World Nuclear News

Chernobyl's protective shelter damaged 'by drone strike'

Friday, 14 February 2025

International Atomic Energy Agency staff at the Chernobyl site say "radiation levels inside and outside remain normal and stable" after a drone was reported to have struck the roof of the shelter built over the remains of the reactor destroyed in the 1986 accident.

(Image: IAEA/X)

The IAEA, posting on the social media site X, said their team at the site heard an explosion at around 01:50 local time coming from the New Safe Confinement (NSC) shelter, with photos showing flames from the apparent impact point towards the top of the structure.

They were told that the damage had been caused by a drone and added: "Fire safety personnel and vehicles responded within minutes. At this moment, there is no indication of a breach in the NSC’s inner containment. Radiation levels inside and outside remain normal and stable. No casualties reported. IAEA continues monitoring the situation."

IAEA Director General Rafael Mariano Grossi said the incident at Chernobyl and recent military activity in the Zaporizhzhia nuclear power plant area showed "there is no room for complacency, and the IAEA remains on high alert".

The two shelters covering the accident site
 

Chernobyl Nuclear Power Plant's unit 4 was destroyed in the April 1986 accident (you can read more about it in the World Nuclear Association's Chernobyl Accident information paper) with a shelter constructed in a matter of months to encase the damaged unit, which allowed the other units at the plant to continue operating. It still contains the molten core of the reactor and an estimated 200 tonnes of highly radioactive material. 

 However it was not designed for the very long-term, and so the New Safe Confinement - the largest moveable land-based structure ever built - was constructed to cover a much larger area including the original shelter. The New Safe Confinement has a span of 257 metres, a length of 162 metres, a height of 108 metres and a total weight of 36,000 tonnes and was designed for a lifetime of about 100 years. It was built nearby in two halves which were moved on specially constructed rail tracks to the current position, where it was completed in 2019.

The original shelter is now within the New Safe Confinement (File Picture, Image: EBRD)

It has two layers of internal and external cladding around the main steel structure - about 12 metres apart - with the IAEA reference to the inner containment not being breached thought to refer to the inner section. The NSC was designed to allow for the eventual dismantling of the ageing makeshift shelter from 1986 and the management of radioactive waste. It is also designed to withstand temperatures ranging from -43°C to +45°C, a class-three tornado, and an earthquake with a magnitude of 6 on the Richter scale.

According to World Nuclear Association, the hermetically-sealed New Safe Confinement allows "engineers to remotely dismantle the 1986 structure that has shielded the remains of the reactor from the weather since the weeks after the accident. It will enable the eventual removal of the fuel-containing materials in the bottom of the reactor building and accommodate their characterisation, compaction, and packing for disposal. This task represents the most important step in eliminating nuclear hazard at the site - and the real start of dismantling".

What do we know about the damage to the shelter?
 

According to the operators of the Chernobyl Nuclear Power Plant (ChNPP) site, the arch-shaped New Safe Containment was struck at a height of 87 metres and "the impact occurred above the premises housing technological equipment that ensures the remote operation of the Confinement. As a result, both the external and internal cladding of the NSC Arch were damaged, along with equipment from the Main Cranes System. Additionally, local fire was detected on the external and internal cladding of the NSC Arch".

The damage to the outside (Image: IAEA/X)

The damage from the inside (Image: ChNPP)

The damage being inspected during daylight (Image: ChNPP)

Firefighters put out the fire, with ChNPP saying that "due to the breach in the cladding, the conditions and limits of safe operation established by the Technological Operation Regulations of the NSC and Shelter Object have been violated".

They added that there were no casualties and no release of radioactive substances with radiation levels at their usual levels and "the situation is under control".

The wider context
 

Chernobyl nuclear power plant lies about 130 kilometres north of Ukraine's capital Kyiv, and about 20 kilometres south of Belarus. A 30-kilometre exclusion zone remains around the plant, although some areas have been progressively resettled. Three other reactors at the site, which was built during Soviet times, continued to operate after the accident, with unit 3 the last one operating, until December 2000.

When Russia launched its invasion of Ukraine in February 2022 it rapidly took control of the Chernobyl plant. Its forces remained there until withdrawing on 31 March 2022 and control returned to Ukrainian personnel. The IAEA has had experts stationed at the site as the war has continued, seeking to help ensure the safety and security of the site.

IAEA teams are also in place at Ukraine's three operating nuclear power plants and the Zaporizhzhia nuclear power plant, which has been under the control of Russian forces since early March 2022.

Ukraine has blamed Russia for the drone strike, while Russia denied it was responsible and blamed Ukraine. The IAEA has not attributed blame to either side during the war, with Director General Grossi explaining in a press conference at the United Nations in April last year that this was particularly the case with drones, saying "we are not commentators. We are not political speculators or analysts, we are an international agency of inspectors. And in order to say something like that, we must have proof, indisputable evidence, that an attack, or remnants of ammunition or any other weapon, is coming from a certain place. And in this case it is simply impossible".

Modi, Trump commit to US-India partnership

Friday, 14 February 2025

The leaders of India and the USA have said their nations will work together towards the construction of large-scale US-designed nuclear reactors in India and facilitating further collaboration including the deployment small modular reactors.

Prime Minister Modi and President Trump pictured during the official visit (Image: Prime Minister of India)

In a joint statement issued during the official visit to the USA by Prime Minister Narendra Modi, the two leaders agreed that energy security was fundamental to economic growth, social well-being and technical innovation in both countries and "re-committed to the US-India Energy Security Partnership, including in oil, gas, and civil nuclear energy".

The joint statement paid particular attention to the two countries' view of the importance of hydrocarbons, and enhancing production "to ensure better global energy prices and secure affordable and reliable energy access for their citizens" as well as the value of strategic petroleum reserves "to preserve economic stability during crises". They also said they would increase energy trade, and "establish the United States as a leading supplier of crude oil and petroleum products and liquified natural gas to India".

Turning to nuclear, they "announced their commitment to fully realise the US-India 123 Civil Nuclear Agreement by moving forward with plans to work together to build US-designed nuclear reactors in India through large scale localisation and possible technology transfer".

Bilateral nuclear cooperation agreements, specified under Section 123 of the US Atomic Energy Act, are a prerequisite for the transfer of nuclear energy-related materials and components between the USA and another country. The USA and India signed such a 123 Agreement in 2008, after India - which is not a signatory of the international Nuclear Non-proliferation Treaty - reached a safeguards agreement with the International Atomic Energy Agency. But although US-designed reactors have long been earmarked for potential construction in India - Kovvada, in Andhra Pradesh, was identified as a site for six AP1000 pressurised water reactors as long ago as 2016 - contractual arrangements remain to be finalised.

In January - in the final days of the Biden administration - National Security Advisor Jake Sullivan said the USA was getting close to removing long-standing regulations that have prevented civil nuclear cooperation between Indian nuclear entities and US companies. Since then, the Indian government has announced that it will amend both its Atomic Energy Act, which had precluded private-sector investment in India's civil nuclear industry, and the Civil Liability for Nuclear Damage Act, which has been a stumbling block for overseas nuclear power plant vendors as it gave plant operators unlimited legal recourse to the reactor supplier in the event of a nuclear accident.

President Trump and Prime Minister Modi said they welcomed the recent announcement of the amendments and "further decided to establish bilateral arrangements in accordance with CLNDA, that would address the issue of civil liability and facilitate the collaboration of Indian and US industry in the production and deployment of nuclear reactors. This path forward will unlock plans to build large US-designed reactors and enable collaboration to develop, deploy and scale up nuclear power generation with advanced small modular reactors".

