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$70 Oil Won't Keep OPEC Happy

$70 Oil Won't Keep OPEC Happy

OPEC is reportedly reconsidering its…

Can Natural Gas Survive The Energy Transition?

Russia’s gas giant Gazprom believes that pipeline natural gas could be compatible with the global climate goals of greenhouse gas reduction and Europe’s commitment to net-zero emissions by 2050, according to Elena Burmistrova, Director General of Gazprom Export.

“So, speaking about the future of our industry, I’m sure that gas is fully compatible with the most ambitious climate goals, and it can and has to take up the key role in the rational and safe energy system,” Reuters quoted Burmistrova as saying at the online European Gas conference on Wednesday.

According to the senior Gazprom official, pipeline natural gas emits fewer emissions than liquefied natural gas (LNG), which is competing with Russian gas on the European market.

Europe, the key market for Gazprom’s pipeline natural gas, has recently started to see natural gas not as a solution but as a problem in the EU climate goals to become a net-zero emissions bloc by 2050.

The European Union (EU) agreed last month that its Just Transition Fund (JTF) — worth US$21.2 billion (17.5 billion euro) and one of the EU’s key tools to support regions in the transition towards climate neutrality by 2050—will not fund any investments in fossil fuels.

Related: Egypt Looks To Resume LNG Exports As Prices Rise

Investments related to the production, processing, transport, distribution, storage, or combustion of fossil fuels cannot be funded through the JTF, the EU has said.  

Last year, France’s government reportedly asked local power group Engie, in which it holds more than 20 percent, to delay the signing of a 20-year deal worth US$7-billion to buy LNG from a planned export project in Texas due to concerns over gas production emissions, Politico reported in October, quoting sources with knowledge of the issue.

Just this week, the President of the European Investment Bank (EIB), Werner Hoyer, said, “To put it mildly, gas is over,” during a conference to discuss the bank’s annual report.

By Charles Kennedy for Oilprice.com

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  • Mamdouh Salameh on January 27 2021 said:
    Natural gas is the pivot for any global energy transition without which there can never be any meaningful transition. Anybody who says otherwise must be ignoring the facts or ignorant of the facts.

    A global energy transition can never proceed without major contributions from natural gas and nuclear power. Furthermore, piped natural gas emits fewer less emissions than LNG. That is why President Biden’s administration is going to tighten the laws governing methane emissions from production of shale oil and gas. That is also the reason why Last year, France’s government reportedly asked local power group Engie, in which it holds more than 20%, to delay the signing of a 20-year deal worth US$7-billion to buy US LNG due to concerns over LNG gas emissions.

    Oil and gas will continue to drive the global economy well into the future. Therefore, the notion of net-zero emissions by 2050 or even 2100 is an illusion.

    Dr Mamdouh G Salameh
    International Oil Economist
    Visiting Professor of Energy Economics at ESCP Europe Business School, London

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