New Zealand to keep oil drilling ban, renewables push
New Zealand's ruling Labour party has won an outright victory in national elections, maintaining the country's ban on new offshore oil and gas exploration and setting the scene for a further expansion of renewable energy.
The Labour party will be able to form a majority government in its own right after winning 64 of 120 seats in the 17 October election. It had led a coalition government for the previous three-year term.
Labour introduced the oil exploration ban in 2018 as part of its effort to achieve a carbon-neutral economy by 2050. New Zealand is largely dependent on crude imports to meet its liquid fuels demand. The opposition conservative National party had promised to overturn the ban if it won the election.
The Labour party pledged to introduce more measures to achieve its zero-carbon target over the next three years, such as funding for a new energy development centre to help encourage development of a renewable energy industrial sector. It will also push for the faster adoption of electric vehicles.
The government also plans to bring forward a target to source 100pc of electricity from renewable sources by 2030 rather than 2035. More than 82pc of New Zealand's electricity came from renewable energy last year, mostly hydropower and geothermal. The 100pc target would force the closure of the country's sole coal-fired power plant, Genesis Energy's Huntly operations, which are currently scheduled to operate until 2025.
The government plans to extend the life of the Tiwai Point aluminium smelter by 3-5 years after its owner, UK-Australian resources firm Rio Tinto, said it plans to close the plant by August 2021.
The closure of Tiwai Point would hit New Zealand's gas demand, with local utility Contact Energy warning it could be forced to close the 377MW Taranaki combined-cycle gas-fired power plant as a result. The Tiwai Point smelter accounts for 13pc of New Zealand's power demand.
New Zealand also faces a structural change in its downstream minerals and energy sectors, with Australian steel producer BlueScope warning that it may close its steelmaking operations in the country.
And New Zealand's sole oil products refinery, the 135,000 b/d Marsden Point plant, may be converted into an import terminal.
Labour is considering maintaining its coalition with the New Zealand Green party, which won 10 seats in the new parliament. The Green party's policies include setting a 2030 target date for only zero-emission light vehicles to be imported into New Zealand and for all motor vehicles to be fuelled by renewable energy by 2050.
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Oil firm ReconAfrica agrees to class action settlement
Oil firm ReconAfrica agrees to class action settlement
Cape Town, 18 April (Argus) — Africa-focused, Canada-based upstream firm ReconAfrica has agreed to pay $10.8mn in total to eligible shareholders to settle class action lawsuits lodged in different jurisdictions over allegations that the company made misleading statements. The company will pay $7.05mn to investors who bought its shares on the US over-the-counter (OTC) markets and $3.7mn to shareholders who bought securities in the firm on Canada's TSX Venture Exchange and the Frankfurt Stock Exchange within specified class periods. In Canada, parties reached the proposed settlement after a full-day mediation in October 2023, without any admission of liability by ReconAfrica. A hearing has been scheduled on 20 June for the British Columbia Supreme Court to approve the settlement. The plaintiffs allege that between May 2020 and September 2021, ReconAfrica released misleading statements, including its plans to undertake hydraulic fracturing of "unconventional" resources and "shale" deposits within Namibia. The firm failed to disclose that Namibia has never before allowed fracking. The plaintiffs further claim that ReconAfrica did not disclose data from its test wells that revealed poor prospects for achieving commercially viable oil and gas production. The company also stands accused of undertaking unlicensed drilling and illegal water usage, as well as other environmental and human rights violations. It denies all these allegations. ReconAfrica has a current market capitalisation of C$204.7mn. Earlier this month, it raised C$17.25mn in a public share offering. The firm plans to undertake a multi-well drilling campaign this year, with the first well in Namibia's Damara Fold Belt scheduled for June. The company controls the entire Kavango sedimentary basin, which spans over 300km from the northeast of Namibia to northwest Botswana. Early estimates claimed the basin could hold as much as 31bn bl of oil, of which 22.3bn bl are in Namibia and 8.7bn bl in Botswana. ReconAfrica has a 90pc stake in the PEL 73 licence, which extends 25,000km² across northeast Namibia. The remaining 10pc is held by Namibian state-run company Namcor. The Kavango basin includes part of the ecologically sensitive Okavango Delta, a Unesco World Heritage site. The Okavango watershed consists of the Okavango river and a network of shallow, interlinked aquifers, which is a vital water source for more than a million