They also announced a raft of technology and innovation initiatives, including the US-India TRUST (Transforming the Relationship Utilising Strategic Technology) initiative to catalyse collaboration to promote the application of critical and emerging technologies in areas including defence, artificial intelligence, semiconductors, quantum, biotechnology, energy and space, "while encouraging the use of verified technology vendors and ensuring sensitive technologies are protected".

MAGA-MIGA-MEGA
 

Modi also coined a new phrase to describe India's development vision as the two leaders addressed the media following their meeting in the Oval Office.

"Americans are familiar with President Trump's motto, Make America Great Again, or 'MAGA'," Modi said. "The people of India are also moving towards development at a fast pace with the determination of 'Viksit Bharat 2047' on the track of heritage and development.

"If I say in the language of America, developed India means Make India Great Again, ie "MIGA". When the United States and India work together, ie 'MAGA' plus 'MIGA', the 'MEGA' Partnership for prosperity is formed. And this mega spirit gives new scale and scope to our goals."

Modi's words were reported by the Press Trust of India.

India aims to develop at least 100 GW of nuclear energy by 2047 for its energy transition efforts and has committed to partner with the private sector on the development of the Bharat Small Modular Reactor, a compact 220 MW pressurised heavy water reactor based on India's reactor technology.

Earlier in the week, Modi and French President Emmanuel Macron agreed a Declaration of Intent for establishing a partnership on advanced modular reactors and small modular reactors.

Collaboration key to clean energy dream, India Energy Week hears

Friday, 14 February 2025

Nuclear will play a crucial part in ensuring reliable supplies of clean energy - and collaboration will be the key to make it happen, according to panelists at the Indian government's flagship energy event.

The panel at IEW 2025

India Energy Week 2025, which took place in New Delhi from 11-14 February under the patronage of India's Ministry of Petroleum and Natural Gas, and was organised by the Federation of Indian Petroleum Industry, attracted more than 70,000 delegates from 50-plus countries, including more than 20 ministers. According to the host ministry, it is now the world’s second-largest energy event.

At the inaugural session - which included an address by Prime Minister Narendra Modi - India's Minister of Petroleum and Natural Gas Hardeep Singh Puri called for a balanced and inclusive energy transition that must also be "pragmatic" with a continued role for hydrocarbons alongside other energy options and must not deepen inequality by leaving developing economies behind in the transition.

Nuclear featured in India Energy Week, with a panel discussion on "Realising nuclear power’s low-carbon renaissance and future role in the clean energy mix", with panellists from World Nuclear Association, the South African Nuclear Energy Corporation (Necsa), India's NITI Aayog public policy think-tank, and the nuclear wing of Indian state-owned National Thermal Power Corporation Ltd (NTPC). The panel was moderated by the International Energy Agency's Nobuo Tanaka.

World Nuclear Association Director General Sama Bilbao y León stressed the importance of energy independence and also energy equity, with at least 100 million of the world's inhabitants lacking access to the energy they need. "We are seeing very serious interest in nuclear energy everywhere in the world," she said. "In the last two, three years we’ve seen many countries have recognised it is simply not possible to reach their goals in a sustainable, cost effective, timely and, very importantly, equitable manner, without nuclear energy."

The issue of equitable access to energy was also highlighted by Loyiso Tyabashe, Group CEO of Necsa. "The main thing that bugs us about energy is energy access - before you talk about whether it’s cheap or carbon free. So nuclear does play a very important role in ensuring that ultimate objective for the continent - it provides energy security, available 24 hours a day."

The panel session was reported by Energy Connects.

Building the supply chain

Days before India Energy Week, India's Minister of Finance Nirmala Sitharaman, in the 2025 Union Budget, said India will need to build at least 100 GW of nuclear capacity by 2047 to support its energy transition, and intends to make the necessary changes in law to clear the way for participation by private sector and overseas companies.

Speaking on the sidelines of the event, Bilbao y Léon said India had a "thriving" nuclear industry, but a secure supply chain will be necessary to underpin growth in India, and elsewhere.

"The goal of having 100 gigawatts of nuclear energy by 2047, it's a big challenge," she told CNBC. For projects in India, she said, realigning the Nuclear Energy Act and India's nuclear liability laws to incentivise public-private partnerships, bring in overseas investors and international companies "will be very important to help India accelerate their use of nuclear".

"So what we are doing right now in World Nuclear Association, together with all our members throughout the entire value chain in nuclear, we are actually trying to enhance how we invest in our infrastructure. This means industrial infrastructure, supply chain, manufacturing, but also workforce infrastructure. So we are trying to attract, retain, prepare, and educate and develop the brightest people to come to the nuclear industry.

Newcleo seeks to buy land for demonstration SMR

Friday, 14 February 2025

Innovative reactor developer Newcleo announced it has started the land acquisition process for its demonstration LFR-AS-30 small modular reactor in Indre-et-Loire in the Chinon Vienne et Loire community of municipalities in western France.

A rendering of the LFR AS-30 (Image: Newcleo)

The company has "formally initiated constructive discussions and procedures" with the Chinon Vienne et Loire community of municipalities on the siting of the reactor. "Preliminary meetings with local officials, the Chinon Vienne et Loire community of municipalities, and state authorities have allowed Newcleo to present its project while reaffirming its commitment to maintaining a constructive dialogue with all local stakeholders," it said.

"This approach, which follows the standard process for large-scale projects in France, will be accompanied by a series of preliminary studies required for administrative authorisations and subsequent decisions," Newcleo said. "The entire process is conducted in full compliance with the highest applicable regulations and standards, in close collaboration with the relevant authorities."

The company said it will soon refer the matter to the National Commission for Public Debate, in accordance with the Environmental Code. Its project will then be presented during the upcoming public debate, providing a clear overview of its ambitions and commitments. The debate allows interested parties to participate in shaping major policies or projects with significant socio-economic or environmental impact, ensuring transparent and inclusive decision-making from the outset.

According to Paris-headquartered Newcleo's delivery roadmap, the first non-nuclear pre-cursor prototype of its reactor is expected to be ready by 2026 in Italy, the first reactor operational in France by the end of 2031, while the final investment decision for the first commercial power plant is expected around 2029.

Newcleo said its first-of-a-kind 30 MWe lead-cooled fast reactor will "serve as an industrial demonstrator, a showcase for Newcleo's technology, and contribute to the development of the nuclear sector in France".

Last month, Newcleo signed framework agreements with Slovakian companies JAVYS and VUJE which could lead to up to four of its 200 MWe lead-cooled fast reactors at the Bohunice site.

Studies continue into SMR deployment in Lund

Friday, 14 February 2025

A new company is being established to further investigate the possibility of establishing a nuclear power plant based on small modular reactors in the municipality of Lund in the southern Norwegian county of Rogaland.

Lund (Image: Yeezus903 - Wikipedia)

In July last year, Norwegian nuclear project developer Norsk Kjernekraft - which aims to build, own and operate small modular reactor (SMR) power plants in Norway in collaboration with power-intensive industry - signed a cooperation agreement with Lund to consider the construction of such a plant in the area. Since then, thorough preliminary studies have been carried out, which show that the area has several suitable locations where a plant could be built.

The new company - named Dalane Kjernekraft AS - is being established in a partnership between Lund Municipality, Dalane Energi and Norsk Kjernekraft.

The company will operate according to the same model as Halden Kjernekraft AS. That company - founded by Norsk Kjernekraft, Østfold Energi and the municipality of Halden - is investigating the construction of a nuclear power plant based on SMRs at Halden, where a research reactor once operated.

