Trump touts off-grid gas, coal for AI data centers

Market: Coal, Electricity, Natural gas
24/01/25

President Donald Trump said he plans to give developers "very rapid approvals" to build data centers running artificial intelligence (AI) software, as well as off-grid electric generating facilities to power them.

"I'm going to give emergency declarations so they can start building them almost immediately," Trump told the World Economic Forum in Davos, Switzerland, in virtual remarks on Thursday. Allowing for a rapid increase in power generation capacity will enable the US to scale up its AI capabilities and be competitive with China, he said.

Trump said he has been telling developers that he wants them to build electric generating facilities next to their planned data centers. These would bypass connection to the grid, which he said is "old" and unreliable. The developers will be able to fuel their generators with "anything they want," including natural gas, and could use "good, clean coal" as a back-up in case a gas pipeline were to explode, cutting gas supplies to a data center's off-grid gas power plant, he said.

Trump's comments echo those made recently by executives in the oil and gas industry, who are betting that tech giants' desire to quickly build out data centers to develop their own AI software will force them to eschew the long, arduous interconnection process through which new customers connect to the grid, and instead secure their own personal supply of electricity generated by natural gas.

ExxonMobil in December said it was in talks to provide AI data centers with "fully islanded" gas-fired power, which could be installed "independent of utility timelines" and at a pace that other baseload generation fuel sources, like nuclear, could not match.

Alan Armstrong, chief executive of Williams, the largest US gas pipeline company, told Argus that AI data center operators are going to build in states where they can quickly secure off-grid electricity supplies.

By Julian Hast

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12/02/25

India’s LNG demand, imports set to rise by 2030: IEA

Singapore, 12 February (Argus) — India's demand for LNG is set to rise significantly by 78pc to 64bn m³ by 2030 to meet its rising demand for natural gas, the International Energy Agency (IEA) said. This is up from 36.17bn m³ in 2024, according to IEA's India Gas report released at India Energy Week on 12 February. LNG imports would increase to account for 62pc of India's gas consumption, which is expected to hit 103bn m³ by 2030, it added. Imports accounted for 50pc of gas consumption in 2024, out of 72bn m³, oil ministry data show. The rise in demand would be backed by the rising city gas distribution (CGD) sector supported by the rapid expansion of its compressed natural gas (CNG) infrastructure and gas in industrial use, the report said. Targeted strategies and policy interventions may also boost gas consumption beyond the forecasted level to around 120bn m³ by 2030, according to the report. The rise in LNG imports would necessitate additional LNG import capacity beyond 2025, IEA said. The gap between contracted LNG supply and projected LNG requirements is set to widen significantly after 2028, it added. This "may leave India more exposed to the volatility of the spot LNG market unless additional LNG contracts are secured in the coming years," the report said. But production may not keep pace with demand. IEA expects India's domestic gas production, which currently meets 50pc of demand, to grow only moderately to just under 38bn m³ by 2030. India's gas output totalled 36bn m³ in 2024, oil ministry data show. IEA expects overall production growth to be limited by plateauing output from the KG-D6 fields and declining production from legacy assets like ONGC's Mumbai offshore fields, which may offset the increasing onshore production from coal bed methane (CBM) and discovered small fields (DSF) and from the additional supplies from ONGC's deepwater KG-D5 project. But India's compressed biogas (CBG) production potential remains largely untapped, with annual output expected to reach 0.8bn m³ by 2030, IEA said. Sectoral demand Gas demand for power and industrial sectors is expected to each take up 15pc of demand by 2030, equivalent to around 15bn m³ respectively, based on the normalised trajectory of consumption hitting 103bn m³ by 2030, IEA said in its report. Gas consumption from refineries is also expected to increase by more than 4bn m³ by 2030 as more refineries are connected to the grid, it added. Gas usage by refineries totalled 5bn m³ in 2024, oil ministry data show. But growth prospects in the petrochemical and fertilizer sectors remain limited, as there are no new gas-based capacity additions planned, it added. The think tank expects some new demand centres to emerge as a result of higher utilisation of India's stranded gas-fired power plants, faster adoption of LNG in heavy-duty transport, more rapid expansion of India's CGD infrastructure, combined with the replacement of LPG with natural gas in the commercial sector. Challenging targets But IEA expects India's 15pc target of natural gas use in the primary energy mix will be challenging to meet, owing to India's gas development pathway prioritising affordability and energy security. "Inter-fuel competition is particularly strong in India, with natural gas vying against coal, oil and renewables in several gas-consuming sectors," according to the IEA report. Even small changes in global gas prices can significantly impact domestic consumption patterns, the report added. Competitive pricing is needed to enable natural gas adoption given the price sensitivity. By Rituparna Ghosh and Roshni Devi Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Brazil’s January inflation lowest since 1994

