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From Coal To Gas: How Europe Is Easing Its Energy Crisis

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Last year, in November, the UK, together with key partner, Italy, hosted the COP26 climate summit, an event many believed to be the world’s best last chance to get runaway climate change under control.
A key outcome of the summit was that dozens of nations pledged to end deforestation, curb CO2 and methane emissions and also stop public investment in coal power.
Specifically regarding coal, a total of 46 countries signed the Global Coal to Clean Power Transitionstatement, promising to “accelerate a transition away from unabated coal power generation” and “cease issuance of new permits for new unabated coal-fired power generation projects.”
But less than a year later, all those promises have gone to the dogs, with developed countries now scrambling to resume coal-based energy generation after the Ukraine crisis triggered a global energy meltdown.
According to a report by the Observer Research Foundation, energy supply disruptions triggered by Russia’s war on Ukraine took LNG prices even higher, leaving coal as the only option for dispatchable and affordable power in much of Europe, including the tough markets of Western Europe and North America that have explicit policies to phase out coal.
According to the Washington Post, coal mines and power plants that closed 10 years ago have begun to be repaired in Germany. In what industry observers have dubbed a “spring” for Germany’s coal-fired power plants, the country is expected to burn at least 100,000 tons of coal per month by winter.
That’s a big U-turn considering that Germany’s goal had been to phase out all coal-generated electricity by 2038.
Other European countries such as Austria, Poland, the Netherlands and Greece have also started restarting coal plants.
Meanwhile, China’s coal imports have been surging, increasing 24percent month-to-month in July as power generators increased purchases to provide for peak summer electricity demand. China has the largest number of operational coal power plants with 3,037 while Germany, the largest economy in the EU has 63.
The situation has led to soaring global coal consumption that could reach levels we have not seen in a decade, though there will be a limit to growth considering that investment in any new coal-powered plants has stalled. But that only makes the coal market tighter, pushing the energy source into an outperforming category.
Thermal coal, which is the variety used to generate power, has seen a 170 percent rise in price ince the end of 2021–most of those gains made following Russia’s invasion of Ukraine.
The German Dilemma
Germany is among the hardest hit by the growing energy crisis after effectively boxing itself into a corner with its energy policies. For decades, successive governments in Berlin have pursued a policy of maximising the country’s dependence on Russian oil and gas, and almost completely ditched nuclear energy with the final two functional reactors set to be turned off in 2022.
As a result, Germany has become heavily reliant on natural gas, with the fuel accounting for 25percent of the country’s total primary energy consumption.
Although Germany has substantial supplies of natural gas of its own that could be accessed by fracking, Berlin has banned the technology, meaning it has to import 97percent of its gas mainly from Russia, Netherlands and Norway.
In a worst-case scenario in which Russia stops all pipeline exports, Goldman Sachs’ Chief European Economist, Sven Jari Stehn and his team say, Euro area GDP growth is likely to fall by 2.2pp in 2022, with sizable impacts in Germany (-3.4pp) and Italy (-2.6pp).
Germany’s woes are partly excusable. The dramatic nuclear phase-out is as much part of the country’s Energiewende (energy transition) as the move towards a low-carbon economy.
Natural gas is cheap and reliable, produces only half as much emissions as coal, and is a critical input in many sectors. In Germany, 44percent of gas was used for heating buildings in 2020, while industrial processes consumed 28percent.
Gas is the best and cheapest feedstock for the manufacture of synthetic nitrogen fertilizer, of which Germany is a critical supplier. Gas is also used in refining, the production of chemicals, and many other types of manufacturing. All these are difficult, if not impossible, to completely replace with green energy anytime soon.
With a calamitous energy crisis unfolding, Germany will join the bandwagon of nations rolling back their climate goals by increasing its use of coal, which overtook wind to become the biggest input for electricity production globally in 2021.
Indeed, Germany is left with little choice than to burn lignite in its power plants—widely regarded as one of the dirtiest fossil fuels and extracted in vast open-pit mines that litter the German countryside.
The European Commission has already given its absolution to countries replacing Russian gas with coal and producing higher emissions as a result.
But coal is merely a stop-gap solution, and Germany must also be clear-eyed about its long-term energy future, a future without Russia’s gas.
Nuclear energy is out of the question considering that few, if any, European nations are as opposed to nuclear energy as Germany is. Back in February, German politicians vehemently denounced the EU’s attempt to label nuclear energy as sustainable.