Dalane Kjernekraft will initially continue its investigations and then select a location for an impact assessment. If the impact assessment yields positive results and shows that the benefits outweigh the disadvantages, the next step will be to prepare a licence application that can provide the basis for a possible start of construction. "If the studies yield a positive outcome, an SMR could be ready for operation around the mid-2030s," Norsk Kjernekraft said.

"The Dalane region needs more clean energy to succeed with development and restructuring," said Lund's mayor Gro Helleland. "A nuclear power plant in Lund will benefit the entire region in terms of attractiveness and increased activity for both business and local communities. Consideration of natural intervention has been crucial in our choice of energy solution. A nuclear power plant can produce as much energy as Norway's largest wind farm at Fosen, but only requires an area equivalent to a football stadium. We believe the time is ripe for an open and fact-based investigation, in which Lund's residents should be closely involved in the process."

"Lund Municipality is leading the way as a good example of how Norway can meet both climate goals and nature conservation at the same time," said Norsk Kjernekraft CEO Jonny Hesthammer. "So far, we have been in dialogue with nearly 90 Norwegian municipalities, but Lund Municipality is one of the fastest and is well ahead in the queue to become a host municipality for an SMR.

"Globally, a nuclear power renaissance is now taking place, and never before has interest in this been greater in Norway. Through Dalane Kjernekraft, Lund can show Norway how municipalities can be strengthened through real sustainability in practice."

In June 2024, the Norwegian government appointed a committee to conduct a broad review and assessment of various aspects of a possible future establishment of nuclear power in the country. It must deliver its report by 1 April 2026.

Britain's Energy Future Hinges on Small Modular Reactors

By City A.M - Feb 12, 2025

Britain's energy costs are among the highest globally, and nuclear power offers a potential solution for economic improvement, energy independence, and national security.

Small modular reactors (SMRs) could provide a significant portion of the UK's energy needs at a competitive price, with a substantial return on investment despite high upfront costs.

Nuclear energy, especially from SMRs, is essential for Britain to meet its Net-Zero targets and transition away from fossil fuels, making it a crucial part of a sustainable energy future.



While France generates most of its energy from nuclear, Britain has the highest industrial electricity costs in the world. The upfront costs of small modular reactors are high, but so is the return on investment, says John Caudwell

Last month was the hottest January on record globally. It was unexpected because the natural weather phenomena known as ‘La Niña’ should have produced a cooling effect. That suggests that La Niña might be losing its ability to keep global warming in check – a terrifying reminder of the escalating climate crisis.

Countries around the world stand at a crossroads in deciding how to deal with this challenge. They can choose to create meaningful, sustainable jobs in the clean tech sector and, by doing so, stimulate economic growth and help protect our planet. Or they can choose to opt out of this race and watch others reap the rewards as they build the green infrastructure and technology of the future.

Last week, the government gave us further evidence that it is choosing the former. The prime minister is standing up for Britain’s future by pledging to reform the UK’s planning rules to make it easier to build nuclear power plants. These reforms will also make it easier to build small modular reactors (SMRs). This is good news and should be welcomed as a decision long overdue.

In 2010, the then Leader of the Liberal Democrats and soon-to-be Deputy Prime Minister Nick Clegg dismissed the tremendous opportunities offered by nuclear power because its benefits would not be apparent until 2022. Well, in 2025, such thinking appears very short sighted.

In the middle of the 20th century, Britain was the world leader in nuclear power. In fact, in 1965, the UK had more nuclear reactors than the rest of the world combined. But Britain’s nuclear engineering expertise has since disappeared as our nuclear industry atrophied, in part through our reliance on gas.

And now in Britain we look over the Channel in envy at France, who – for decades – have generated most of their energy, many times the world average, from nuclear power.

It’s because of our short-term approach that Britain now has an energy problem. We have one of the highest domestic electricity costs in Europe, and we have the highest industrial electricity cost in the world.

Nuclear would be good for the economy, energy independence and national security

There are many parts to solving this problem, such as regional energy pricing, but nuclear power also has to play a key role. That would not just be good for the economy and our energy independence and national security, it would bring electricity costs down and help tackle climate change.

Electricity from an SMR could be generated at just 5p per kilowatt hour (kWh).

Of course, there’s a substantial upfront cost. Britain will need thousands of SMRs – in addition to larger nuclear plants such as Hinkley Point C and Sizewell C, where economies of scale are greater still – and, if the build cost is roughly £500bn to provide 50 per cent of the UK needs, the total price is huge.

But so is the return on investment. At current electricity prices, I think the initial investment could be covered in two years.

Savvy investors should happily stump up the short-term costs to, in the Prime Minister’s words, “build, baby, build” and seize the long-term opportunity this offers

Savvy investors should happily stump up the short-term costs to, in the Prime Minister’s words, “build, baby, build” and seize the long-term opportunity this offers.

The UK could become a world leader in nuclear power – and SMRs are a crucial part of that vision. We should not pretend that nuclear power is a panacea for all our energy woes, but they do have a central role to play in boosting our energy independence and resilience.

Environmentalists should welcome this too. If the UK is ever to wean ourselves off fossil fuels and meet our Net-Zero targets, then safe, clean nuclear energy – particularly from SMRs – is essential. And we need it faster than ever.

By City AM

Failed Nuclear Deal Negotiations Push Iran Closer to Economic Collapse

By RFE/RL staff - Feb 12, 2025

Iran's economy is facing severe challenges, with the national currency plummeting to a record low due to US sanctions and stalled nuclear negotiations.

Supreme Leader Ayatollah Ali Khamenei's changing stance on negotiating with the US has led to public frustration and criticism, with many Iranians expressing anger on social media.

The economic hardship in Iran is causing widespread poverty and social unrest, with concerns that an "angry and hungry society" could take to the streets in protest.




Public outrage is mounting in Iran as the country's struggling economy worsens under crippling U.S. sanctions.

The national currency plunged to a record low on February 11 soon after U.S. President Donald Trump ordered the restart of a "maximum pressure" campaign on the Islamic republic.

In response, Supreme Leader Ayatollah Ali Khamenei appeared to dismiss the prospect of negotiations with the United States over Iran's disputed nuclear program.

A nuclear deal is seen as key to Washington lifting economic sanctions on Iran, which has witnessed rising unemployment and growing poverty in recent years.

Quick Turnabout

For months, Iranian officials have signaled the country was open to negotiating with Trump.

That is despite Trump withdrawing the United States from a nuclear deal between Tehran and world powers and reimposing sanctions during his first term in office. In response, Tehran significantly expanded its nuclear program, though it maintains it is not looking to weaponize it.

Khamenei on January 28 appeared to give his blessing to talks with Trump, saying it's "possible to make a deal" with someone you know and can prepare for.

But the Iranian leader changed tack on February 7, saying it would "not be intelligent, wise, or honorable" to negotiate with Washington because it cannot be trusted.

"A portion of society pinned their hopes" on reformist President Masud Pezeshkian, who was elected in 2024, said Saeed Peyvandi, a professor of sociology at Paris 13 University.

"Now they will see their lives getting worse," Peyvandi told RFE/RL's Radio Farda. "This will make the prospects of change in the [Islamic republic] impossible in the eyes of the people…. An angry and hungry society can take to the streets at any moment."

There have been violent protests in recent years over Iran's freefalling economy.

Frustration And Criticism

Khamenei's apparent rejection of negotiations with the United States has led to an outpouring of frustration and criticism on social media.

Some Iranians on X asked why an "unelected, lifelong official" gets to decide what is best for an entire nation.

Others called on Pezeshkian to resign if he was unable to deliver on his campaign pledge to ease tensions with the West.

