Global Witness, a nongovernment organisation, analysed industry data and found that Belgium and Spain were the second and third-largest buyers of Russian LNG, respectively, after China in the first seven months of the year.

Between January and July of this year, EU imports of super-chilled LNG increased by 40 per cent compared to the same period in 2021.

It is important to note that this increase is from a low base, as the EU had minimal LNG imports prior to the war in Ukraine due to its reliance on piped gas from Russia.

The EU’s reliance on Russian LNG has grown despite its efforts to diversify its energy sources.

According to Global Witness, the increase in imports of Russian LNG by the European Union (EU) is much higher than the global average. While the global increase was 6 percent, the EU saw a sharper rise.

Based on data from industry analytics company Kpler, the analysis conducted by Global Witness reveals that the EU is currently importing around 1.7 percent more Russian LNG compared to the previous record high in imports last year.

The cost of the LNG imported by the EU from January to July, at spot market prices, amounted to 5.29 billion euros, according to Global Witness.

Jonathan Noronha-Gant, senior fossil fuel campaigner at Global Witness, expressed concern over the EU’s shift from piped Russian fossil gas to LNG.

“It doesn’t matter if it comes from a pipeline or a boat — it still means European companies are sending billions to [Vladimir] Putin’s war chest,” Jonathan was quoted as saying by The Financial Times.

Most of the Russian volumes come from the Yamal LNG joint venture, which is majority-owned by the Russian company Novatek.

France’s TotalEnergies, China’s CNPC, and a Chinese state fund also hold stakes in the venture. Although the venture is exempt from export duties, it is still subject to income tax.

The import levels not only result in billions of euros in revenues going to Russia, but also leave the EU vulnerable to any sudden decision by the Kremlin to cut supplies, as seen with piped gas last year.

According to Alex Froley, a senior LNG analyst at consultancy ICIS, “long-term buyers in Europe say they will keep taking contracted volumes unless it is banned by politicians”.

Analysts have stated that Spain’s utility Naturgy and France’s Total have ongoing contracts for significant quantities of Russian LNG.

It should be noted that EU has over the past year criticised India for importing Russian crude oil and then shipping derived products to Europe, which they allege indirectly fuel Putin’s war in Ukraine.

Earlier on Saturday (28 August), the EU again voiced concerns over the “rapid” rise in refined petroleum products made from Russian crude oil in India finding its way to the European market, saying it defies the purpose of the sanctions against Moscow that are aimed at reducing its ability to finance the war with Ukraine.

Speaking to the reporters during his visit to India, Valdis Dombrovskis, Executive Vice-President and Commissioner for Trade of the European Union, said that oil products refined from Russian crude oil are entering the European market in “large quantities” and the organisation is looking into solutions.

The EU Vice President also accused Russia of using its energy supplies, and food as “tools” of “war and manipulation” to continue its attack on Ukraine.

In a bid to limit Moscow’s capacity to fund the conflict in Ukraine, the Western powers have imposed a number of sanctions on Moscow since Russia invaded Ukraine in February of last year, including a price ceiling on Russian oil by G7- plus nations.

“We are obviously aware that a number of countries, including China and India have not joined those sanctions. We are aware that Russia is actively seeking alternative markets for the lost European market,” Dombrovskis said.

The EU trade commissioner said this while asked about India’s increasing trade relations with Russia, especially its procurement of discounted Russian crude oil.

“We indeed see new trade patterns emerging. Those are some issues which are also the new developments which we are currently assessing. For example, what we see is now a rapid increase of refined oil products, so to say, imports in the EU from India,” he said.

“But if they are made with Russian oil, in a sense it defies the purpose which we are putting in front of us as the EU, as a Western democratic world, to reduce Russia’s ability to wage the civil war,” he said.

“So this is something which will provide some reflection on that,” the top EU trade official added.

Earlier this year, EU Foreign Policy chief Josep Borrell has also called for fo action on imports of Indian-refined oil with Russian origins. 

“If diesel or gasoline is entering Europe . . . coming from India and being produced with Russian oil, that is certainly a circumvention of sanctions and member states have to take measures,” Borrell was quoted as saying by the Financial Times. 

In response, India’s Minister for External had said, “My understanding of the (EU) Council regulations is that Russian crude is substantially transformed in a third country then it is not treated as Russian anymore. I would urge you to look at Council’s Regulation 833/2014″.

“There is, I think, no doubt about the legal basis of the sanctions,” he said.

The minister further added that Europe has managed to reduce its imports while doing it in a manner that is comfortable.

