Norway’s Decision To Step Up Oil Exploration Angers Climate Activists

By Irina Slav - May 23, 2023, 

• Earlier this month, the Norwegian energy ministry said the country would be stepping up oil and gas exploration in the Norwegian continental shelf.
• Climate activists: Norway's increased exploration efforts are “a middle finger to the Paris Agreement,”.
• Norway's Energy Minister urged companies to “leave no stone unturned” to boost gas production.

Earlier this month, the Norwegian energy ministry said the country would be stepping up oil and gas exploration in the Norwegian continental shelf to improve its energy security and the energy security of its friends and neighbors in Europe.

Traditionally one of Europe’s biggest natural gas suppliers, Norway last year became the biggest single one as flows of Russian gas all but stopped. And it seems this is a place Norway would like to remain.

“The petroleum adventure in the north has only just started,” Petroleum and Energy Minister Terje Aasland said in early May, calling on Norway’s oil and gas companies to fulfill their “social responsibility” to ensure the energy security of the country and “leave no stone unturned” to boost gas production. To say that climate activists did not take this well is to say nothing.

Norway is notorious for its clean grid – thanks to its abundant hydropower resources that climate campaigners don’t like to talk about very much – and its per-capita EV ownership, which is the highest in the world: a feat made possible by the combination of a small population and a high standard of living, not least thanks to oil profits.

Speaking of oil profits, Norway’s sovereign wealth fund, which is the largest in the world, last year set itself a target to make its portfolio net-zero by 2050. The fund is already divesting from some fossil fuel holdings to much media coverage and activist cheers.

Now, suddenly, it is socially responsible for Norway’s energy industry to boost the production of those same fuels that the sovereign wealth fund has been divesting from, albeit sparingly. Activists have every right to be outraged, and this is exactly what they are.

“Oil drilling in the Arctic is like pouring gasoline on a fire,” the head of Greenpeace Norway told CNBC.

“Both Norway and the oil corporations need to stop cynically exploiting Russia’s war in Ukraine,” Frode Pleym also said. “The aggressive and greedy oil policy of Norway do not only consolidate Oslo’s position as a top energy supplier to Europe, it locks a whole continent into future dependency on fossil fuels. The alternative to oil and gas is not more oil and gas, it is more energy efficiency and renewable energy.”

These comments chime in with a line of criticism from the climate activist lobby against European policies for dealing with last year’s energy crunch that have effectively stimulated more oil and gas use, including through direct subsidies at the pump.

It is a line of criticism that is difficult to dismiss: by shouldering part of the increased cost of fuels, European governments indeed stimulated more oil use than would have otherwise been affordable for most. Of course, discouraging oil use by refusing to cover the increased costs would have fuelled a much higher inflation rate, too, but this is not on top of the climate change agenda.

Activists are understandably angry with the Norwegian government, but the government’s focus on energy security is equally understandable. The whole world saw what happens when energy security is compromised. No one would like to see a repeat of that. And Norway has the resources and expertise to bring them to market.

This is “a middle finger to the Paris Agreement,” according to climate activists cited by CNBC. Perhaps it is, but if Europe’s year of crisis showed us one thing, it is that when energy security is involved, the Paris Agreement takes a back seat. The latest proof of this was this weekend’s G7 meeting, where leaders agreed on continued gas investments depite the Paris Agreement. Energy security trumps the transition every time.

By Irina Slav for Oilprice.com

U.S. Extends License To Operate In Venezuela To Oilfield Services Companies

By Julianne Geiger - May 23, 2023

• The Biden Administration has extended a waiver that authorizes a few oilfield services companies to keep assets in Venezuela.
• 
  
• The license to preserve oilfield assets was originally granted back in 2019 to U.S. oilfield services providers Baker Hughes, Halliburton, Schlumberger, and Weatherford International.
• 
  
• Chevron also secured a license—but Chevron’s license is more extensive.