Khamenei's comments as well as Trump's decision to resume a "maximum pressure" campaign on Iran appeared to trigger the sudden drop of the value of the rial against the U.S. dollar.

The falling value of the rial in recent years has exacerbated the cost of living in Iran. A recent report by Iran's statistical authority said that around a third of Iranians earn less than $2 a day and struggle to afford basic necessities.

Economy journalist Zohreh Irani pointed to the depreciation of the rial and declared, "You will negotiate, I promise you."

Joking about the speed with which the rial is falling, Iranian poet Morteza Lotfi wrote on X, "We worked 9 hours today but we're poorer than the morning!"


Ata Mohamed Tabriz, a political analyst based in Turkey, told Radio Farda that Iranians have expressed "serious anger" since Khamenei's comments.

"There is a chance the anger will grow…. But it doesn't look like the Islamic republic is going to do anything about it," he added.

By RFE/RL

Russian Oil Tanker Fleet Severely Hobbled by Last Month’s US Sanctions

By Bloomberg News

February 13, 2025

(Vessel tracking data compiled by)

(Bloomberg) -- The latest US sanctions on Russia’s oil trade have brought a swath of tankers that deliver Moscow’s crude to a halt — reinforcing the significance of the measures in any negotiations over ending the war in Ukraine.

About 60% — 94 out 154 — of the active tankers blacklisted by the outgoing Biden administration last month for their involvement in the Russian oil trade have stopped hauling barrels for Moscow or anyone else, ship-tracking data compiled by Bloomberg show. Another seven were under construction or undergoing sea trials.

On Wednesday, US President Donald Trump said he’d spoken to Vladimir Putin about ending the war in Ukraine. The discussions touched on energy but, according to Kremlin spokesman Dmitry Peskov, not sanctions.

However, the Jan. 10 measures are forcing Russia to rewire its oil supply chain to find alternative ships — and pay high freight costs for them. It’s also delivering cargoes in unusual ways. At stake is the country’s capacity to keep supplying increasingly cautious customers and, ultimately, Russia’s own production of hydrocarbons.

While there’s no sign yet that output is being hurt by the measures, Russia’s tanker fleet clearly is being disrupted. Around half of the idled vessels observed by Bloomberg became inactive as soon as they were blacklisted.


To be clear, it’s too soon to say what will happen to the remaining tankers that were sanctioned on Jan. 10 and are still operating for now. If history is any guide some will also be forced to stop trading.

Of 44 that have taken on cargoes since being blacklisted, 20 are operating solely within Russia. Another nine are specialized shuttle ships used by two projects on Sakhalin Island in Russia’s Far East, most of which are struggling to offload their consignments.

However, some buyers and buyer countries have balked at dealing with sanctioned shipments in the wake of the US Treasury’s measures.

The Indian government has said it won’t allow sanctioned ships to dock at its ports after Feb. 27 and before then only if they are carrying cargoes loaded prior to Jan. 10. Many ports in China’s Shandong province, a hub for independent refiners, are wary of handling sanctioned tankers after a warning from a major terminal operator. Likewise, the biggest refiner in Turkey, Russia’s other major customer, is also restricting purchases to avoid falling foul of US sanctions.

The reluctance of Moscow’s biggest buyers to accept vessels sanctioned by Washington is starting to cause logistics headaches for exporters.

Emerging Clusters

While the idled ships are dotted across the globe, there are places where some have clustered.

Those locations include Ust-Luga in the Baltic Sea, the Black Sea — although most disappear from automated tracking systems on entering that body of water — and the Sea of Marmara. In Asia, groups of vessels are anchored near the Russian port of Kozmino and China’s Zhoushan.

More have gathered in the Riau archipelago, east of Singapore, which is better known in the market for the clandestine transfer of Iranian cargoes.

About 2 million barrels of Sokol crude from the Sakhalin 1 project have been transferred onto a very large crude carrier for onward shipment to China from specialized shuttle tankers that were blacklisted. Two more shuttle ships are idling near China with cargoes on board.

The Sakhalin 2 project is also experiencing delays in offloading cargoes. All three of the shuttle tankers it normally uses are idling, while a fourth pulled in to carry its oil has come to a near halt in the Sea of Japan.


Elsewhere, only crude from the Arctic port of Murmansk is still being exported on sanctioned tankers in any significant quantity. That oil is already hauled to the port and stored there on blacklisted vessels.

The first of the ships carrying Arctic crude from Murmansk are still at least a week away from their destinations.

Several previously identified as heading to India are now signaling North China or possible storage locations off Oman.

©2025 Bloomberg L.P.

IEA Sees Rising OIL Supply as Russia Dodges Sanctions Once Again

By Julianne Geiger - Feb 13, 2025

Russia has increased oil production despite facing Western sanctions, highlighting the effectiveness of its workarounds to circumvent restrictions.

The IEA has revised its forecasts, acknowledging Russia's ability to maintain oil output despite sanctions.

The global oil market faces uncertainty, with rising supply, potential plateauing of Chinese demand, and the ongoing impact of the Ukraine conflict.



If you thought Russia’s oil industry would finally take a hit from Washington’s latest round of sanctions, think again. According to the International Energy Agency (IEA), Moscow is already crafting new workarounds, keeping its oil flowing despite restrictions that were supposed to tighten the screws. The IEA, which has had to revise its Russian supply forecasts more times than it cares to admit, now says the country’s crude output actually rose by 100,000 barrels per day (bpd) in January, hitting 9.2 million bpd.

Sanctions, it turns out, are just another puzzle for Moscow to solve. This time, Russia is hunting for smaller tankers to supplement its so-called shadow fleet, ensuring its crude keeps moving—mostly to India and China, which have happily stepped in to buy discounted barrels. And the IEA is already hedging its bets, admitting that “workarounds may well appear in the coming weeks.”

They know Russia will find a way.

Meanwhile, the broader oil market is dealing with its own surprises. The IEA nudged up its 2025 global oil demand forecast by 50,000 bpd to 1.1 million bpd, but supply is still expected to outpace demand, thanks to a surge in production from the Americas. Even if OPEC+ keeps its production cuts in place, global supply is set to rise by 1.6 million bpd this year—a number that doesn’t exactly scream tight markets.

Then there’s China, long the engine of oil demand growth. The IEA now believes China’s fuel consumption may have peaked, with gasoline, jet fuel, and diesel demand barely above 2019 levels. If true, that’s a significant shift. The big wildcard? Petrochemicals, which could still keep China’s crude intake steady—but the days of roaring Chinese fuel demand might be numbered.

Despite all this, oil prices are a rollercoaster. Brent spiked over $82 a barrel in mid-January, only to slide back to the mid-$70s on talk of a possible Russia-Ukraine peace deal and fears of an economic slowdown.

So, where does that leave us? Russia keeps dodging sanctions, oil supply keeps growing, and China’s demand might be plateauing.

By Julianne Geiger for Oilprice.com

Australia Could Become U.S. Ally In Battle For Critical Minerals With China

By Alex Kimani - Feb 13, 2025

For decades, Australia has been the upstream mineral supplier, whereas China has dominated the refining and processing of minerals for the global market.

The U.S. and the West have been struggling to lower their reliance on China for critical minerals.

The Biden administration promised to designate Australia as a ‘domestic source’ of minerals under the Defense Production Act.



President Donald Trump’s wish list for acquiring new U.S. territories has one thing in common: regions with abundant supplies of critical minerals. Trump has repeatedly threatened to acquire Greenland, a mineral-rich Danish territory. Canadian Prime Minister Justin Trudeau has warned that Trump’s threat to make Canada the 51st state should be taken seriously, noting Trump is interested in Canadian minerals.

