy offices can create strong applications in 2024 that ensure healthy, affordable, and climate-resilient housing for all.

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TotalEnergies Closes Sale of Fort Hills Oil Sands to Suncor

Energy News Beat

TotalEnergies has completed the sale of TotalEnergies EP Canada Ltd., which holds a 31.23 percent working interest in the Fort Hills oil sands mining project, to Suncor Energy Inc.

Aside from the Fort Hills asset, the acquisition also includes associated midstream commitments. The consideration for the transaction is around $1.1 billion (CAD 1.47 billion) and has an effective date of April 1, TotalEnergies and Suncor said in separate news releases Monday. Including adjustments, TotalEnergies said it received a cash payment of roughly $1.3 billion (CAD 1.83 billion) at closing.

Suncor now owns 100 percent of the Fort Hills Project, which it operates. The project is an open-pit truck and shovel mine located in Alberta’s Athabasca region, 56 miles (90 kilometers) north of Fort McMurray. The acquisition adds 61,000 barrels per day (bpd) of net bitumen production capacity and 675 million barrels of proved and probable reserves to Suncor’s existing oil sands portfolio, the company said in an earlier news release announcing the acquisition.

Along with its 100 percent ownership of Firebag and MacKay River in-situ assets, the acquisition provides Suncor with additional long-life, physically-integrated bitumen supply to maximize the utilization of its wholly-owned Base Plant upgraders post the end of the Base Mine life. Suncor’s Base Plant operation includes two mines and extraction operations north of Fort McMurray, in the Regional Municipality of Wood Buffalo.

In October, TotalEnergies completed the sale of its 50 percent participation in the Surmont oil sands project and associated midstream commitments to ConocoPhillips. TotalEnergies received approximately $2.75 billion in cash (CAD 3.7 billion) after closing adjustments, as well as future contingent payments of up to approximately $0.33 billion (CAD 0.44 billion).

ConocoPhillips owns 100 percent of Surmont and is continuing as the asset’s operator. Surmont is located in the Athabasca region of northeastern Alberta, approximately 35 miles south of Fort McMurray. According to the company website, Surmont’s net production reached 69 million barrels of oil equivalent in 2011.

“With these two divestments over the last couple of months, TotalEnergies effectively exits the Canadian oil sands, focusing our allocation of capital to Oil & Gas assets with low breakeven”, TotalEnergies Chief Financial Officer Jean-Pierre Sbraire said. “The company has hence received more than US$4 billion from these sales during the fourth quarter 2023, out of which, as previously announced, US$1.5 billion will be shared with shareholders as buybacks in 2023”.

Gas Power Plant Acquisitions

Meanwhile, TotalEnergies signed an agreement to acquire three gas-fired power plants with a total capacity of 1.5 gigawatts (GW) in Texas for $635 million from TexGen. The three plants are connected to the Electric Reliability Council of Texas (ERCOT), the second largest power market in the USA, according to a separate news release. The transaction remains subject to approval by the relevant authorities.

The acquisition is for the Wolf Hollow I plant, with a 745-megawatt (MW) combined-cycle gas turbine (CCGT) plant on the outskirts of Dallas; the Colorado Bend I plant with a 530-MW CCGT and a 74 MW open-cycle gas turbine (OCGT) south of Houston; and the La Porte site with a 150-MW OCGT, southeast of Houston.

The 1.5 GW additional flexible production capacity will complement the company’s renewable capacity in Texas, which currently has 2 GW gross installed, 2 GW under construction and more than 3 GW under development, TotalEnergies said, adding that the acquisition would strengthen its trading capabilities in the gas and power markets.

“We are delighted with the agreement signed with TexGen to acquire 1.5 GW of CCGT in ERCOT. After the signing of several corporate PPA over the last couple of years and the recent start-up of the utility-scale Myrtle solar plant, this deal is a major milestone for our Integrated Power strategy in the ERCOT market”, TotalEnergies President for Gas, Renewables and Power Stephane Michel said. “These plants will enable us to complement our renewable assets, intermittent by nature, provide our customers with firm power, and take advantage of the volatility of electricity prices”.