The United States has renewed a license that will extend the authorization to select oilfield services companies to keep assets in Venezuela. The license does not allow the companies to drill, process, or handle Venezuelan-derived crude oil, Reuters reported on Tuesday.

The license to preserve oilfield assets was originally granted back in 2019 to U.S. oilfield services providers Baker Hughes, Halliburton, Schlumberger, and Weatherford International. The license allows them to maintain a physical presence in the country, including their assets, but does not allow them to perform any operations with PDVSA or any JVs, including well maintenance.

Chevron also secured a license—but Chevron’s license is more extensive. Chevron is the only U.S. company allowed to do business in Venezuela after obtaining a six-month license to operate under its joint ventures with PDVSA. Profits from Chevron’s Venezuelan-derived crude oil will go towards paying down PDVSA’s debt to Chevron, and will not contribute to the state-run oil company’s profits.

Venezuela’s oil industry has been hit hard by corruption, mismanagement, and U.S. sanctions. Venezuela relies heavily on crude oil revenues to finance its budget. For 2023, Venezuela was planning to finance 63 percent of its budget with oil revenues.

Venezuela’s oil exports did increase in March, reaching their highest levels since last August, carried mostly by Chevron’s activity there. Venezuela exported nearly 775,000 bpd in March, with China, its largest buyer.

Some oilfield services companies, including Baker Hughes, had pushed last year to restart drilling in the sanctioned South American country, with analysts suggesting that doing so could boost Venezuela’s crude production back above 1 million barrels per day.

The oilfield services firms have been prohibited from conducting business in Venezuela since 2019.

By Julianne Geiger for Oilprice.com

S&P Global Warns That A U.S. Default Would Wreak Havoc On Global Energy Markets

By Irina Slav - May 24, 2023

• As the standoff over raising the debt ceiling continues, the United States is potentially days away from running out of cash and defaulting on its debt.
• 
  
• S&P Global Commodity Insights has warned that a U.S. debt default would wreak havoc on global energy markets by driving demand down.
• 
  
• This is not the first time the debt ceiling has been used by politicians as a bargaining chip, and S&P Global believes the chance of a default is slim.

A debt default by the U.S. federal government would shake up the global energy market, S&P Global Commodity Insights has warned, adding, however, that the chance of that happening was a slim one.

Congress is at an impasse about the debt ceiling and recent talks between President Biden and House Speaker Kevin McCarthy ended with no agreement on lifting the borrowing limit.

In truth, the default alarm gets sounded every time Congress debates the debt ceiling, and so far legislators have invariably been able to avoid a default. Should this change, it would lead to a severe recession, which would in turn affect energy demand, according to the president of S&P Global Insights who spoke to The National.

“I think markets generally believe at this point that at the last minute either a deal will get worked out or the administration will find technical ways to get around the congressional approval they need to be able to service the debt,” Saugata Saha told the Emirati daily.

If this does not happen, “It will likely lead to severe recessions, which again will have an impact on energy consumption and demand,” Saha also told The National.

According to finance officials, including Treasury Secretary Janet Yellen, the U.S. federal government will run out of money by the beginning of next month, which means time on a deal is running out.

Democrats insist that Congress passes a higher debt ceiling with no changes in spending while Republicans insist on spending cuts claiming current levels are unsustainable.

The debate is already affecting oil prices as fears of a default grow. However, if a deal gets clinched at the last moment or legislators find another way to raise the ceiling, oil prices will likely move higher in the absence of other bearish factors.

By Irina Slav for Oilprice.com

 

Petrobras To Appeal Amazon Oil Rejection In Lula Litmus Test

By Tom Kool - May 24, 2023

• Last week, Brazil's Ibama environmental agency rejected the environmental license for exploratory drilling in the deep waters of the Amapa at the mouth of the Amazon.
• The ruling indicates a fracture in the Lula camp that has created two factions, one keen to drive oil drilling forward, and the other more concerned with protecting the environment.
• 
  
• Brazil’s state-run oil giant Petrobras is preparing to file a request to appeal the decision.

