September 2023, Vol. 250, No. 9

Global News

Global News September 2023

Norway Approves Connection of LNG Plant to Grid 

Norway, in spite of local opposition, endorsed a proposal to connect Equinor’s Hammerfest LNG plant to the national power grid in a move aimed at reducing CO2 emissions. 

The move includes shuttering a gas power plant, which is the country’s largest producer of carbon dioxide, by 2030. The power supply is to be replaced by primarily renewal energy from the grid. 

“This is an important day for building industry and creating jobs in northern Norway, and for the climate,” Norway's Prime Minister Jonas Gahr Stoere said at a media event in front of the plant in Arctic Norway. 

Equinor said the decision could reduce annual emission of CO2 emissions by about 850,000 tons – 2% of Norway's total yearly total. 

The planned power switch at the Hammerfest plant would be occurring about two years later than previously planned, the government said, due to public opposition. 

Norway’s parliament has previously asked the government to consider an alternative way to cut carbon emissions, such as capturing CO2 at the gas plant and injecting it underground.

Hammerfest LNG can deliver 6.5 Bcm/a of gas, enough to provide power to or about 6.5 million homes. 

Busy Saipem Earns Contracts with Eni, BP Worth $700 Million 

Italy’s Saipem group won two new contracts from Eni’s Eni Congo and BP, worth about $700 million.

The new contacts came after the Italian group announced a $1 billion contract in Libya and two others in Romania and Germany for a total value of about $2 billion (1.8 billion euros). 

The Eni deal is for the conversion of the Scarabeo 5, a semi-submersible drilling unit, off of the coast of the Republic of Congo, into a separation and boosting plant that feeds natural gas to a nearby floating LNG unit. 

It is part of Eni’s project that is expected to reach an LNG production capacity of 3 mtpa, or 159 Bcf/a (4.5 Bcm/a) beginning in 2025, Saipem said in a statement. 

The contract with BP is for offshore activities in the Gulf of Mexico that involve Argos FPU, a facility designed for oil and gas production in deepwater environments, the company said. 

US Awards $1 Billion to Carbon Capture Hubs on Gulf Coast 

The U.S. Department of Energy (DOE) awarded over $1 billion to Texas and Louisiana projects targeting the removal of 2 mtpa of carbon emissions. The move is a key step in ramping up air capture technology. 

The DOE selected Project Cypress in Louisiana, run by Battelle and others, and the South Texas DAC Hub in Kleberg County, Texas, proposed by Occidental Petroleum’s (Oxy) subsidiary 1PointFive and partners Carbon Engineering Ltd. and Worley. 

The agency also launched several new initiatives aimed at bringing the cost of the technology down to less than $100 per net metric ton of CO2-equivalent within this decade. That includes a $35 million government procurement program for carbon removal credits, and funding for 14 feasibility studies and five engineering and design studies for earlier-stage hub projects. 

The DAC, at scale, can help the U.S. meet its goal of neutralizing greenhouse gas emissions by 2050, the DOE said. However, the new technology will need to come down in price before this can be achieved, experts say. 

“If we deploy this at scale, this technology can help us make serious headway toward our net zero emissions goals while we are still focused on deploying, deploying, deploying more clean energy at the same time,” Energy Secretary Jennifer Granholm said at a news conference. 

The grants are the first made by the Energy Department, which got $3.5 billion from Congress to invest in regional DAC hubs from the passage of the bipartisan infrastructure bill. 

Vicki Hollub, CEO of Oxy, told reporters that the project has the potential to remove up to 30 mtpa of CO2 when fully operational and “validates our readiness, technical maturity, and our ability to use Oxy’s expertise in large projects.” 

The Louisiana project will hire workers displaced from the fossil fuel industry to fill some of its projected 2,300 jobs. 

NNPC Destroys Illicit Refineries, Oil Pipeline Connections 

State oil company NNPC tore down dozens of illicit refineries and pipeline connections during ongoing efforts to reduce theft in the oil-rich Niger River delta of Nigeria, it said. 

Reuters reported that through Aug. 11, at least 53 illegal refineries were discovered in the southern oil-producing Rivers, Bayelsa and Imo states. Also found were 35 illegal pipeline connections, which are being repaired. 

Eight incidents of pipeline vandalism causing oil spills were reported. In total, 144 incidents were recorded during the period. 

Organized oil theft from pipelines and wells has hampered the nation’s production and foreign sales in recent years, creating financial challenges for the developing country. 

Hot tapping, the method used to steal oil, often results in accidents that cause spillages or fires. 