Source:

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Glencore Adds Teck’s Mines To Its Global Coal Business

Energy News Beat

Unintended but not unexpected is one way of describing what’s happening to the price of steel-making coal as governments suppress supply in the face of steady demand growth, a perfect recipe for a higher price.

On cue, high-quality hard coking (or metallurgical) coal has risen by 9% over the past three months to around $264 a tonne, and is forecast by Goldman Sachs to rise by another 6% to $280/t before the end of the year.

Multiple factors influence the price of coking coal and its lower-grade cousin, thermal or steaming coal used in the production of electricity, with both blamed by environmentalists and governments for causing carbon pollution and climate change.

But lumping all forms of coal into the same basket and limiting supply growth by withholding mine development approvals, which is what’s been happening in Australia and Canada, is having the predictable effect of driving up the price of coking coal even as thermal coal falls.

The gap, and the promise of long-term demand growth for coking coal, has sparked a burst of corporate activity as some mining companies concerned about the outlook for coal quit and others, confident that the business has a bright future, buy more.

Two recent case studies highlight that point with Whitehaven Coal buying two coking coal mines from BHP in Australia earlier this year, and Glencore leading a syndicate which is in the process of buying the steelmaking coal business of Teck Resources in Canada.

Investor reaction to the deals has been mixed but the Teck/Glencore transaction has produced an interesting stock market reaction with Teck shares slipping 6% lower over the past month and Glencore rising by 8%, the opposite of what normally happens in an asset transaction when the buyer falls, and the seller rises.

The Teck decline is also curious because its exit from coking coal has generated $9 billion which management proposes to invest in other mining interests, especially copper which is one of the key metals in energy transition.

Jonathan Price, president and chief executive of Teck, said in a statement last week that the deal would be a catalyst for the company to re-focus as a Canadian critical metals champion,

“This sale will ensure that Teck is well capitalized and able to realize value from our base metals business and deliver strong returns to our shareholders while maintaining a strong balance sheet,” Price said.

Glencore has a different view, delighted to become the majority owner of Teck’s steelmaking coal business with Japan’s Nippon Steel and Korea’s Posco as minority shareholders.

But what appears to have caught the eye of investors is Glencore’s long-term aim of incorporating the Teck coal mines into “a standalone company” which will also contain the other steelmaking coal assets of Glencore in Australia and Colombia.

The new business, according to a statement by Glencore’s chief executive Gary Nagle, “would be well positioned as a leading, highly cash-generative bulk commodity company, likely attracting strong investor demand given its yield potential”.

Jefferies is another investment bank which shares the optimism for coking coal seen by Goldman Sachs and concern for the outlook for thermal coal.

In a research note published last month Jefferies said: “The outlook for premium low-volatility benchmark metallurgical coal may be the best of any commodity, but it is also seriouslyt underappreciated”.

Source: Forbes-com.cdn.ampproject.org

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Residential solar power saves less energy than expected

Energy News Beat

Imagine a household that consumes 1,000 kilowatt hours of energy per month. Then they install solar panels on their roof that generate 500 kilowatt hours of electricity per month on average. How much should their consumption of electricity drawn from the power grid decline after they install solar? Five hundred kilowatt hours is the expectation, but in reality, it’s less than that for most people. Now, they’re consuming more than 1,000 kilowatt hours per month.

This paradox is called the solar rebound effect: the ratio of the increase in energy consumption to the amount that is generated by the solar panels. In new research from the Georgia Institute of Technology, Matthew Oliver, an associate professor in the School of Economics, presented this argument for how the economics of solar power really work, in “Tipping the Scale: Why Utility-Scale Solar Avoids a Solar Rebound and What It Means for U.S. Solar Policy,” published in The Electricity Journal.

“Getting people to adopt this technology does reduce their reliance on conventional energy sources, but not by as much as you think,” Oliver said. “This is because people end up increasing their electricity consumption after adopting solar panels, as an economic and behavioral response.”