By: Alex Kimani

Kimani reports for Oilprice.com

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Nigeria’s LPG Production Hits 5m Tonnes 

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The Federal Government says Nigeria currently produces about five million tonnes of Liquefied Petroleum Gas (LPG) annually and only eight per cent of the production is being utilised domestically, with the bulk being exported.
It says domestic LPG production stands at about 45 per cent of annual consumption, with Nigerian Liquefied Natural Gas Limited (NLNG) supplying 450,000 metric tonnes per annum while 55 per cent is imported.
Special Adviser to the President on Economic Matters in the Office of the Vice President, Dr Adeyemi Dipeolu, made this known recently at an India-Nigeria LPG Summit, Abuja, 2022.
The Tide’s source  reports that the India-Nigeria LPG summit was hosted by Nigerian National Petroleum Company Limited (NNPC Ltd.) with the support of the Office of the Vice President and World LPG Association (WLPGA).
The summit is expected to translate into bilateral exchanges to foster mutual collaboration and opportunities for the Nigerian LPG industry to learn from India’s experience, one of the world’s most successful National LPG penetration initiatives.
In a keynote address, Dipeolu said Nigeria had the ninth largest proven natural gas reserves in the world, and also the second largest producer of LPG in Africa after Algeria.
“LPG adoption in the Nigerian market, of course, is still very low with per capita consumption at about 1.8 kg, which is below the West African average.
“The household energy mix in Nigeria is about five per cent LPG, 65 per cent biomass and 30 per cent kerosene.
“The preference for the use of other sources is largely due to high switching costs associated with the acquisition of cylinders and LPG stoves, lack of awareness of associated benefits and safe LPG handling across consumer basis.
“There is also the high cost of LPG in comparison with alternative fuels, insufficient and inappropriate cylinders in circulation and inadequate infrastructure, especially trucks, roads, rail pipelines and plants,” he said.
He said the predominant use of biomass for household cooking resulted in deforestation and ambient air pollution, which also could lead to death due to stroke, heart disease, lung cancer and chronic respiratory diseases.
The Presidential Aide underscored the imperative for policies, incentives and investment to grow the Nigerian LPG market.
This, he said, would make cleaner fuel available, accessible and affordable, not only for household cooking, but also in autogas, captive power generation, heating and cooling as well as agriculture and industry.
He expressed optimism that Nigeria would learn from Indian’s experience with the Pradhan Mantri Ujjwala Yojana (PMUY) scheme implemented by the Indian Government in May 2016 such that LPG penetration in that country increased from 62 per cent to 100 per cent currently.
He said the theme of the summit, ‘Energising the Future: Leveraging the Indian Experience to Achieve Nigerian National LPG Aspiration’ underscored the need for cooperation and collaboration between the two countries.
Dipeolu said the cooperation should dwell on policy structures; health, safety and environmental methods and standards, ICT, infrastructure management techniques, stakeholder engagement and innovative programmes to incentivise Nigerian LPG market growth.
According to him, the recently enacted PIA specifically provides enablers for robust midstream and downstream gas development through promotion of policies, incentives and wavers to stimulate investments.
Others, he said, included removal of VAT on domestic LPG, presidential waiver on duty imported LPG equipment, tax holiday on new investment on gas and approval of eight new LPG terminals and storage facilities to add 150,000 metric tonnes gas capacity.
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FG, NNPC Inject 20m Cylinders Via New Gas Coy

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The Nigeria National Petroleum Company (NNPC Ltd) is collaborating with the Office of the Vice President on establishment of Gas Funding Company Ltd for injection of 20 million cylinders in the next five years.
The NNPC Ltd said the company’s establishment, which involved collaboration of other relevant stakeholders and being done under the Marketer Cylinder Owned Model, would boost Liquefied Petroleum Gas (LPG) penetration.
The Group Chief Executive Officer (GCEO), NNPC, Malam Mele Kyari, said this at the opening of India-Nigeria Liquefied Petroleum Gas (LPG summit) in Abuja.
The India-Nigeria LPG summit was hosted by the NNPC with the support of the Office of the Vice President and World LPG Association (WLPGA).
The summit is expected to translate into bilateral exchanges to foster mutual collaborations and opportunities for the Nigerian LPG industry to learn from India’s experience, one of the world’s most successful national LPG penetration initiatives.
The summit has its theme as: “Energising the Future: Leveraging the Indian Experience to Achieve Nigerian National LPG Aspiration.”
Kyari, represented by the Group Executive Director, Downstream, NNPC, Mr Adeyemi Adetunji, said the summit would be required to submit a report detailing gaps identified and recommendations on best practices from the Indian experience.
This, he said, would be for adoption in Nigeria by relevant stakeholders to achieve rapid National LPG penetration.
He said the summit would equally discuss the Nigerian experience and Indian example covering safe LPG handling, pricing and financial support.
According to him, this will enhance LPG affordability among the poor, communication strategies, ICT and infrastructure as well as collaboration on Cylinder management and manufacturing.
Kyari said Nigeria had identified its abundant gas resources as fuel for energy transition which informed its net zero commitments by 2060 and the declaration of 2021-2030 as Decade of Gas.
“NNPC Ltd is an energy company with new investments in gas, power and renewables. Key pipeline projects such as ELPS II, OB3 and AKK to deliver a total of 6.2 billion cubic feet of gas per day to demand nodes across the country are at various stages of completion.
“We have strong presence in the LPG value chain contributing about 45 per cent of domestic supply via JVs (Oso Bonny River Terminal) affiliates (Nigeria LNG Ltd and Ashtavinayak Hydocarbon Ltd) and subsidiaries of NPDC.
“The NNPC Ltd. is fully aligned with the Federal Government’s National Gas Expansion Programme (NGEP) and National LPG Expansion Plan initiatives and has a full-fledged LPG business unit established to commercially drive the National LPG penetration.
“Accordingly, NNPC Ltd is commissioned to deploy 740 LPG Micro Distribution Centres (MDCs) 37 Filing Plants and Skids in its 541 stations within the next three years,’’ he said.
Michael Kelly, the Chief Advocacy Officer and Deputy Managing Director, WLPGA, said the both countries had a powerful role to play in geopolitics for the rest of the century.
Kelly said the discussions would be followed up to foster the cooperation during its LPG week in Delhi in November, adding that looking at lessons learnt and grafting them into Nigerian context would be impactful.
He said the focus of the summit was to share India’s experience with the Pradhan Mantri Ujjwala Yojana (PUMY) scheme implemented by the Indian Government in May 2016.
This scheme pursued an aggressive LPG penetration drive, providing free cylinders, stoves and valves to end users.
This resulted to growth in LPG consumption in last 10 years, with the Indian National consumption currently at 30 million MT per annum and LPG penetration from 62 per cent in 2016 to 99 per cent in 2019.