Meanwhile, the U.S. president has suggested a minerals-for-aid “deal” with Ukraine, drawing pushback from Russia. It, therefore, came as little surprise that a call between Trump and Australian Prime Minister Anthony Albanese earlier this week wherein they discussed trade issues quickly sparked the concern of China, a key importer of Australian minerals as well as a leading supplier of critical minerals to the U.S. Australia is a vital source of natural resources for China, providing 60 per cent of the country’s iron ore imports.

For decades, Australia has been the upstream mineral supplier, whereas China has dominated the refining and processing of minerals for the global market. China has consistently been the largest buyer of Australian raw minerals, with Chinese investors like Tianqi and Ganfeng providing long-term capital to support and expand mining capacity in Australia. Australia is a major supplier of minerals used to make batteries for electric vehicles, with China’s Tianqi Lithium holding a large stake in the lithium hydroxide plant in Kwinana, Perth. In this context, Australia depends on China while Chinese processors also depend significantly on Australia.

On the other hand, the U.S. and the West have been struggling to lower their reliance on China for critical minerals. The Inflation Reduction Act (IRA) of 2022 took bold steps towards promoting U.S. production of critical minerals, with a dual-pronged goal of supporting a rapid energy transition and lessening U.S. reliance on China and Russia, two countries the U.S. Department of Energy has tagged “foreign entity of concern” (FEOC). According to the United States Geological Survey, China accounts for 70% of global rare earth mining and 90% of refined output.

Unfortunately, decoupling from China’s sprawling renewable energy sector is proving to be easier said than done with the country tightening its grip on the industry. The Middle Kingdom has been using its overwhelming dominance in rare earth elements (REE’s) and critical clean energy minerals to kick out Western competitors and protect its market share. Chinese producers have been flooding the markets with REE and battery metals like lithium, leading to big price crashes and making it untenable for competitors to continue operations. Since last year, lithium is down by more than 80 percent, while nickel and cobalt have both tumbled over 40 percent.

In response, miners from Australia to Canada have been forced to cut production, pull back on investment plans and initiate layoffs. Even larger producers such as Las Vegas, Nevada-based rare earths miner MP Materials (NYSE:MP) and its Australian peer Lynas Rare Earths (OTCPK:LYSCF) (OTCPK:LYSDY) are barely hanging on, and their shares have crashed.

Beijing is doing everything in its power to thwart attempts by Western governments at independence. Since 2006, Beijing has controlled its supply of rare earths through the quota system. In 2023, China issued three batches of rare earth output quotas, the first time it issued three quotas in a single year since it started the quota system. The total quota for 2023 clocked in at a record high of 255,000 tons, good for a scorching 21.4% Y/Y increase. Beijing has also significantly tightened rules guiding exports of several critical metals and minerals, including a ban on the export of technology to make rare earth magnets, escalating an earlier ban on export of technology to extract and separate critical materials. China's commerce ministry sought public opinion on a potential ban on export of technology to prepare neodymium-iron-boron magnets, samarium-cobalt magnets and cerium magnets ostensibly to protect national security and public interest.

"China is driven to maintain its market dominance. This is now a race," Don Swartz, CEO of American Rare Earths (ARR.AX), told Reuters.

The intensifying US–China geopolitical rivalry spilled over into the critical minerals realm years ago, creating the so-called ‘security-sustainability nexus’ – the linkage between state security concerns and the transition to green energy.


Australia Leans to Western Allies

That said, the move to forge stronger alliances on critical minerals supply chains between the U.S. and Australia actually kicked off in earnest during the Biden presidency. The era when Australia declared that Canberra ‘can maintain a close strategic alliance with the U.S. while also enhancing its friendship with China’ is now gone. By joining the AUKUS (Australia–UK–US) security pact in September 2021, with an unmistakable anti-China alignment, Australia gave up on maintaining a balance between its cooperation with China and its alliance with the U.S. According to former Australian Prime Minister Paul Keating, ‘we [Australia] are now part of a [US] containment policy against China’.

As the U.S. targets China’s involvement in Australian critical minerals as a part of its strategy to de-risk its supply chains from China’s dominance, it has extended the application of its subsidies to ‘friendly’ and ‘like-minded’ countries, among which Australia has emerged as a critical country of interest. The Biden administration promised to designate Australia as a ‘domestic source’ of minerals under the Defense Production Act, allowing Australia to benefit from the $369 billion IRA clean energy incentive.

It will be interesting to see how the Trump administration will work with Australia to strengthen America’s critical mineral supply chains. Trump has repeatedly lambasted the IRA, describing it as the “biggest tax hike in history”. Trump pledged to rescind any “unspent” funds under the IRA should he ascend to the Oval Office again. “To further defeat inflation, my plan will terminate the Green New Deal, which I call the Green New Scam,” the former president said before the Economic Club of New York in September.

In the same breath, one of Trump's many "Unleashing American Energy" directives requires the Secretary of the Interior to instruct the director of the USGS to "consider updating the survey's list of critical minerals, including for the potential of including uranium." It’s, therefore, likely that the GOP-controlled Congress will not repeal parts of the IRA that support critical minerals, meaning that Australia is likely to become a key supplier of critical minerals to the U.S. in the coming years.


By Alex Kimani for Oilprice.com

Trump Reverses Biden's Environmental Policies With Assessment Freeze

By Felicity Bradstock - Feb 13, 2025,

President Trump signed an executive order to halt the progress of the National Nature Assessment, a project initiated by the Biden administration to evaluate and report on the status of America's natural resources.

Experts involved in creating the National Nature Assessment are exploring options to independently complete and publish the report due to its importance for environmental and economic planning.

The halt of the National Nature Assessment is part of a broader pattern of the Trump administration reversing environmental policies and climate change efforts of the previous administration.



A far-reaching nature assessment that was approved by the Biden administration in 2022 has been halted by President Donald Trump just weeks before its completion. This follows recent decisions by Trump to take the United States out of the Paris climate agreement and halt climate spending, as well as to limit the powers of the U.S. Environmental Protection Agency (EPA). It is so far uncertain whether the assessment will go ahead and what impact this may have on environmental protection and climate progress.

In 2022, the U.S. Office of Science and Technology Policy (OSTP) requested permission from the Biden administration to develop the first National Nature Assessment (NNA) on behalf of the United States Global Change Research Program (USGCRP). The aim of the NNA was to assess the status, observed trends, and future projections of America's lands, waters, wildlife, biodiversity and ecosystems and the benefits they provide, including connections to the economy, public health, equity, climate mitigation and adaptation, and national security.

Former President Joe Biden wrote in the federal register in favour of the development of the NNA. He explained that “existing reports and assessments provide partial views of changes in nature and how they affect the nation, but the United States lacks comprehensive knowledge on these major aspects of global change.”

In 2023, The Interior Department encouraged the public to participate in the NNA. Around 150 authors were engaged to work on the report and the team sought Tribal consultation and public input. At the time, the director of the assessment, Philip Levin, stated, “It is an assessment that is not just a compilation of data and trends, but it’s really focused on what are the needs of the people.”

“The NNA will take a critical look at who is—and who isn’t—benefiting from nature or suffering the consequences of nature loss. Importantly, the NNA will also identify opportunities for nature to help us achieve our societal and economic goals,” Levin wrote on Earth Day in 2024. “The NNA will serve as a vital tool for governments, businesses, communities, and leaders across sectors… [it] will help leaders make decisions about how to safeguard nature, and how to work with nature to meet our nation’s aspirations for a stable climate, robust health, and plentiful opportunity for every person,” he added.