Brazil’s state-run oil giant Petrobras is preparing to file a request to appeal a decision to reject the environmental license for exploratory drilling in the deep waters of the Amapa at the mouth of the Amazon. Claiming that it has already met the project’s technical needs, Petrobras said it would comply with additional requirements from the country’s Ibama environmental agency to gain approval for the drilling of a exploratory well in bloc FZA-M-059. 

Last week, Ibama ruled to block the drilling in a major blow to the government of President Luiz Inacio Lula da Silva. 

The ruling indicates a fracture in the Lula camp that has created two factions, one keen to drive oil drilling forward, and the other more concerned with protecting the environment. This inter-camp rivalry has led Lula to proceed more cautiously, with Amazon oil now positioned as an important litmus test for the administration. 

In terms of additional measures Petrobras would be willing to take, the oil giant committed to expanding a “fauna stabilization base in the city of Oiapoque in addition to a base already built in Belem, so that in the remote possibility of an oil spilling assistance to the fauna can be carried out in both locations," according to a statement. 

Earlier this week, Ibama head Rodrigo Agostinho told CNN that the environmental regulator was not likely to grant Petrobras’ appeal, citing the agency’s refusal to bow to political pressure. "Petrobras can resubmit the request, but most likely the technical team will not change its opinion without changes to the project," added Agostinho. Agostinho’s statement followed Lula’s comments that it would be “difficult” to imagine drilling in the mouth of the Amazon causing environmental problems to the rainforest. 

By Tom Kool for Oilprice.com

Finland’s Electricity Prices Fall Below Zero

By Tsvetana Paraskova - May 25, 2023

Surging hydroelectric power, new nuclear reactors online, and an influx of solar and wind capacity additions sent electricity prices in Finland below zero on Wednesday, in a stark reversal from last year when residents were warned of shortages after Russia cut off pipeline gas supply to its EU neighbor.  

“The average price for the day is now slightly, but nevertheless, on the negative side. Yes, it is historic,” Jukka Ruusunen, chief executive officer of grid operator Fingrid, told local news outlet Yle.

Abundant meltwater is raising hydropower production, while the newest nuclear reactor in Europe – and the biggest by capacity – started producing electricity in Finland last month. Olkiluoto 3, which has completed test production and is now regularly producing electricity, is expected to account for 30% of Finland’s power generation, the plant operator, TVO, says.

Operational issues have plagued the 1,600 MW reactor for years. But now it is expected to produce electricity for the next 60 years and is a significant addition to clean domestic production, TVO said.

After the start-up of Olkiluoto 3, power prices in Finland saw a 75% plunge between December 2022 and April 2023.  

In addition, growing solar and wind capacity is also contributing to a cleaner and more abundant power supply in Finland.

“Last winter, the only thing people could talk about was where to get more electricity. Now we are thinking hard about how to limit production. We have gone from one extreme to another,” Ruusunen told Yle.

“Now there is enough electricity, and it is almost emission-free. So you can feel good about using electricity,” Fingrid’s CEO said.

In another significant boost to Finland’s renewable energy capacity, Copenhagen Infrastructure Partners (CIP) and Myrsky Energia (Myrsky) on Wednesday announced a partnership to develop more than 1.8 GW of onshore wind power in Finland.

“This transaction puts Finland on track to become a European leader in the energy transition and will make a material contribution toward Finland’s 2035 carbon neutrality target,” CIP said in a statement.  

By Tsvetana Paraskova for Oilprice.com

Germans Are Outraged About The Country's Oil And Gas Boiler Ban

By Irina Slav - May 26, 2023

Germans are criticizing a government plan to ban oil and gas boilers and replace them with heat pumps, arguing it is happening too fast and is going to cost a lot of money.