People may believe they are saving money due to subsidies, or might perceive that their electricity consumption isn’t as environmentally damaging as it was before—so they leave the lights on longer and appliances running.

Policymakers must account for solar rebound when determining solar subsidies, Oliver argues. Take the example of a typical household. If their solar rebound is 20%, they’re eliminating 20% of the carbon reduction benefits that they should have received from adding panels.

“You have to build the estimated rebound effect into your benefit-cost ratio with regard to how much electricity consumption you’re actually displacing,” he said. “Because it’s not happening on a one-for-one basis.”

If subsidizing residential solar proves to not be worthwhile, then shifting subsidies to utility-scale solar may be a good alternative. While household solar rebound effects happen because of individual consumer behavior, this is not an issue with utility providers. Utility-scale solar could enable solar to reach its full carbon reduction potential.

“Policymakers could consider reallocating subsidies in a more optimal way to support greater investment in utility-scale solar,” Oliver said. “That’s not to say policymakers wouldn’t continue to subsidize residential solar, but there has been an overwhelming policy focus on the adoption of residential solar.”

Source: Techxplore.com

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The Dramatic Downfall of ESG Investing

Energy News Beat
Investors withdrew $14.2 billion from U.S. sustainable funds over the past year.
Global renewable energy funds experienced record outflows in Q3 2023, with stocks plummeting amid rising costs and market challenges.
Political and regulatory changes, including challenges to the Biden Administration’s ESG rule and SEC’s anti-greenwashing efforts, contribute to the decline in sustainable investing.

Investors are withdrawing money from sustainable funds as the ESG enthusiasm of the past few years is waning amid high interest rates, poor returns, plunging renewable energy stocks, tightened SEC rules, and political backlash.

Over the past year, investors have withdrawn a total of $14.2 billion from U.S. sustainable funds in four consecutive quarters of net withdrawals, data from Morningstar showed.

Green Energy Stocks Battered 

Globally, renewable energy funds saw record outflows of money in the third quarter of 2023 as stocks of wind and solar developers and suppliers crashed amid rising costs, higher interest rates, and supply-chain challenges.

Renewable energy exchange traded funds (ETFs), tracking the performance of clean energy companies, suffered a total of $1.4 billion of outflows in the third quarter, the highest outflows of any previous quarter, according to data from LSEG Lipper cited by Reuters.

The record outflows between July and September only partially offset net inflows of $3.36 billion for the first half of 2023, the data showed.

A perfect storm of soaring costs, supply chain delays, rising interest rates, and low electricity prices at auctions have been hurting renewables-related companies in recent months.

“There’s a dark cloud hanging over green stocks,” Martin Frandsen, a portfolio manager at Principal Asset Management, told the Financial Times last month.

Investors Pull Billions From U.S. Sustainable Funds 

It’s not only the recent flop in renewable energy stocks that’s keeping Wall Street away from sustainable investments. The high interest rates and politicians targeting sustainable investing have also played a role in investor decisions, industry executives and analysts say.

In the third quarter of 2023 alone, investors pulled $2.7 billion from U.S. sustainable funds, continuing a trend of net withdrawals that started in the fourth quarter of 2022, per data from Morningstar Direct.

“Although the motivations behind outflows cannot be perfectly quantified, many factors are in play. These include rising energy prices, high interest rates, concerns about greenwashing, and political backlash,” Alyssa Stankiewicz, an associate director of sustainability research for Morningstar, wrote in an analysis last month.

All U.S. funds also saw net withdrawals in the third quarter of 2023, but the demand drop in sustainable funds was steeper compared to conventional funds, according to Morningstar.

As a result of net withdrawals and poor performance, assets in sustainable funds dropped back below the $298.8 billion mark at the end of the third quarter—falling by 17% from the record-high of $358.2 billion at the end of 2021 but up by 10% from the recent low of $272.2 billion in the third quarter of 2022, Morningstar data showed.