However, the completion of the NNA is now under threat, as President Trump has halted all work on the assessment. The first full draft of the NNA was due for completion on 11th February when Trump decided to sign an executive order stopping work on the project. This was one of several moves made by Trump during his first week as president to roll back the work done by the Biden administration in support of the environment. President Trump also froze climate spending, began the process of withdrawing the U.S. from the 2015 Paris Agreement, announced plans to expand fossil fuel production, and targeted wind and solar power. Since the signing of the executive order, the NNA federal web page has been removed.

Philip Levin was told to inform his team that work on the project must be discontinued. However, he also emailed them, from his personal account, saying, “This work is too important to die… The country needs what we are producing.” This move has encouraged experts working on the report to explore potential ways to complete and publish the NNA outside of the government.

Howard Frumkin, a professor emeritus of environmental science at the University of Washington School of Public Health who was helping develop the report said, “There’s an amazingly unanimous broad consensus that we ought to carry on with the work.”

The White House has so far not publicly spoken about its decision to axe the report. However, a White House spokesperson, Anna Kelly, said that Trump planned to “unleash America’s energy potential” and “simultaneously ensure that our nation’s land and water can be enjoyed for generations to come.”

While there are high hopes for the publication of the assessment, it means that federal employees will no longer be able to contribute to the work. This means the team must find alternative funding for the completion of the report, as well as ensure it garners similar attention as it would have with government backing. However, ownership of the report should not be an issue, according to lawyers, as government works are not generally subject to copyright.


The cancellation of the NNA, following years of work by hundreds of participants, is just one of many moves President Trump has taken to backtrack on the environmental and climate work of the Biden administration. Trump has been clear on his intentions to expand oil and gas production while rolling back climate efforts in a bid to enhance the U.S. economy, but it is unclear what this means for the future of the NNA and several other environmental projects.

By Felicity Bradstock for Oilprice.com

Pushback Begins Against Trump’s Oil Agenda

By Irina Slav - Feb 08, 2025

West Texas Intermediate has been trading around $70 this week after posting two weeks of declines.

The last time shale producers pursued a flat-out production strategy, crude prices tanked to the $40s.

Cheap oil may turn out to be one promise Trump can’t keep—because it’s not entirely up to him.


President Trump declared a national energy emergency as soon as he took office. The declaration had the goal of facilitating growth in energy supply or, as Trump likes to call it “Drill, baby, drill.” Yet this time, Baby doesn’t feel much like drilling. And it’s saying this loud and clear.

The oil and gas industry celebrated Trump’s victory in the November elections. After four years with a not-so-friendly federal government, a pro-oil White House was certainly a welcome change. But then Trump said he wanted more oil and gas to flow along the pipelines. And producers said the same that OPEC tends to say when called upon to boost production: only if the price is right!

The price, right now, is not right.

This tends to get ignored by a lot of industry observers who trade oil. The thinking goes that if Trump is in the White House, then the oil and gas industry players have the biggest ally in the country, which means they can do whatever they want and pump as much crude as they want. This is actually correct.

Yet these players see no benefit in pumping more crude at the moment.

West Texas Intermediate has been trading around $70 this week after posting two weeks of declines following a strong start to the year with Trump’s inauguration and expectations of “maximum pressure” on Iran. Shortly after, the “Drill baby, drill” assumption began to unravel. Drillers signaled they had no intention of stepping up work to boost production. In fact, the latest data about 2024 recently showed that growth in U.S. oil production had slowed down significantly to 300,000 bpd last year.

In the year prior, the growth rate was three times that.

It’s all about the price, of course. It’s always about the price. This goes for OPEC and U.S. shale drillers alike. “What you are seeing is a huge amount of positivity,” the president of Liberty Energy told the New York Times in late January, commenting on Trump’s entry into office. “But it’s too early to say that that’s going to translate into a change in actual activity levels here in North America,” Ron Gusek told the NYT.

Related: Canadians Overwhelmingly Support Retaliatory Oil Tariffs In Trump Trade War

The NYT story said that oil and gas executives were in zero rush to drill just because the President had asked them to. A recent story in the Wall Street Journal said the same thing, citing unnamed industry sources. Essentially, everyone is quoting the energy industry as saying it will not drill more. Axios also recently cited estimates by the Energy Information Administration that expected production across most regions to decline over the next two years, with only the Permian seeing significant growth and coming to account for over half of the U.S. total.


This puts Trump in a bind because he aims for more than one thing with his calls for lower oil prices. First, of course, there is retail fuel prices, overall inflation, and eventually, interest rates. Trump understandably wants all of these to fall. Yet his other stated goal is to boost global crude oil supply and tank prices as a way of pressuring Russia to sit at the negotiations table about Ukraine.

Over the past decade, Russia has demonstrated that it is perfectly capable of surviving whatever oil prices international trade dynamics throw its way, but Trump has insisted that lower oil prices will force it to negotiate peace with Zelensky. His special envoy to Russia and Ukraine has an exact price in mind: $45 per barrel. Unfortunately, that price—while certain to cause Russia economic pain—will also cause pain to U.S. shale drillers—and a greater one.

As the Wall Street Journal recalls, the last time prices sank to $45 per barrel, a short oil war ensued between Russia and Saudi Arabia, from which both survived, But this was not the case for many U.S. shale producers. Shale, while making huge strides towards drilling efficiency and cost cuts over the last couple of decades, remains highly sensitive to global prices because its production costs are still generally higher than those for conventional production—and now natural depletion is kicking in as well.

This is one more reason U.S. oil and gas producers are in no rush to do the President’s bidding. There may still be hundreds of millions of untapped crude in the shale patch, but drillers are going to tap it in a measured way rather than the initial burst of activity that saw so many go under when debt burdens became unsustainable. This led to that strict financial discipline everyone’s been praising for years now, and that has become the new normal in shale.

With that discipline, and with the Saudis firmly on their own price control path, cheap oil may turn out to be one promise Trump can’t keep—because it’s not entirely up to him.


By Irina Slav for Oilprice.com

IT'S ALL BLUE

What Happened to the Green Hydrogen Boom?

By Haley Zaremba - Feb 12, 2025

Hydrogen fuel cell technology is facing significant implementation challenges, with less than 10% of planned green hydrogen projects being realized on schedule.

Battery electric vehicles are proving to be more efficient and cost-effective than hydrogen fuel cells in personal transport, with substantially higher sales figures.

Experts are expressing doubts about hydrogen's viability in various transportation sectors, including aviation, citing cost, storage, and technological challenges.



This week, 37 hydrogen-powered buses were delivered to Bologna, Italy, marking the first phase of a large-scale order placed by the transport operator TPER. At the tail end of 2023, TPER ordered 137 hydrogen buses to be deployed in Bologna and nearby Ferrara as part of a broader effort to decrease greenhouse gas emissions. The project was co-funded by TPER and through European Union funds from the bloc’s post-pandemic recovery plan.

"The delivery of the first hydrogen buses to Bologna represents a significant milestone in the advancement of sustainable public transport. The Urbino 12 hydrogen buses will help improve air quality, enhancing the well-being of residents in the city and the region," said Javier Iriarte, CEO of Solaris Bus & Coach, the firm that manufactured the hydrogen buses.

But while Solaris and TPER are celebrating what they are heralding as the dawn of a new hydrogen era, other experts are saying that these baby steps forward for the hydrogen-powered transport industry are far too little, too late. “In the first half of 2024, the global market for hydrogen fuel cell cars was just 5,621 units. In the same period, 4.5 million battery electric vehicles were sold,” Forbes recently reported. “It’s clear that hydrogen isn’t winning for personal passenger transport.”