11/02/25

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11/02/25

Brazil’s January inflation lowest since 1994

Sao Paulo, 11 February (Argus) — Brazil's monthly inflation stood at 0.16pc in January, the lowest increase for the month since 1994 when the government enacted multiple measures to contain soaring inflation, according to government statistics agency IBGE. The consumer price index (CPI) slowed annually to 4.56pc from 4.83pc in December, heavily influenced by a 14.2pc tumble in power costs in January, compared with a 3.19pc drop in December. Power costs decelerated January's inflation by 0.55 percentage points — the major individual contributor to the annual drop, according to IBGE — thanks to a R1.3bn ($224mn) federal discount in power tariffs that month, CPI's manager Fernando Goncalves said. Food and beverage costs rose by an annual 7.25pc, decelerating from 7.69pc in December. Beef costs increased annually by almost 21.2pc following a 20.8pc gain in the month prior, while soybean oil costs decelerated to 24.55pc over the last 12 months from 29.2pc in December. Motor fuels prices rose by 11.35pc in January. Ethanol was responsible for the group's largest annual increase of 21.59pc, up from 17.58pc in the month prior. Gasoline and diesel prices also registered annual rises of 10.71pc and 2.66pc from 9.71pc and 0.66pc, respectively. Still, diesel prices remained at a 0.97pc monthly increase from December, while ethanol costs contracted by 1.82pc from 1.92pc and gasoline prices increased by 0.61pc from 0.54pc. Fuel prices are likely to keep increasing in February, as states increased the VAT-like ICMS tax on fuels and state-controlled Petrobras increased wholesale diesel prices by 6.3pc , both effective as of 1 February. Transportation costs rose by 1.3pc in January over the year, following a 0.67pc gain in December. Flight tickets were the most responsible for the increase, with a 10.42pc monthly gain from a 22.2pc contraction in December. Brazil's central bank is targeting CPI of 3pc with a margin of 1.5 percentage point above or below. The bank raised its target rate to 13.25pc in January after it failed to maintain Brazil's headline inflation under the ceiling of 4.5pc for 2024. Further increases are expected in the coming months, the bank said. The central bank has recently changed the way it tracks the inflation goal. Instead of tracking inflation on a calendar year basis, it will now monitor the goal on a 12-month basis. In 1994, Brazil enacted its Plano Real, a series of measures to stabilize the economy and detain soaring inflation, which had hit an annual 916pc by the end of that year. One of the measures was to change its currency to the real from the cruzeiro real. By Maria Frazatto Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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BP promises strategy reset after sharp drop in profit

11/02/25

News

11/02/25

BP promises strategy reset after sharp drop in profit

London, 11 February (Argus) — BP today promised to "fundamentally reset" its strategy later this month after reporting a drop in underlying profit last year. The company alluded to what the reset might entail, noting that last year it had "laid the foundations for growth" by committing capital to new oil and gas projects and "refocusing" its investments in low-carbon assets. Details of the strategy shift will be outlined at a capital markets day for investors on 26 February. Key actions in 2024 included taking a final investment decision on the 80,000 b/d Kaskida oil field in the US Gulf of Mexico and raising its exposure to biofuels in Brazil . The company also took steps via a joint venture with Japanese utility Jera that will see it commit less capital to its wind energy investments. BP reported an underlying replacement cost profit — excluding inventory effects and one-off items — of $1.2bn for the fourth quarter of 2024, compared with $3bn a year earlier. For the full year, underlying replacement cost profit fell by 36pc compared with 2023 to $8.9bn, while cash flow from operations dropped to $27.3bn from $32bn. The company benefited from higher oil and gas production last year — up by 2pc on 2023 at 2.36mn b/d of oil equivalent (boe/d). But lower prices, a drop in refining margins and lower contributions from both oil and gas trading weighed on profitability. BP said it expects upstream production to be lower this year and refining margins "broadly flat". It expects a similar level of refinery maintenance in 2025, with the work "heavily weighted towards the first half" and the second quarter in particular. For now, BP is sticking with its share repurchasing programme, announcing a further $1.75bn of share buybacks for the fourth quarter. It has maintained its quarterly dividend at 8¢/share. The company's capital expenditure remained steady at $16.2bn last year. It will provide guidance on this year's investment budget at the strategy day later this month. By Jon Mainwaring Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Natural gas industry hedges US-Canada tariff risk