Moreover, for the first time ever, more sustainable funds closed in the third quarter than the number of funds launched. Three new sustainable funds launched, and one existing fund was added to the sustainable funds landscape in Q3, while 13 sustainable funds closed and four funds moved away from ESG mandates, Morningstar said.

Columbia Threadneedle, Hartford, and BlackRock liquidated the largest sustainable funds in terms of assets in the third quarter.

As a result, the total number of sustainable open-end and exchange-traded funds in the United States were 661 at the end of the quarter.

After the third quarter, the list of the top 12 worst-performing ETFs in October was packed with thematic funds in the clean energy space, according to Morningstar Direct research from early November. Electric Vehicle Charging Infrastructure UCITS ETF, First Trust Nasdaq Clean Edge Green Energy UCITS ETF, and the Invesco Solar Energy UCITS ETF were the biggest ETF losers.

New Rules And Political Backlash Discourage Sustainable Fund Investors

In recent months, the Biden Administration’s rule allowing employee retirement plans to consider ESG factors in investment decisions has been challenged by Republican-led states. Fund managers say the rule may have impacted the popularity of sustainable funds.

“We found that the demand for ESG investing, by financial professionals working with retirement-plan participants, was more limited than we anticipated,” Ron Rice, vice president of marketing at Pacific Financial, told The Wall Street Journal.

In addition, the Securities and Exchange Commission (SEC) has been stepping up efforts to combat the greenwashing of labeling funds as sustainable. The SEC updated in September the so-called Names Rule, requiring 80% of a fund’s portfolio to match the asset advertised by its name.

“The updated rule will apply not only to funds whose names suggest a focus in particular investments, industries, or geographies—but also to funds whose names suggest a focus in investments with particular characteristics. This includes names suggesting an investment focus on Environment, Social, and Governance (ESG)-related factors through names such as “sustainable,” “green,” or “socially responsible,” SEC chair Gary Gensler said.

In addition, sustainable investing in the U.S. has been criticized by Republican states, most notably Texas, which says that ESG standards are harming America’s energy industry and threatens millions of jobs. Texas prohibits state contracts and investments with companies that boycott energy companies.

At the end of last year, the Florida Treasury said it would divest $2 billion worth of assets under management by BlackRock because of the ESG investing by the world’s largest asset manager.

“If Larry, or his friends on Wall Street, want to change the world – run for office,” Florida Chief Financial Officer (CFO) Jimmy Patronis said at the time.

“Using our cash, however, to fund BlackRock’s social-engineering project isn’t something Florida ever signed up for.”

Source: Oilprice.com

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A Massive U.S.-Led Pledge Could Be A Global Gamechanger

Energy News Beat

The United States is preparing to announce a pledge to triple the world’s production of nuclear energy by 2050, with more than 10 countries on four continents already signed on to the first major international agreement in modern history to ramp up the use of atomic power.

Signatories to the pledge, set to be unveiled at the United Nations climate summit in Dubai later this month, include many of the largest current users of nuclear energy such as the United Kingdom, France, Romania, Sweden, the United Arab Emirates, Japan and South Korea, a senior Biden administration official familiar with the efforts confirmed HuffPost. A handful of newcomers that have not yet built reactors, including Poland, Ghana and Morocco, are also said to have joined the pledge.

The plan will put pressure on the World Bank to end its long-standing ban on financing nuclear-energy projects, which the American Nuclear Society, a nonprofit of academics and industry professionals who advocate for atomic energy in the public interest, said was crucial to any buildout.

“Tripling the world’s nuclear energy supplies by 2050 is the catalyst required to halt rising temperatures and achieve a sustainable future,” the ANS said in a statement to HuffPost. “A large-scale build-out of new nuclear energy can only happen with the crafting of nuclear-inclusive lending policies by financial institutions like the World Bank.”