NNPC said 11 vessels were flagged by an automatic identification system (AIS) violations and reported to the Navy, which in July intercepted a 211,338-gallon (800,000-liter) vessel carrying stolen crude en route to Cameroon. 

Nigeria lost more than $2 billion to oil theft during the first eight months of last year, an investigation by the country’s Senate found. 

U.S. natural gas pipeline exports to Mexico averaged a record 6.8 billion cubic feet per day (Bcf/d) for June 2023, which is 0.1 Bcf/d greater than the previous record set in June 2021, according to data from Wood Mackenzie. 

US Gas Pipeline Exports to Mexico Set Monthly Record 

Natural gas exports to Mexico surpassed 7 Bcf/d on nine days in June, driven by higher-than-normal temperatures that increased demand for natural gas in Mexico’s electric power sector.

U.S. natural gas pipeline exports to Mexico generally peak in the summer due to increased demand for electricity to power air conditioning. Mexico’s electric power sector consumption has grown by an average of 3% every year since 2018, according to data from Wood Mackenzie. 

U.S. natural gas pipeline exports to Mexico averaged 5.9 Bcf/d in the first half of 2023, similar to the record-high average of 6.0 Bcf/d in the first half of 2021. After declining in 2022, U.S. natural gas pipeline exports to Mexico have returned to the highs of 2021. 

In 2022, Mexico increased its domestic natural gas production by 14%, or 0.3 Bcf/d, reducing natural gas pipeline imports from the United States. In the first half of 2023, Mexico’s domestic production did not increase from 2022, but demand did. To make up the difference, pipeline imports from the United States increased 3%, or 0.2 Bcf/d. 

Developers Studying Carbon Storage Feasibility in Southern Quebec 

Canadian carbon removal developer, Deep Sky, has joined forces with carbon capture and removal solutions provider Svante Technologies Inc. to evaluate the feasibility of sequestering CO2 in Southern Quebec. 

Together, the companies will fund research to study the ability to capture, transport and store CO2. The duo has engaged carbon management consulting firm Sproule to complete the geological subsurface research. 

Deep Sky is working to build large-scale carbon removal and storage infrastructure in Canada. As a project developer, the company is bringing together the most promising carbon dioxide removal technologies to commercialize solutions at scale. This news marks Deep Sky’s first partnership to evaluate the feasibility of permanent CO2 storage in the St. Lawrence River Valley in Quebec to enable rapid and widespread roll-out of this essential climate solution. 

Svante has pioneered novel carbon capture and removal technology, which employs what it calls structured adsorbent beds, known as ‘’filters.’’ The filters are coated with nanoengineered solid adsorbent materials and can be used to capture CO2 from hard-to-abate industrial emissions that come from the production of pulp & paper, cement, hydrogen, and more. The technology can also be used for Direct Air Capture (DAC), in which CO2 that is already in low concentration in the atmosphere, is trapped and removed from ambient air. 

“By combining Deep Sky’s project development expertise with Svante’s ready-to-deploy technology and Sproule’s geology research, we can drive down greenhouse gas emissions and deliver carbon credits to the market at hyper speed,” Fred Lalonde, co-founder of Deep Sky, said. 

Energy Transfer Acquiring Crestwood in $7.1 Billion Pipeline Deal 

Energy Transfer signed a deal to purchase Crestwood Equity Partners for about $7.1 billion including debt. The transaction will add 2 Bcf/d of gas-gathering capacity, 1.4 Bcf/d of gas-processing capacity and 340,000 bpd of crude-gathering capacity. 

The move is Energy Transfer’s latest expansion move, having earlier this year bought Lotus Midstream for $1.45 billion. The Crestwood deal is expected to close in the fourth quarter. 

“These assets are expected to complement Energy Transfer’s downstream fractionation capacity at Mont Belvieu, as well as its hydrocarbon export capabilities from both its Nederland Terminal in Texas and the Marcus Hook Terminal in Philadelphia, Pennsylvania,” Energy Transfer said in a statement. 

The Crestwood deal will give Energy Transfer a larger footprint in several U.S. shale fields and represents a move into the Powder River basin in Wyoming and North Dakota. 

Earlier this year, Energy Transfer rival Oneok agreed to pay $18.8 billion for Magellan Midstream Partners to gain new access to crude oil transportation and storage markets. 

“The industry is in one of the best financial positions it has been in for years from a perspective of cash flow so there is a lot more flexibility to make big acquisitions,” Justin Carlson, co-founder of pipeline data experts East Daley Analytics, told Reuters. “More strenuous” U.S. regulations have also made infrastructure operators more valuable, he said. 

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