10/02/25

News

10/02/25

Natural gas industry hedges US-Canada tariff risk

New York, 10 February (Argus) — North American natural gas producers and LNG importers are evaluating their exposure to impending tariffs on Canadian gas flowing into the US, including how they could benefit from uncertainty around the policy. Marketers responsible for managing gas supplies across the US-Canada border and at least one North American LNG importer are holding internal meetings to discuss risks and opportunities related to the potential tariffs, according to sources who asked to remain anonymous because they are not allowed to speak publicly. President Donald Trump on 3 February delayed 10pc tariffs on energy from Canada and Mexico by a month, a day before they were set to be imposed. One of the largest US gas producers is reviewing its supply contracts with Canadian customers to evaluate its exposure to possible retaliatory tariffs by Canada, a person with knowledge of the matter told Argus . The company is particularly concerned with its ability to achieve price certainty given a lack of clarity around which party would pay the tariff and how such a transaction might be audited by regulators, the person said. Some large US gas producers are also looking to exploit the so-called "uncertainty premium" by strategically timing when they hedge their output — ideally, when rhetoric and anxiety over tariffs mounts, so they can lock in higher prices, sources in the banking sector said. Internal meetings to discuss potential tariffs are also being held at US utility Constellation Energy, owner of the Everett LNG import terminal near Boston, Massachusetts, sources said. Tariffs could make Everett LNG more competitive by modestly raising New England pipeline gas prices, thereby making LNG imports more economical when the price for local pipeline capacity is high. Tariffs could also hurt demand for gas from the Saint John LNG import terminal in New Brunswick, Canada, owned by Spanish energy conglomerate Repsol, since most of Saint John's imported gas supplies are shipped via pipeline across the US border into New England. Constellation and Repsol did not respond to requests for comment. New England relies on gas imported from abroad by Everett LNG and Saint John LNG during particularly cold winter days because of insufficient pipeline capacity connecting the region to prolific gas fields in Pennsylvania and the surrounding states. Goldman Sachs estimates Trump's 10pc tariffs on Canadian energy products would reduce Canadian gas exports to the US by about 160mn cf/d (5mn m³/d), while investment bank RBC Capital Markets said the tariffs could cause "mildly higher US gas prices". By Julian Hast Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Energy Transfer to supply gas to planned data center

10/02/25

News

10/02/25

Energy Transfer to supply gas to planned data center

Houston, 10 February (Argus) — US energy infrastructure company Energy Transfer has reached a long-term agreement to supply natural gas to an artificial intelligence data center in central Texas. Under that agreement — Energy Transfer's first direct supply contract with a data center — the company will provide about 450mn cf/d (13mn m³/d) to Denver, Colorado-based CloudBurst Data Center's planned data center campus near San Marcos, Texas, for at least 10 years. That deal is contingent on CloudBurst reaching a final investment decision, which is expected later this year. The data center is scheduled to begin operations in the third quarter of 2026, Energy Transfer said. New energy-intensive data centers that run artificial intelligence software will be a key source of power demand growth in the coming years. Data centers were forecast to drive power demand in the commercial sector 2pc higher this year and lead to another 2pc increase in 2026, according to the US Energy Information Administration. Those additional power needs could lift gas demand by 3 Bcf/d or more by the end of this decade, according to some analyst estimates. Energy Transfer will provide the gas via the Oasis pipeline, a 1.2 Bcf/d line that connects gas supplies from the Permian basin of west Texas to demand centers on the Texas coast. That supply will be used to generate 1.2GW of power exclusively for the data center. Energy Transfer is in talks to supply other data centers along its network of natural gas pipelines. It expects the CloudBurst agreement to be "the first of many," the company said. By Jason Womack Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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