In fact, hydrogen doesn’t seem to be winning much of anything yet. Despite lofty global targets, less than a tenth of planned green hydrogen projects around the world had been implemented as of 2023. Tracking 190 projects over 3 years, a recent study identified “a wide 2023 implementation gap with only 7% of global capacity announcements finished on schedule.”

Scientists and policy-makers have long been hopeful that green hydrogen would form a key part of decarbonization strategies, particularly in hard-to-abate sectors like transport, steelmaking, and shipping. But a couple decades into this plan, it’s clear that the challenges for a switch to green hydrogen seem to still outweigh the benefits in many, if not most, target sectors.

In cars, batteries are just much more efficient and cost-effective than hydrogen. Professor David Cebon from the Centre for Sustainable Road Freight has calculated that electric vehicle batteries are three times more efficient than hydrogen fuel cells in terms of power generation to delivery.

And then there’s the issue of storing hydrogen. “If you keep it as a gas, you must compress the hydrogen to a very high level to reduce the volume sufficiently. You then must put it into a tank that can hold that high pressure system. I haven’t seen the technology that can do it at a cost structure that works,” says Mike Nakrani, CEO of VEV, a Vitol-backed firm offering scaled enterprise electric fleet solutions.

While Forbes reports that you shouldn't hold your breath for hydrogen cars or trucks, other experts are saying that hydrogen “won’t fly” for aviation, either. Noted hydrogen skeptic Michael Barnard recently noted that many early backers of hydrogen-powered aviation have quietly gone under or eliminated hydrogen from their agendas altogether as technology has not been able to counter the significant costs and challenges – including “certification challenges, the storage challenges, the airframe challenges, the balance of aircraft during flight challenges, the cost challenges, or the airport infrastructure challenges” – associated with hydrogen fuel cells.

“The economics don’t add up,” Barnard writes. “Developing new aircraft designs, overhauling airport infrastructure, and ensuring safety compliance would be extremely expensive. With more practical alternatives like sustainable aviation fuels and battery-electric aircraft emerging, hydrogen can’t compete.”

By Haley Zaremba for Oilprice.com

Uruguay's Green Energy Success Story Takes an Unexpected Turn

By Haley Zaremba 

- Feb 08, 2025

Uruguay, a leading country in renewable energy adoption with 98 percent of its energy coming from renewable resources, has announced plans to explore for offshore oil and gas reserves.

The decision to explore for oil and gas is primarily driven by economic factors, despite Uruguay being a net energy exporter and having a successful renewable energy program.

The move has generated controversy within Uruguay, with concerns raised about the environmental impact on marine life and the potential damage to Uruguay's image as a



For years, Uruguay has been extolled as a poster child for green energy ambitions. Last year, the small South American country generated a jaw-dropping 98 percent of its energy from renewable resources and proudly paved the way for a new form of energy sovereignty in a changing climate. The country of fewer that 3.5 million people has been held up as a case study for what can happen when good policy and public and political willpower come together to implement a sweeping and swift energy transition.

The primary driver of Uruguay’s energy transformation was wind power, which currently makes up a stunning 38 percent of the country’s energy mix. At present, Uruguay’s fossil fuel plants provide just 2 percent of the nation’s energy and are only rarely activated in the infrequent case that renewable power production falls short of demand.

“In less than two decades, Uruguay broke free of its dependence on oil imports and carbon emitting power generation, transitioning to renewable energy that is owned by the state but with infrastructure paid for by private investment,” Earth.org recently reported, calling the country “a model for transitioning national power systems away from fossil fuels.”

This is why it was so completely shocked when Uruguay (very quietly) announced that it would be expanding offshore exploration for fossil fuels in 2025. The Uruguayan state-owned energy company Ancap estimates that there is a 3 to 23 percent probability that oil or gas will be found in areas off the Uruguayan coast. Awareness of the possible existence of oil and gas reserves in the area was raised after a recent discovery of reserves in Namibia, located on the Western Coast of Africa.

While that may seem completely unrelated, it’s actually quite relevant, as Namibia and Uruguay used to share borders before the continental drift that broke up Pangea. This means that they also shared the prehistoric carbon-based life forms that, over the course of millions of years, turned into the oil that now runs our planet. “We have a very similar geology, very similar spaces,” Santiago Ferro Castelli, energy transition manager at Ancap, recently told the Guardian.

Now, after this realization, seven contracts have been drawn with some of the biggest names in the global oil and gas industry to begin exploration in the waters off of Uruguay.

The sudden pivot away from its sterling green reputation toward oil and gas production is highly contentious within the Uruguayan ranks. The issue is not energy security – in fact, Uruguay is a net energy exporter to neighboring Brazil and Argentina, and has been lauded for “showing the world how it’s done” when it comes to establishing successful and sovereign decarbonization on a dime. In fact, Uruguay is far more energy secure now than it was when it was a fossil fuel importing nation. Just a few decades ago, rolling blackouts were a common occurrence in Uruguay. Not so today.

Instead, the move seems to be purely economically motivated. “Despite being one of the wealthiest countries in Latin America, Uruguay, with a population of 3.4 million, faces problems with the cost of living, education and poverty,” the Guardian reports. One fifth of Uruguayan children and adolescents live in poverty.

However, the decision to explore for oil and gas reserves was not made by the Uruguayan people. “Our people have not chosen to be an extractivist country. There wasn’t the opportunity to vote,” says Andrés Milessi, a marine biologist and director of the non-governmental project Mar Azul Uruguayo. Amongst detractors, there are serious concerns about the impact that the drilling will have on local marine life.

There is also major hand-wringing about the impact that this development will have on Uruguay’s image as a green leader. Ambitious and unwavering commitment to green energy put Uruguay on the map. What will compromising that vision cost it?

By Haley Zaremba for Oilprice.com

 

China Starts Ultra-Deep Onshore Oil and Gas Drilling Campaign

By Tsvetana Paraskova - Feb 14, 2025, 

Chinese companies have launched a new ultradeep drilling campaign in the Taklimakan Desert in northwest China, hoping to unlock more oil and gas resources from deep underground.

The drilling campaign, in China’s Xinjiang Uygur Autonomous Region, aims to reach oil and gas resources that are about 8,000 meters (26,247 ft) underground.

One well, the Manshen 72-H6 in Xayar County, is planned to reach a depth of 8,735 meters (28,658 ft).

In recent years, China has intensified ultra-deep drilling, both onshore and offshore, looking to unlock more of domestic oil and gas resources to help meet its demand for hydrocarbons and reduce dependence on imports.

At the end of 2023, China Petroleum & Chemical Corporation, commonly known as Sinopec, said it achieved the first oil and gas flows from the deepest onshore well in Asia.

Other Chinese companies, including CNOOC and CNPC, are leading major drilling projects, including the Deep Sea #1 offshore field and the Shendi Take 1 well in the Tarim Basin.

China is now building a new rig that should be able to drill much deeper than any other rig—onshore.

Led by the Chinese Academy of Geological Sciences, the project involves a number of research institutions and companies. Its purpose: to develop a smart drilling rig that could reach depths of 15,000 meters, or about 50,000 feet.

“The Deep Earth National Science and Technology Megaproject is a forward-looking strategy that aligns with global scientific frontiers while ensuring national energy and resource security,” state news outlet Xinhua said, as quoted by the South China Morning Post.