More countries are expected to sign on to the pledge before international negotiators convene in Dubai on Nov. 30 for the 28th Conference of the Parties to the U.N. Framework Convention on Climate Change ― known as COP28 ― the annual two-week summit aimed at brokering a global deal to speed up efforts to slash planet-heating emissions and help countries already suffering from the effects of climate change. The 2015 conference is what yielded the watershed Paris Agreement, the first pact to include the world whole in an effort to cut emissions enough to keep the planet’s temperature from climbing above 1.5 degrees Celsius (2.3 degrees Fahrenheit) above pre-industrial averages. The world has already warmed by at least 1.1 degrees Celsius.

“It’s great to see the extension of this commitment to countries like Ghana and Morocco for whom nuclear could be a game-changing technology for energy reliability and emissions reduction,” said Jackie Toth, the deputy director of the progressive pro-nuclear group Good Energy Collective. “Energy demand in Africa is going to scale significantly in the coming decades, so if we’re going to hit our global climate goals, a lot of the new capacity in Africa is going to need to be carbon free.”

Reactors for Units 3 and 4 sit at Georgia Power’s Plant Vogtle nuclear power plant on Jan. 20 in Waynesboro, Georgia, as cooling towers of the older Units 1 and 2 billowing steam. Unit 3, completed in July, is the first new reactor built from scratch in the U.S. in a generation.

When reached by phone Thursday, Toth said she had just left a meeting in Washington of the Biden administration’s Civil Nuclear Trade Advisory Committee at which officials from the Commerce Department, State Department, Energy Department and other federal agencies discussed ways to boost U.S. exports.

Unlike the Obama administration, which canceled key nuclear projects for what the federal government’s own watchdog called political purposes and stacked the Nuclear Regulatory Commission with hard-line opponents of atomic energy, the Biden White House has adopted what Toth described as a “concerted whole-of-government effort” to “support nuclear energy as an important component of a clean-energy transition.”

The nuclear pledge, details of which Bloomberg first reported, represents one of the most ambitious attempts by the U.S. yet to reassert itself as an exporter of atomic energy technology. For decades, Russia has dominated the export market, with its state-owned Rosatom nuclear company offering a one-stop shop for reactors, uranium fuel and financing. Nearly one-third of the roughly 60 reactors under construction worldwide are Russian designs, including the debut nuclear plants underway in Turkey, Egypt and Bangladesh. Moscow’s virtual monopoly over key types of nuclear fuel has made Rosatom immune to the sanctions the U.S. and Europe have piled on Russian gas, oil and mineral exports in the nearly two years since Russia’s invasion of Ukraine began.

Ghana President Nana Akufo-Addo speaks at a state banquet at the Jubilee House in Accra, Ghana, on March 27, during a visit by U.S. Vice President Kamala Harris. Ghana, which has yet to build a reactor, has joined the pledge for a global increase in the use of nuclear energy.

Though China has yet to begin exporting its nuclear technology, Beijing has emerged as the world’s new atomic energy superpower, building its own plants so efficiently that the country completed four of America’s flagship new large-scale reactors before the U.S. could complete even one. China is widely expected to enter the export market in the coming years and reportedly offered to help Saudi Arabia build its first nuclear plant in what was widely seen as a direct challenge to the U.S.

Saudi Arabia is not currently part of the Biden administration’s nuclear pledge.

In a sign of cooperation between the world’s two largest emitters of greenhouse gases, the Biden administration this week announced a separate pact with China to triple the world’s capacity for generating renewable energy, such as wind and solar power, by 2030. The White House unveiled the deal during a diplomatic summit in San Francisco that included President Joe Biden and Chinese President Xi Jinping.

Backing up the same goal in the agreement with China, the Biden administration is forging a separate pact co-led by the European Union and the UAE to triple renewables. More than 70 countries, including much of the African continent, have already backed the renewable energy pledge, and the official said more are signing on by the day.

The U.S. push to address climate change also includes a pact to work on deploying carbon capture technology ― an umbrella term for hardware that filters carbon dioxide out of smokestacks before the heat-trapping gas enters the atmosphere ― with an aim of bringing at least a dozen other countries on board before the start of COP28.