Germany wants to become net-zero by 2045. To this end, the government recently announced it would ban boilers working with fossil fuels, effectively forcing people to switch to heat pumps as the only green enough option for people with no access to district heating.

The cost of the ban is estimated at over 9 billion euros, or $10 billion, annually until 2028. After that, according to the Scholz government, costs will drop by almost half thanks to a ramp-up in heat pump production and a scale-up of wind and solar capacity.

The government is offering financial help to households, to the tune of 30% of the cost of the switch but Germans appear to not be particularly enticed by that offer.

“People are outraged and furious,” Petra Uertz of the Residential Property Association told the Financial Times. “They can’t understand why it has to happen so quickly.”

“This law affects 66mn Germans . . . and there is enormous disquiet,” according to Marie-Agnes Strack-Zimmermann, a senior MP from the liberal Free Democratic Party.

The FDP is one of the three parties in the coalition government led by Olaf Scholz and it is not a fan of the gas boiler ban.

“We shouldn’t be tying it to a particular date come hell or high water, there are things in it that must be changed first,” Strack-Zimmermann told German media, saying the Green Party’s insistence on passing the ban as law before the summer break was absurd.

The Green Party, by the way, is losing popular support faster than snow melts in May. According to the latest figures, as presented by the FT, it is now less popular than the right-wing Alternative for Germany, with a popularity rating of 14%.

What’s more, the ban has triggered a jump in demand for gas boilers: it would only come into effect as of January next year, so if people install boilers before this year’s end, they can keep using them.

1,650 North Sea Oil & Gas Workers To Strike In Biggest Walkout So Far

By City A.M - May 23, 2023

Around 1,650 North Sea offshore contractors will begin two new rounds of 48-hour strike action in what a trade union said is the biggest walkout in the sector so far.

The workers are striking in an increasingly bitter dispute over jobs, pay and conditions in the offshore sector, Unite said.

The union says BP and Shell recorded “historic profits” of a combined £11.7 billion in the first quarter of 2023.

Offshore workers also walked out in April and May.

The latest strike will hit oil giants including BP, Shell and Repsol.

Contractors across five companies, including Bilfinger UK Limited, Stork Technical Services and Sparrows Offshore Services will walk out from 6.30am on June 1 until 6.29am on June 3 and then from 6.30am on June 8 until 6.29am on June 10.

Around 600 Bilfinger contractors on the Ithaca, CNRI and Taqa rigs rejected new pay offers, Unite said.

Two hundred Bilfinger contractors working on BP and Repsol assets will also join the strike and around 650 Stork offshore members will join the stoppages in June, along with 200 offshore workers employed by Sparrows.

This comes as climate protestors targeted Shell’s annual general meeting this morning, taking particular aim at chair Andrew Mackenzie.

Unite general secretary Sharon Graham said: “With the support of their union Unite, an army of 1,650 offshore workers are taking the fight to multibillion oil and gas corporations.

“The latest rounds of strike action in June will see the biggest group of offshore workers to date taking strike action.

“Unfettered corporate profiteering at the expense of our members will not go unchallenged. Unite is determined to deliver better jobs, pay and conditions in the offshore sector, and deliver we will.”

John Boland, Unite’s industrial officer, said: “Unite’s members deserve a much bigger share of the bonanza profits being recorded by oil and gas operators than the real-terms pay cuts currently being offered.

“Around 1,650 members across the companies we are in dispute with remain determined, and fully focused on securing a better deal.

“Whether it is over delivering improved pay, fairer and safer working rotas or holidays, Unite has one simple message for the contractors and operators: we will stand up for our members, we hold you to account, and in the end we will win.”  Press Association –  Lauren Gilmour

By CityAM

Japanese firms invest in maritime nuclear developer Core Power

24 May 2023

More than a dozen Japanese companies have invested a combined total of about USD80 million in the UK-based Core Power, which is helping develop a floating molten salt reactor (MSR) nuclear power plant and other maritime applications, according to Nikkei Asia.