“If at a (per capita income) of €60,000, you are so caring about your population, I have a population of $2,000. I also need energy, and I am not in a position to pay high prices for oil,” he said.

https://swarajyamag.com/business/after-lecturing-india-on-russian-oil-purchases-eu-imports-record-volumes-of-lng-from-russia

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One, it has opted for an asset ownership and operatorship model and second, it has decided to house all its green energy interests under a subsidiary.

Company executives said, the JV was aimed at addressing buildownoperate prospects and the subsidiary model will allow the scope for financial partners at a later stage, if needed.

Last week, L& T formed a joint venture (JV) company named GH4India Private Limited, along with Indian Oil Corporation (IOC) and Renew, with an interest of 33.33 per cent each.

In its announcement, L& T said the JV is for the development of green hydrogen and its derivatives, production assets and associated renewable assets through any model of ownership and operatorship.

L& T looks to sell green hydrogen and not just the equipment related to its manufacturing.

Derek M Shah, senior vice president and head, L& T Energy-green manufacturing and development, at L& T said: “L& T maintains its strategy of pursuing an assetlight approach.” “ We also recognise the opportunities that exist in the energy transition journey.

Green hydrogen is indeed one of the emerging opportunity areas for us to leverage our leadership position in the energy sector and expertise in manufacturing and EPC projects,” Shah explained.

GH4India will allow the company to address Build Own Operate (BOO) prospects in green hydrogen & derivatives space, “in a manner that does not return dilutive to L&T,” he said.

Top executives from L& T have earlier said the three partners combined will look to invest close to $ 3 4 billion over the next three to five years.

L& T moved to an asset light model more than a decade back, after investments under the asset ownership model in different infrastructure projects, yielded mixed results.

In 2014, L&T, along with Tata Steel, exited from the ownership of Dhamra port in Odisha, through a sale to Adani Ports and SEZ. Last financial year, L& T announced full exit from its road portfolio joint venture L& T Infrastructure Development Projects (IDPL).

As a solo venture, L& T is also building an electrolyser manufacturing facility in Hazira, Gujarat.

In July, L& T said its subsidiary L& T Energy Green Tech will act as a holding company, for creating a focused entity structure that will house multiple business portfolios of green energy, including electrolyser manufacturing.

This is a detour from L&T´s preferred model of creating business divisions for engineering, procurement and construction opportunities in different segments.

Firm to target buildownoperate opportunities, a shift from ´ assetlight´ policy CHANGING TACK

From Business Standard Paper

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“Adani Global, Singapore, a step-down wholly-owned subsidiary of (Adani Enterprises) has signed (the) JV agreement,” the group flagship firm said in an exchange filing.
Adani Group is investing multi-billion dollars in setting up facilities to produce green ammonia and green hydrogen from water.
Adani and Kowa will hold a 50% stake each in the joint venture. The group didn’t provide further details.

https://timesofindia.indiatimes.com/business/india-business/adani-forms-joint-venture-for-green-hydrogen/articleshow/103519877.cms?from=mdr

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BRTC submitted a proposal to the Executive Eommittee of the National Economic Council in the past month seeking approval to purchase the buses from South Korea under loan worth Tk 826 crore from the same country, said the planning commission officials.

The officials said a meeting of the ECNEC would be held today to review the BRTC proposals and 18 other proposals.     

The state-owned BTRC’s net loss stands at Tk 974 crore in the past 14 years, according to the Economic Review 2023.

The corporation could face problems with the availability of CNG if the current shortage in supply continues in the coming days, said Farhan Noor, general secretary of Bangladesh CNG Filling Station and Conversion Workshop Owners Association.

Around 50 CNG stations out of 590 across the country have been kept closed amid low gas pressure in the day time, he said.

He added that the pressure of gas in the CNG stations was almost one-fifth of requirement.

‘We get gas at proper pressure during midnight only,’ said the general secretary, adding that currently most fuel stations in the capital refrain from giving CNG fillings to buses.

Falling production at the local level for past several years combined with interruptions in import amid a dollar crisis has resulted in the short supply of CNG in the country.

Once being able to meet the national demand with the local production, Bangladesh began import of liquefied natural gas in 2019 to meet the growing demand for industries, including power, fertilizer and readymade garments.

Around 25 per cent of the annual demand of natural gas is imported, according to the Petrobangla.

However, the shortage of dollars and price hike of the item in the global market forced the state-owned corporation Petrobangla to suspend import for six months in the past year.

Bangladesh Bank has already imposed import restriction on many products, while supplied dollars on priority basis in a bid to safeguard the foreign exchange reserves tumbled to around net $22 billion recently from $48 billion in August 2021.