Source: Huffingtonpost.co.uk

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Golar makes progress on FLNG plans

Energy News Beat

Golar LNG said it continues to progress the company’s FLNG growth pipeline, while it is now in detailed commercial discussions to recharter its Hilli FLNG.

The LNG firm led by Tor Olav Trøim said in its third-quarter report that it continues to hold talks on recontracting Hilli upon the end of its current charter in July 2026 with a “number of counterparties and gas field owners”.

Golar said it is now in “detailed commercial discussions for three recontracting opportunities with a 2024 commitment targeted.”

The FLNG, located offshore Cameroon’s Kribi, recently offloaded its 100th cargo of liquefied natural gas since it started operations in 2018.

According to Golar, the unit unloaded its 102nd cargo on November 15, 2023, or more than 7 million tonnes of LNG up to date.

The floating LNG producer has in total four trains installed onboard with a production capacity of 2.4 mtpa.

Earlier this year, US LNG player New Fortress Energy sold its stake in the FLNG to Golar.

Golar acquired a 50 percent interest in trains 1 and 2 of the FLNG.

Besides this FLNG, Golar owns the 2.7 mtpa Gimi which will serve the first phase of BP’s Greater Tortue Ahmeyim FLNG project offshore Mauritania and Senegal under a 20-year contract.

This FLNG has just left Seatrium’s yard in Singapore and is on its way to the GTA hub site.

Golar expects the voyage to take around 60 days, including refueling stops in Mauritius prior to rounding the Cape of Good Hope and in Namibia prior to its arrival.

The firm said that commissioning is expected to take about six months from the commissioning start date with commercial operations (COD) expected thereafter.

This means that the commercial launch of the project could be achieved in the second or third quarter of 2024.

Golar and the GTA partners are “working on initiatives to further optimize the commissioning period in order to achieve COD as early as possible,” it said.

BP’s interim CEO Murray Auchincloss recently said the company is “hopeful” that it will launch the first phase of its Greater Tortue Ahmeyim FLNG project in the first quarter of 2024.

The company pushed back the start of the project due to a delay in the subsea scope.

BP also recently selected Swiss-based offshore contractor Allseas to complete the remaining subsea pipelay scope for the FLNG project, replacing previous contractor Houston-based McDermott.

US firm and project partner Kosmos said in its third-quarter report that the delivery of first gas from the first phase of the project has the potential to slip into the second quarter of 2024.

Golar said it continues to progress the company’s FLNG growth pipeline, including advancing commercial terms with gas resource owners, technical site-specific work, and governmental interaction and approvals across “several West African countries”.

“We are also seeing increasing interest for our market leading FLNG solution in other geographies, including the Americas,” it said.

Most of the projects under discussion are structures where Golar either participates as an equal partner with the gas resource owner and upstream partner in a gas field development, or commercial structures where Golar is exposed to gas offtake prices, it said.

“Golar’s market leading capex per ton and focus on proven gas reserves with attractive lifting costs in geographical areas with shorter shipping distances to end users versus US export projects secures a low break-even LNG production cost with attractive upside to current and forward LNG prices,” the firm said.

In August, Golar signed a heads of terms with Nigeria’s NNPC for joint development of gas fields using floating LNG producers, expanding on their deal signed in April this year.

The relevant fields could fully utilize FLNG Hilli following the end of its current contract in mid-2026, or utilize a MKII FLNG with an annual capacity of 3.5 mtpa, Golar previously said.

Earlier this year, Golar exercised its option to acquire the 148,000-cbm Moss-type carrier, Fuji LNG, which it aims to convert to a floating LNG producer.

The firm said that the cost of a converted Fuji FLNG is expected to be around $2 billion, equivalent to about $570 per ton.

“We continue to progress construction of long lead item orders for a MKII 3.5 mtpa FLNG project and expect to take delivery of the Fuji LNG carrier intended for FLNG conversion during Q1 2024,” Golar said in the third-quarter report.