(Image: Core Power)

The companies include Onomichi Dockyard and Imabari Shipyard, according to Nikkei. Its report, which has been highlighted on Core Power's website, says the Japanese companies "have subscribed to a third-party allocation of new shares by Core Power - the British company raised about USD100 million and is now majority-owned by Japanese companies".

A multinational team including Core Power, Southern Company, TerraPower and Orano USA are part of the Molten Chloride Reactor Experiment which aims to see the "world's first fast-spectrum salt reactor achieve criticality", to be built at Idaho National Laboratory, backed by US Department of Energy (DOE) funding. Last year Core Power, MIT Energy Initiative and Idaho National Laboratory were granted research funding by the US DOE's Nuclear Energy University Program, a three-year study into the development of offshore floating nuclear power generation in the USA.

Core Power has stressed the safety benefits of molten salt reactors noting that the fuel and the coolant are mixed in a fuel-salt which is liquid at high temperatures and "using a liquid fuel where the fuel and coolant are the same, has immense implications on the safety of the reactor system, as a loss of coolant accident is impossible. An MSR cannot melt-down, because the fuel is already liquid and since the fuel is locked into the coolant, toxic radioisotopes which are formed in the fission process cannot escape into the environment in the event of an accident". As Core Power Chairman and CEO Mikal Bøe put it in a World Nuclear News interview in 2021: "A ship may be lost at sea and may sink to 8000 metres on the ocean floor, but even then, it would not pollute the environment" with the MSR fuel "cooling until it's a solid rock and that solid rock should be entombed inside the reactor vessel".

Floating nuclear power plants are seen as having future growth potential because they provide flexible location options, being placed at sea from where they can provide electricity or hydrogen or water desalination for onshore use and Core Power says its aim is also to produce "a competitive true-zero emission power system for the future of maritime by 2030".

Researched and written by World Nuclear News

Japan Court Dismisses Citizens' Concerns, Paves Way For Nuclear Power Restart

By ZeroHedge - May 25, 2023,

• On Wednesday, a district court in Japan dismissed residents' calls to halt the restart of the No.2 unit of the Onagawa nuclear plant.
• 
  
• The plant is expected to resume operations early next year.
• 
  
• In the last nine months, Japan has reevaluated its energy policies following a decade of paralysis of nuclear power generation as fossil fuel energy costs soar. 

On Wednesday, a district court in Japan dismissed residents' calls to halt the restart of a nuclear reactor. This represents a victory for the Pacific island nation, grappling with soaring energy costs fueled by the prolonged war in Ukraine. 

The Japan Times reports Sendai District Court in northeastern Japan has ruled Tohoku Electric Power can restart the No. 2 unit of the Onagawa plant early next year. It will become the first unit to restart since the nuclear power plant was idled after the devastating 2011 earthquake and tsunami that triggered the meltdown at Fukushima. 

Judge Mitsuhiro Saito rejected residents' calls that claimed an evacuation plan was inadequate. Residents said if a nuclear accident occurred, many wouldn't be able to escape outside an 18.5-mile radius of the plant because of traffic jams. They said they would be exposed to radiation. 

"It cannot be assumed that a specific danger of an accident exists that leads to the abnormal release of radioactive materials," said Saito.

Tohoku Electric was seeking a dismissal of the lawsuit because evacuation plans had already been approved by the country's nuclear disaster prevention council. 

"The court acknowledged our claim.

"We will continue to cooperate as much as possible to improve the effectiveness of the evacuation plans," Tohoku wrote in a statement. 

In response to the ruling, Tohoku shares jumped nearly 8% in Tokyo trading on Wednesday. 

In the last nine months, Japan has reevaluated its energy policies following a decade of paralysis of nuclear power generation as fossil fuel energy costs soar. 