people. The delta also serves as a habitat and migration path for many endangered animal species. Last year, ReconAfrica received environmental approval to drill 12 more wells in the Kavango. The firm recently completed a technical review of its entire exploration inventory in Namibia and now expects to find a mix of oil and gas. ReconAfrica announced an updated prospective resource estimate for Damara last month, indicating an unrisked 15.4bn bl of undiscovered oil initially-in-place. This compares with a previous estimate that pointed only to prospective natural gas resources amounting to 22.4 trillion ft³. The change "is the result of in-depth analyses of all geochemical data, including cores, cuttings, mud logs, seeps and additional basin modelling studies," ReconAfrica said. The firm has made the updated estimates available to potential joint venture partners and expects to complete this month a farm-out process that it started in December 2023. By Elaine Mills Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Uganda aims for net zero energy sector by 2062
Uganda aims for net zero energy sector by 2062
Kampala, 18 April (Argus) — Uganda has brought forward its target for net zero carbon emissions from its energy sector by three years, to 2062, energy ministry permanent secretary Irene Batebe told an oil and gas conference in Kampala. This new deadline is still lagging some way behind a 2050 "net zero operations" target pledged by 40 oil and gas firms , including African state-owned ones such as Libya's NOC and Sudan's Nilepet, at the UN Cop 28 climate summit. Signatories to the Cop 28 charter also pledged "near-zero upstream methane emissions" by 2030. Uganda's CO2 emissions from fuel combustion were 5.7mn t in 2021, according to most recent IEA data, but this will probably increase with the development of a 230,000 b/d crude project in its western Lake Albert region. The crude project had been scheduled to begin production in late 2025 — although the head of TotalEnergies' Ugandan operations recently said the company may miss this long-standing target. Batebe said the Ugandan government has plans to increase hydroelectricity capacity to around 52GW by 2050, to increase use of solar wind and nuclear power, and has a budget of $8bn by 2030 to finance these. The IEA estimates hydroelectricity accounts for around 90pc of Uganda's generating capacity. But this installed capacity is only around 1.5GW currently. The country's nuclear ambitions remain at the planning stage, and biomass — wood and charcoal — dominates energy consumption. "We want to phase out use of coal, but… countries that produced oil and gas should get out first and we shall follow," she said. "We cannot afford to remain poor. We shall produce our oil and gas responsibly, use LPG from the [planned] refinery and then connect more than the current 57pc of our population to electricity with affordability to use it for cooking and other uses other than lighting then meet our emissions targets." Batebe said the world's longest heated crude export pipeline, which will connect its oil fields with to the port of Tanga on Tanzania's Indian Ocean coast, will be insulated to "three layers" to limit emissions. TotalEnergies' Ugandan general manager Philippe Groueix said the two Lake Albert projects, Tilenga and Kingfisher, are designed to produce crude at 13kg of CO2/bl, far below the world average of 33 kg/bl. TotalEnergies is developing the 190,000 b/d Tilenga field and and Chinese state-controlled CNOOC the 40,000 b/d Kingfisher. By Mercy Matsiko Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Australia’s Queensland legislates emissions targets
Australia’s Queensland legislates emissions targets
Sydney, 18 April (Argus) — Australia's Queensland state today approved two separate laws setting renewable energy and emissions reduction targets over the next decade, as it transitions away from a coal-fired dependent power generation system. Queensland set net greenhouse gas (GHG) emissions reduction targets of 30pc below 2005 levels by 2030, 75pc by 2035 and zero by 2050 under the Clean Economy Jobs Act, while theEnergy (Renewable Transformation and Jobs) Act sets renewable energy targets of 50pc by 2030, 70pc by 2032 and 80pc by 2035. The state is on track to surpass the 2030 emissions target, latest data show, as it achieved a 29pc reduction in 2021. Even though the share of renewables in the power mix last year was the lowest across Australia at 26.9pc, it has been increasing consistently since 2015 when it was 4.5pc, according to data from the National Electricity Market's OpenNem website. Coal-fired generation has been steadily falling, down to 42.9TWh or a 65.7pc share in 2023 from 52.9TWh or 83pc in 2018. Most of Queensland's coal-fired plants belong to state-owned utilities, which the previous Labor party-led government of Annastacia Palaszczuk indicated would stop burning coal by 2035 . The new Labor party premier Steven Miles disclosed the 75pc emissions reduction target by 2035 in his first speech as leader last December. The Energy Act locks in public ownership of electricity assets, ensuring that at least 54pc of power generation assets