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TotalEnergies Commits To Grooming Young Leaders

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An International Oil Company (IOC), TotalEnergies, has restated its commitment to grooming tomorrow’s leaders using its Book Reading programme as a way of helping children to deal with all distractions, including social media.
Deputy Managing Director, Joint Venture Assets (JVA), TotalEnergies, Guillaume Dulout, made this known at the company’s 2022 Book Reading and Open Day held in Port Harcourt for Senior Secondary Schools in Rivers State, weekend.
Represented by General Manager, Facilities Management and Administration, Mr Patrick Somiari, Dulout noted that it was exciting to the Book Reading event, being the first physical book reading event after the COVID-19 lockdown and restrictions.
He added that TotalEnergies would apply the Book Reading and Open Day programme, with the theme, “Today A Reader, Tomorrow A Leader”, to drive a sustained measure to nurture children into becoming successful leaders of tomorrow.
He explained that the annual Book Reading programme is TotalEnergies/NNPC Joint Venture’s goodwill to encourage students to embrace reading as a way of life, noting that “Open Day presents a window to share career paths and opportunities in order to guide the students to make informed and rewarding career decisions”.
Observing that reading did not come without some difficulties, Dulout encouraged the students to continue to push as it was the only way to prepare for leadership.
According to him, “being a leader does not usually come without effort. Thankfully, the few who put in the work prepare themselves to be leaders when the opportunity comes.
“Perhaps, nothing positions you better for leadership than reading. You must read; read regularly, read voraciously. It was in that light that the English philosopher and statesman, Sir Francis Bacon, observed that ‘Reading maketh a full man’.
“Reading involves a considerable level of concentration and thus, nurtures patience. What follows is better vocabulary and knowledge. Indeed, patience, knowledge and a rich reservoir of vocabulary help you establish the identity of a leader. Reading nurtures values that make you a leader”.
He stated that the book chosen for the event, “Diary of Fatherland”, by Charles Nelson, was chosen for its content as it would increase their appetite for books and place them on the path of leadership.
“You must start reading today. The book we have chosen to read at today’s event, ‘Diary of Fatherland’ by Charles Nelson, is designed to heighten your appetite for books and place you on the path of leadership.
“Of course, you will not find reading a piece of cake or undemanding, especially in the times we live in. If dealing with the appeal of the traditional media, especially TV and cinema, was difficult, the proliferation and allure of the social media would make reading more challenging.
“But don’t allow these media and their devices to be a drag on your dream of becoming a leader. I believe all the distractions that are incidental to young ones today have magnified the importance of the Book Reading & Open Day programme”, he said.
He charged them, saying, “Participate, be attentive, be involved, read. My sincere hope is that at the end of today’s programme, you would make the decision to be a reader, a leader”.
In his remarks, the Rivers State Commissioner for Education, Prof Prince Chinedu Mmom, charged the students to sustain their reading habits as there was no short cut to academic progress.
Participants were drawn from 10 Rivers Senior Secondary Schools, including Bluebell Montessori International Secondary School; Government Girls Secondary School, Rumuokwuta; Army Day Secondary School, Bori Camp; Community Secondary School, Okporo; Community Secondary School, Rumuomasi; Community Secondary School Rukpokwu; Graceland International School; Community Comprehensive  Secondary School, Rumuokwurusi; Tantua International Group of Schools; and Government Technical College, Port Harcourt.

By: Tonye Nria-Dappa

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