The company said that engineering and detailed design is “fully developed and ready for project initiation.”

However, the complexity of offshore gas developments drives the timeline for these contemplated FLNG growth projects, it said.

“Until commitments on a gas field and secured debt financing are in place, we do not plan to take a final investment decision or incur significant incremental MKII FLNG capex beyond current committed levels,” the company said.

Golar also said in the report that its remaining LNG carrier, Golar Arctic, has completed a 12-month charter in September and its 5-year drydock in early November.

The 2003-built steam LNG carrier has a capacity of 140,000 cbm.

“Alternatives for this vessel including conversion projects, chartering, or sale are being considered,” Golar said.

The company also finalized the sale of the 1977-built LNG carrier, Gandria, for net consideration of $15.2 million.

Golar reported a net income of $114 million in the third quarter, and adjusted Ebitda of $75 million, inclusive of $39 million of non-cash items.

During the quarter, Golar repurchased 0.2 million shares at an average cost of $21.36 per share, leaving 105.9 million shares issued and outstanding as of September 30, 2023.

Golar’s board of directors approved a total third-quarter dividend of of $0.25 per share to be paid on or around December 11, 2023.

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Chevron says third Gorgon LNG train returns to full production

Energy News Beat

A Chevron spokesperson said that Gorgon Train 3 had returned to full production “over the past few days.”

The spokesperson did not provide any additional information.

Earlier this month, Chevron said that an electrical incident occurred on October 31 in a substation which provides power supply, resulting in the plant’s third train to produce at 80 percent capacity.

Chevron said domestic gas and the remaining two LNG production trains at the Gorgon plant were unaffected.

The Gorgon LNG plant on Barrow Island has three trains and a production capacity of some 15.6 mtpa.

Chevron and its workers at the Gorgon and Wheatstone LNG terminals recently agreed on new labor agreements following lengthy negotiations between Chevron and unions representing the workers.

In September, Chevron also resumed full production at its 8.9 mtpa Wheatstone LNG terminal near Onslow after a fault reduced about 25 percent of the plant’s production.

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India and Russia hold joint naval drills

Energy News Beat

22 Nov, 2023 06:47

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The joint exercise in the Bay of Bengal is aimed at countering global threats and ensuring safe shipping in the Asia-Pacific region, Moscow said

The Russian and Indian navies are holding joint drills in the Bay of Bengal, the Russian Ministry of Defense announced on Tuesday.

The exercise is aimed at “comprehensively developing and bolstering naval cooperation” between the two countries, as well as jointly countering global threats and ensuring safe shipping in the Asia-Pacific region, the statement noted.

During the drills, naval sailors from both countries are conducting joint maneuvering in various naval formations and holding air defense and communications exercises,” the ministry added. During the course of the exercise, which will wrap up on Wednesday, the navies will work out the replenishment of supplies on the move as well as the joint-use of deck-based helicopters.

Two ships from Russia’s Pacific Fleet, the Admiral Tributs, a large anti-submarine guided-missile destroyer, and the Pechenga, a medium sea tanker, are participating in the drills along with two Indian naval ships: the INS Ranvijay, a Rajput-class destroyer, and the INS Kiltan, an anti-submarine warfare corvette. Warplanes and helicopters are also taking part in the exercise.

The Russian warships had arrived at the Indian port of Visakhapatnam on Saturday, the defense ministry said.

The joint drills are being conducted a week after Moscow and New Delhi held high-level talks on bilateral issues, including trade, economic cooperation, connectivity and defense.

Russian Deputy Foreign Minister Andrey Rudenko and Indian Foreign Secretary Vinay Kwatra met on November 13 in New Delhi, where they discussed in detail the engagement in key areas of cooperation and confirmed their commitment to “strengthening coordination in the international arena, including at the UN, as well as at the sites of the Group of Twenty, BRICS and SCO,” the Russian foreign ministry said in a statement.