above 30MW remain under state control, as well as 100pc of all transmission and distribution assets and 100pc of so-called "deep storage" assets — pumped hydro plants with at least 1.5GW of capacity. The government will need to prepare and publish a public ownership strategy for the July 2025-June 2030 and July 2030-June 2035 periods. A fund totalling A$150mn ($97mn) will also be set up to ensure workers at existing state-owned coal-fired power plants and associated coal mines have access to new jobs and training or financial assistance during the transition. The Clean Economy Jobs Act sees the government receiving advice from an expert panel on the measures needed to reduce emissions. The government will need to develop and publish sector plans by the end of 2025 with annual progress reports to Queensland's parliament. By Juan Weik Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
US reimposes Venezuela oil sanctions
US reimposes Venezuela oil sanctions
Washington, 17 April (Argus) — The US administration today reimposed sanctions targeting Venezuela's oil exports and energy sector investments and set a deadline of 31 May for most foreign companies to wind down business with state-owned PdV. The US decision rescinds a sanctions waiver issued last October, which allowed Venezuela to sell oil freely to any buyer and to invite foreign investment in the country's energy sector. The waiver, which was due to expire on 18 April, was tied to Caracas' agreement to hold a competitive presidential election and to allow opposition politicians to contest it. Venezuelan president Nicolas Maduro's government reneged on that deal by refusing to register leading opposition candidate Maria Corina Machado or an alternative candidate designated by her, a senior US official said. The US considered the potential effects on global energy markets and other factors in its decision, but "fundamentally, the decision was based on the actions and non-actions of the Venezuelan authorities," the official said. The separate waivers granted to Chevron and to oil field service companies Halliburton, SLB, Baker Hughes and Weatherford will remain in place. Chevron will be allowed to continue lifting oil from its joint venture with PdV, solely for imports into the US. US-bound Venezuelan crude volumes averaged 133,000 b/d last year. Chevron said its Venezuela output was 150,000 b/d at the end of 2023. Argus estimated Venezuela's crude output at 850,000 b/d in March, up by 150,000 b/d on the year. PdV said it will seek to change terms of its nine active joint ventures , starting with Spain's Repsol, in an effort to boost production. The reimposition of sanctions will primarily affect Venezuelan exports to India and China. India has emerged as a major new destination for Venezuelan crude since the US lifted sanctions in October, importing 152,000 b/d in March. There are two more Venezuelan cargoes heading to India and are expected to arrive before the 31 May deadline. The VLCC Caspar left the Jose terminal on 14 March and was expected to arrive at a yet-unknown west coast Indian port on 26 April. The Suezmax Tinos left Venezuela on 18 March and was due at Sikka on 30 April. By contrast, Chinese imports of Venezuelan Merey, often labeled as Malaysian diluted bitumen, have been lower since October. Independent refiners in Shandong, which benefited from wide discounts on the sanctioned Venezuelan crude, cut back imports to just a fraction of pre-relief levels. By contrast, state-controlled PetroChina was able to resume imports. The Merey discount to Brent already widened in anticipation of a possible reimposition of US sanctions. Reprieve expected for European companies Separate US authorizations previously issued to Repsol and to Italy's Eni to allow oil-for-debt deals with PdV and to enable a Shell project to import natural gas from Venezuela's Dragon field to Trinidad and Tobago are expected to remain in place. The US sanctions enforcers as a rule do not disclose the terms of private sanctions licenses, and the European companies were not immediately available to comment. The US would still consider future requests for sanctions waivers for specific energy projects, another senior official said. Repsol imported 23,000 b/d of Venezuelan crude into Spain last year and 29,000 b/d so far this year, according to Vortexa data. The last cargo to arrive was on 15 April. Hope springs eternal The US administration says it will consider lifting the sanctions again if Maduro's government allows opposition candidates to participate in the July presidential election. The US action today "should not be viewed as a final decision that we no longer believe Venezuela can hold competitive and inclusive elections," a third senior official said. "We will continue to engage with all stakeholders, including Maduro representatives, the democratic opposition, civil society and the international community to support the Venezuelan people's efforts to ensure a better future for Venezuela." By Haik Gugarats and Kuganiga Kuganeswaran Chinese imports of Venezuelan crude Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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