A CNPC project in the Tarim Basin in Northwestern China experimented with drilling depths of up to 11,000 meters. The drilling began in 2023. Last year, after 279 days of drilling, the drill broke the 10,000-meter mark, per Chinese media reports, making the well the deepest ever drilled in the country.

By Tsvetana Paraskova for Oilprice.com

 

ADNOC Drilling to Seek $1 Billion Financing to Fund Growth

By Charles Kennedy - Feb 14, 2025

ADNOC Drilling Company, the drilling unit of Abu Dhabi’s national oil company, plans to borrow $1 billion from banks this year to refinance expiring debt, the company’s CFO Youssef Salem told Bloomberg Television in an interview on Friday.

ADNOC listed ADNOC Drilling in 2021 in what was one of the largest share sales in the United Arab Emirates (UAE) at the time. ADNOC Drilling, the largest national drilling company in the Middle East by rig fleet size, is the primary provider of drilling rig hire services and certain associated rig-related services to the ADNOC Group on agreed contractual terms.

With the IPO in 2021, ADNOC Drilling attracted international investors and capital to expand in the regional market in the Middle East.

ADNOC Drilling has a lot of work secured domestically as ADNOC, the company pumping nearly all the crude oil in the UAE, aims to expand its oil production capacity to 5 million barrels per day (bpd) by 2027. 

Now ADNOC Drilling plans to borrow money to refinance expiring debt, as it expects “to be refinancing and up-sizing to fund our growth,” Salem told Bloomberg.

The drilling company is also on the lookout for more acquisitions. It could buy in 2025 two drilling technology firms with a combined value of about $700 million, the executive said.

At the end of last year, ADNOC Drilling and Alpha Dhabi Holding PJSC said that their joint venture Enersol agreed to acquire a 95% equity stake in Deep Well Services (DWS), for approximately $223 million including performance-based payments.

DWS, through Enersol, will play a role in contributing to the development of the UAE’s conventional and unconventional energy resources. Enersol companies will support the delivery of ADNOC Drilling’s recent $1.7 billion contract award to deliver 144 unconventional wells to ADNOC Group by leveraging the various technologies available to it, ADNOC Drilling said in November.

By Charles Kennedy for Oilprice.com

MALAYSIA

Petronas Slashes Jobs to Stay in the Game

By Charles Kennedy - Feb 11, 2025

Malaysia’s state energy major Petronas needs to slash thousands of jobs to survive beyond 2035.

The headcount in administrative functions is a target for reduction.

This year, the company has a schedule for drilling 69 new development wells, up from 56 in 2024.



Malaysia’s state energy major Petronas needs to slash thousands of jobs to survive beyond 2035. The striking message came from the company’s new chief executive, who called it “right-sizing.”

“The rationale to do this is to ensure the survival of Petronas in the coming decades. If we don't do it now, there will be no Petronas in 10 years,” Tengku Muhammad Taufik Tengku Aziz told media in Kuala Lumpur, as quoted by Reuters.

Naturally, the first thought of most hearing this message would be that the company is struggling—but that would only be partially right, if Muhammad Tufik is to be believed. According to him, the root of the problem is the company's oversized administrative personnel. In fact, he made a special point of emphasizing that Petronas was in no financial trouble—quite the opposite, and that fact made the time right to “right-size”.

The job cuts would target specifically “enablers”, Muhammad Tufik said, as quoted by Malaysia’s The Edge, or administrative employees. The number of these is higher at Petronas than the industry average, and this has apparently become a threat to the long-term survival for the company. In absolute numbers, Petronas employs a global total of some 52,000 to 53,000 people, of whom some 15,000-16,000 are so-called enablers or administrative personnel.

A good question to ask would be why cut jobs at all if Petronas was doing so well. The reason, per its chief executive, is that the global operating environment was becoming increasingly challenging, and the current good times may not last—and Petronas had to prepare for the lean days.

Muhammad Tufik noted that new oil and gas project development was going to become harder because of what The Edge reported as “geological factors”. These would eat into Petronas’ revenues generated from production-sharing agreements because it would need to offer fatter shares to its partners in these projects to motivate their participation and assumption of part of the risk. Currently, Petronas takes home over 20% of the revenues under PSAs. In the future, this would shrink to the lower double digits, according to the chief executive.

Muhammad Tufik did not go into detail about the nature of these challenges that stand in the way of continued strong performance, but they might be a local reflection on global trends in oil and gas exploration, namely a shrinking poll of considerable untapped deposits. More importantly, however, the chief executive of the state Malaysian firm may be referring to the transition push that has made energy investors consider oil and gas investment much more risky than it was before in case, at some point in the near future, oil demand does indeed peak.

Indeed, one analyst said as much in comments on the news. “Growing expectations from stakeholders such as the government, ESG investors, state governments require Petronas to adopt a more sustainable and diversified approach beyond the traditional oil and gas industry,” Global Asia Consulting senior consultant Samirul Ariff Othman told Malaysia’s Business Times.

There is no indication this is going to happen anytime soon outside of transition forecasts from advocacy outlets, but the prospect of peak oil demand has certainly made a lot of energy companies nervous and spurred them into action. Over the shorter term, however, Petronas is planning to continue business as usual and even boost oil production.

This year, the company has a schedule for drilling 69 new development wells, up palpably from 56 in 2024. In addition, Petronas expects to drill about 15 exploration wells each year over the next two years. The exploration efforts will focus on shallow-water and deepwater wells. Now seems like the best time to get leaner and meaner for the future.

By Charles Kennedy for Oilprice.com

Geopolitical Risks Linger for Maritime Sector in Red Sea

By Michael Kern - Feb 13, 2025

The fragile truce between Israel and Hamas appeared to be on the verge of disintegration, raising alarms throughout the shipping world.

Hamas’s subsequent reaffirmation of its commitment to the ceasefire, including the prisoner exchange timeline, has provided a crucial reprieve for the maritime sector.

While vessel transits through the Bab el-Mandeb Strait have stabilized somewhat, traffic volume remains below pre-crisis levels, reflecting lingering unease within the shipping community.



The Red Sea, a critical artery for global commerce, is experiencing a period of cautious calm following a near-collapse of the Gaza ceasefire. While the immediate threat of renewed Houthi attacks on shipping has receded, analysts warn that the underlying geopolitical risks remain, and the maritime industry should not become complacent.

Earlier this week, the fragile truce between Israel and Hamas appeared to be on the verge of disintegration, raising alarms throughout the shipping world.

Hamas’s threat to suspend the hostage release component of the deal, citing alleged Israeli ceasefire violations, sent ripples of anxiety through the maritime shipping industry.

Adding to the tension, Houthi leader, Abdul Malik al-Houthi declared on Tuesday, "Our hands are on the trigger, and we are ready to immediately escalate against the Israeli enemy if it returns to escalation in the Gaza Strip.”

The Houthis, who have conducted over 100 attacks on Red Sea vessels since November, had explicitly linked their potential return to hostilities to the breakdown of the Gaza agreement.

This precarious situation, with the potential for renewed Houthi aggression, underscored the inherent volatility of the region and its impact on global trade. The Red Sea, a vital conduit for oil shipments and container traffic, remains highly sensitive to geopolitical shocks.

Hamas’s subsequent reaffirmation of its commitment to the ceasefire, however, including the prisoner exchange timeline, has provided a crucial reprieve. This development has significantly reduced the immediate probability of renewed Houthi aggression, offering a welcome, albeit temporary, respite for the maritime sector.

While vessel transits through the Bab el-Mandeb Strait, a key chokepoint, have stabilized somewhat, traffic volume remains below pre-crisis levels, reflecting lingering unease within the shipping community.

By Michael Kern for Oilprice.com