BRTC chairman Md Tazul Islam dismissed any crisis of CNG for the proposed buses, referring to the assurance from the energy division.

He said the energy division has already given positive reaction about the import of CNG-run buses to be fielded to commute passengers to and from the metro rail stations.

He noted that the energy division has assured they would supply the gas through converting LNG.

BRTC purchases buses under the annual development programme at regular intervals and has also sought loans from the finance ministry.

Its overall debt liability to the government, according to finance division, stood over Tk 700 until 2021.

In FY11, the BRTC purchased 255 CNG-run air-conditioned and non-AC buses from South Korea’s Daewoo of which only a few are in operation now. In FY12, it procured 290 Ashok Leyland double-decker buses from India.

In FY20, BRTC purchased 100 non-AC buses from India’s Tata with a life expectancy of 12 years. Besides, it bought 638 Ashok Leyland buses – 50 articulated ones, 88 AC single-deckers, 300 double-deckers, 200 AC single-deckers – between FY13 and FY20.

The corporation has around 1,350 buses in its fleet.

https://www.newagebd.net/article/211279/brtc-to-import-cng-buses-amid-gas-crisis

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The plan includes drilling ten wells between July 2022 and June 2023 which resulted in the huge discovery in the Nargis Offshore Area Concession, which added reserves of 2.5 trillion cubic feet, stated Tarek El-Molla Minister of Petroleum and Mineral Resources.

According to Ahram Online, El-Molla added that during the years 2023/2024 and 2024/2025, a total of 35 exploratory wells will be drilled with USD 1.5 billion in investments.

He said that there is another plan to drill 25 wells in the Zohr Field area to increase the field capacity, which reached 2.2 billion cubic meters per day.In a similar vein, global energy giant British Petroleum (BP) is planning to invest USD 3.5 billion in the exploration and development of natural gas resources in Egypt over the next three years.

Egypt has been taking steps towards developing the energy sector to position itself as an energy hub. The country expects to produce about eight million tons of LNG in 2023 after discovering a new gas field in the Nargis area in January.

https://aninews.in/news/world/others/egypt-plans-to-drill-45-exploratory-gas-wells-in-mediterranean-delta-until-mid-202520230830182855/

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The U.S. emerged in 2022 as the world’s second largest LNG exporter on plentiful supplies of natural gas and relatively low processing costs per metric ton of LNG. But rising interest rates and higher construction costs have pushed up liquefaction fees, also known as tollingfees.

“We would naturally expect increased costs of project development, due to higher interest rates or other factors, to have a corresponding impact on liquefaction fees,” said Lyle Hanna, a vice president at Commonwealth LNG, one of several U.S. LNG export projects working toward financial approvals.

Since Russia’s invasion of Ukraine last year, the Dutch Title Transfer Facility (TTF) price has been much higher and is unlikely to return to the pre-invasion price levels, said Jason Bennett, a partner at law firm Baker Botts who negotiates LNG contracts.

Bennett said the willingness by long-term customers to pay higher tolling fees and ultimately higher prices for U.S. LNG was because newer projects are still providing very good margins due to the low gas prices at the Henry Hub, the main trading point for U.S. natural gas futures.

“U.S. LNG remains the best source of low cost LNG in the world…If the price used to be $2.25 (per million British thermal units) and it’s $2.75 now, ok, but it’s still the cheapest price of LNG anyway,” said Bennett.

The most recently approved project – NextDecade NEXT.O’s Rio Grande LNG – increased its liquefaction fee as project costs rose, said Jason Feer,global head of business intelligence at LNG shipping and brokering firm Poten & Partners.

“NextDecade went back to their offtakers and sought an adjustment of their contract levels and our understanding is most of them agreed,” Feer told Reuters.
NextDecade did notreply to questions about its processing fees. However, in a July 20 filing with the Department of Fossil Energy and Carbon Management, NextDecade revealed amendments to its contracts with all its long-term customers except France’s TotalEnergies TTEF.PA and Japanese trading house Itochu 8001.T.

“The offtakers agreed because the project was very far advanced and was ready to go to FID (financial investment decision) and I think some of those contracts were very low-priced by current standards,” Feer said.

The largest U.S. LNG exporter Cheniere Energy LNG.A has cut its project financing costs by funding its newest Stage 3 expansion project from its balance sheet.

“Increasing our own equity in our projects and thereby reducing the level of debt required us to fund our expansions and is a competitive advantage,” the company said.

Other developers are turning to increased equity investment in new projects to reduce the impact of higher interest rates on finance costs, said Poten’s Feer.

https://www.hellenicshippingnews.com/us-lng-projects-win-higher-processing-fees-as-interest-rates-climb/

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