READ MORE:
Russia and India sign deal on Igla-S missiles – TASS

Meanwhile, India is also holding the 14th edition of its Vajra Prahar drills involving the Indian Army and US Army Special Forces, the country’s defense ministry announced on Tuesday. The drills are held at the Joint Training Node in Umroi, in the northeastern state of Meghalaya. Over the course of three weeks, both sides will jointly plan and rehearse a series of special operations, counterterrorist operations, and airborne operations in mountainous terrain.

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Clean Energy start-ups are struggling as they wait for government aid

Energy News Beat

Oil Price

Some American clean energy and technology startups are struggling to keep afloat while waiting for the U.S. Administration to disburse the pledged loans and funds under the landmark Inflation Reduction Act (IRA).

Source: Oil Price

Several startups have already filed for bankruptcy, others have flagged the ability to continue as a going concern or hired advisors to evaluate financing and strategic alternatives as soaring construction costs and high interest rates challenge their initial plans and timelines for having production sites up and running.

The IRA, passed in August last year, has nearly $370 billion in climate and clean energy provisions, including investment and production credits for solar, wind, energy storage, critical minerals, funding for energy research, and credits for clean energy technology manufacturing such as wind turbines and solar panels.

However, many developers and manufacturers are still waiting for guidance on which specific technologies – including in the hydrogen and low-carbon fuels industries – would qualify for tax credits under the IRA.

Large diversified companies with deep pockets – including fossil fuel producers such as Exxon, Chevron, or Occidental proposing blue hydrogen and direct air capture technologies – can afford to wait to get loans from the Loan Program Office under the IRA.

But small startups created and focused on one clean energy technology only are struggling without government funding.

“If we were part of a larger company, you have a larger whole that absorbs the impact. This is the main show for us,” Ajay Kochhar, chief executive at battery recycling startup Li-Cycle, told The Wall Street Journal in an interview.

Li-Cycle said last month it is pausing construction work on its Rochester Hub project pending the completion of a comprehensive review of the go-forward strategy for the project. The company flagged “escalating construction costs” that now exceed its previously disclosed guidance.

“The Company is actively engaged and continues to work closely with the DOE to satisfy conditions precedent for financial close for the loan for gross proceeds of up to $375 million as it undertakes its comprehensive review of the go-forward strategy of the Rochester Hub,” Li-Cycle said earlier this month.

Li-Cycle has also engaged Moelis & Company as financial advisor to assist in evaluating financing and strategic alternatives for the company.

Another startup, Plug Power, aiming to produce green hydrogen, warned earlier this month that it expects its existing cash and available for sale and equity securities will not be sufficient to fund its operations through the next 12 months, and “These conditions and events raise substantial doubt about the Company’s ability to continue as a going concern.”

NuScale Power, which develops small modular reactor (SMR), terminated in early November the Carbon Free Power Project (CFPP) it was planning with Utah Associated Municipal Power Systems (UAMPS) in Idaho as “it appears unlikely that the project will have enough subscription to continue toward deployment.”

These are just three examples of stalled or canceled projects due to rising costs and the slow process of DOE disbursing funding to startups.

In the summer, U.S. electric truck manufacturer Lordstown Motors filed for bankruptcy, and so did EV technology manufacturer Proterra, which saw Volvo Battery Solutions as the winning bidder to acquire the Proterra Powered business line as part of a Chapter 11 sales process.

Despite supply-chain and tariff challenges unrelated to the IRA and despite the fact that developers are still waiting for clarity on some of the IRA provisions, the benefits of the landmark climate law have started to manifest themselves, clean energy associations say.

Between August 2022 and July 2023, more than $270 billion in capital investment was announced for utility-scale clean energy projects and manufacturing facilities in the United States, the American Clean Power Association (ACP) said in a recent report. This exceeds the combined clean energy investments made over the previous eight years.

However, IRA funding is sometimes a Catch-22 for startups. The Administration won’t issue the loans until the companies have moved ahead with projects and external financing, which many firms struggle to do due to soaring costs and interest rates.

By Tsvetana Paraskova for Oilprice.com

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