Biden to Greenlight Alaskan Oil Project // French LNG Disruptions // World Bank Supports Mozambican Gas
Biden Greenlights Alaskan Oil Project
The US Department of Interior has approved a smaller version of ConocoPhillips's $7 billion oil and gas drilling Willow project in Alaska.
The decision follows opposition from green groups who argue that the project conflicts with President Joe Biden's efforts to fight climate change. "Promoting clean energy development is meaningless if we continue to allow corporations to plunder and pollute as they wish,” Food & Water Watch Executive Director Wenonah Hauter told Reuters. But, according to the New York Times, Most Alaskan Indigenous groups support the project, including the first Alaska Native elected to Congress, Mary Peltola.
“The Willow project is a $6 billion proposal from ConocoPhillips to drill oil and gas in Alaska,” reports Reuters. “It would be located inside the National Petroleum Reserve-Alaska, a 23 million-acre (93 million-hectare) area on the state's North Slope that is the largest tract of undisturbed public land in the United States.”
The Interior Department cut the size of the proposal by 40%, denying two requested drill pads in order to lower the project’s freshwater use and prevent the development of 11 miles of roads, 20 miles of pipelines, and 133 acres of gravel. The decision comes after the Biden administration announced new protections for Alaskan land and water.
“The project could deliver 160,000 bpd of crude, the [Bureau of Land Management] said at the time, with reserves estimated at between 400 and 750 million barrels,” reports Oilprice.com. “The lifetime of the project was estimated at up to 30 years in 2019.”
French LNG Disruptions
Strikes continue to rock the French economy as the government pursues pension reforms. France’s four LNG terminals are expected to remain closed as a result.
"All the gas terminals and storages are in the hands of the strikers. Terminals are shut down. There is a decline in storage. We are waiting for Thursday when it will strengthen," a union official said.
“Prices jumped last week due to the strikes, which also lowered nuclear power generation (increasing demand for gas as a replacement),” Bloomberg’s Stephen Stapczynski tweeted.
France is a major vehicle for Europe’s LNG imports. In 2022, France took in 25.14 million tons of LNG—an 80% jump from the previous year.
World Bank Supports Mozambican Gas
The World Bank will consider supporting the development of Mozambique's natural gas reserves, which could play an important role in global energy transition, provided it is the cheapest way to boost energy access in the country.
“Our view is that we can support it if there are no other options that are least cost, and this is in the context of a clearly articulated transition plan,” Victoria Kwakwa, the World Bank’s vice president for Eastern and Southern Africa, said last week. “It can play an important role in the transition process.”
Mozambique has one of the lowest GDPs per capita in the world. Less than a third of its population—Mozambique’s total population is 32 million—has access to electricity. The bank stopped financing oil and gas extraction in 2019 but said it could fund Mozambique's natural gas projects if they helped connect more people to energy.
That the World Bank is considering funding the gas projects at all marks a huge shift in its stance on fossil fuel development. The energy shockwaves following the Ukraine war and the world need for natural gas has made total opposition to gas development an untenable position.
Regardless, Mozambique’s gas development faces challenges of its own.
“The southeast African nation over a decade ago discovered some of the biggest natural gas reserves on the continent,” reports Bloomberg. “Projects to exploit them have been held up by a $2 billion debt-fueled state corruption scandal and an Islamic State-linked insurgency. International funding has also been targeted by environmental groups that oppose the development of fossil fuels.”
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The Nuclear Regulatory Commission as approved a reactor restart. “The Nuclear Regulatory Commission announced Friday it cleared the research reactor of the National Institute of Standards and Technology to restart following a Feb. 3, 2021, shutdown due to a higher than normal radiation level leaving the reactor building,” reports Utility Dive. “The Gaithersburg, Maryland, reactor shut automatically in response to the radiation escape, the NRC said in March 2021. The incident had no significant radiological consequences for workers, the public or the environment and all safety systems functioned properly to shut the reactor, the agency said.”
Italy is eyeing nuclear energy. “Italy's biggest utility Enel and 'clean' nuclear technology company newcleo have signed an agreement to work together on the British start-up's technology projects aimed at providing safe and stable power,” reports Reuters. “The deal marks a renewed interest for nuclear around the world with large energy groups exploring the possibility of developing innovative solutions with start-ups as an alternative to fossil fuels.”
China needs up restructure its grid to accommodate more solar. “China needs to revamp its power grid to continue to absorb 100 GW and above of solar generation capacity every year, including upgrading the technology and introducing commercial business models that enable higher solar power consumption, according to experts at a recent forum hosted by China Photovoltaic Industry Association,” reports S&P Global. “China has accounted for the world's largest solar capacity addition in recent years, with around 30% of installed global capacity, but most of the low-hanging fruits have been picked, and deeper penetration into the energy mix requires overhauling large parts of the power system.”