Here's our reporting on the U-turn: 

• In Stunning Post-Fukushima Shift, Japan To Build More Nuclear Power Plants
• Post-Fukushima Shift: Political And Public Support Rises In Japan For More Nuclear Plants
• Global Energy Crisis Forces Japan To U-Turn On Its Nuclear Policy
• Japan's Government Adopts Nuclear Energy Policy In Major Turnaround Amid Energy Crisis

Meanwhile, Asia is rapidly building nuclear power plants: because it's the future of decarbonized power grids.

The U-turn in Japan's policy comes after we recommended uranium stocks in December 2020. We stated back then that nuclear would be accepted as one of the most stable "clean energy" sources to meet silly climate change targets. 

By Zerohedge.com

IAEA strengthens cooperation with China

23 May 2023

Several agreements were signed between the International Atomic Energy Agency (IAEA) and Chinese entities during the opening day of IAEA Director General Rafael Mariano Grossi's first official visit to China since taking office in 2019.

The signing of agreements between the IAEA and CAEA (Image: CAEA)

At the invitation of the China Atomic Energy Agency (CAEA), Grossi is visiting China from 22 to 26 May. He will meet with several high-level officials and visit nuclear facilities and institutions in Beijing, Shanghai and Shandong during his visit.

"China is one of the IAEA's most important partners and a global leader in nuclear energy," Grossi said. "This week's agenda will cover the remarkable progress of China's nuclear energy programme, cooperation in nuclear applications and indispensable exchanges on non-proliferation and nuclear safety."

On 22 May, Grossi and other IAEA officials signed several agreements at the CAEA. The IAEA said the agreements will strengthen cooperation on small modular reactors, nuclear fusion, and nuclear data, fuel cycle and waste management, as well as communication activities. An agreement was also signed in support of Rays of Hope, the IAEA initiative to promote cancer care for all by improving availability of radiotherapy services, medical imaging and nuclear medicine that are critical for detecting and curing this disease.

"I thank CAEA Chairman Zhang Kejian for the wide-ranging and open exchange on all areas of our rich bilateral agenda, from China's nuclear energy programme to technical cooperation, non-proliferation and nuclear safety and security," Grossi said.

China has been a member of the IAEA since 1984 and is currently involved in 93 IAEA technical cooperation projects - spanning national, regional and interregional activities - in addition to 49 coordinated research projects.

Grossi yesterday designated China's Nuclear and Radiation Safety Centre as an IAEA Collaborating Centre, highlighting the country's commitment to nuclear safety and the potential to strengthen bilateral relations. China is also home to two other IAEA Collaborating Centres: the Chinese Academy of Agriculture Sciences for research, development and capacity building of nuclear techniques in food and agriculture, and the CAEA for research, development, testing and training on nuclear security detection and physical protection technologies.

Grossi also visited China's State Nuclear Security Technology Centre, on the outskirts of Beijing. "Nuclear security is an essential component for the successful development of nuclear energy," he said. "China's State Nuclear Security Technology Centre and the IAEA will further strengthen our collaboration, in particular with IAEA's nuclear security centre in Seibersdorf." The centre is part of the International Network for Nuclear Security Training and Support Centres (NSSC Network), which is coordinated by the IAEA and plays a key role in international cooperation and the sharing of best practices in nuclear security.

At the China Institute of Atomic Energy (CIAE), the main research institute of the China National Nuclear Corporation (CNNC), Grossi met with researchers and discussed the role of nuclear technology to address current challenges. "CIAE showcases impressive developments of nuclear technology in China, including the advanced research reactor and proton cyclotron," he noted.

Grossi is also due to meet with representatives of China's Ministry of Foreign Affairs, Ministry of Ecology and Environment, and the China International Development Cooperation Agency. He will visit Tsinghua University, Peking Union Medical College Hospital and the Shidaowan nuclear power plant, among other nuclear facilities and institutions.

Researched and written by World Nuclear News