In focus: Finding common ground to navigate energy minefield for carbon-free world

The heatwaves scorching the globe this summer have brought home the dangers of raging climate change woes. This combined with the ongoing cost-of-living crisis and energy security concerns is forcing the world’s hand to rise to the occasion and tackle the challenges on the road to a more sustainable future. While no marching orders are in sight for the oil and gas sector, the energy and maritime industries are pulling out all the stops to curb emissions and decarbonise their operations.

Energy security shot to the top of countries’ agendas last year, following the global energy crunch, which gripped the world, threatening to devour and squeeze every drop of fuels that keep the lights and heat on in homes. This led to a change of plans in some countries, as their efforts to strengthen energy security put at risk their net-zero ambitions, leading to increased warnings from the International Energy Agency (IEA) about the need to accelerate the shift towards low-carbon and green energy sources. The IEA believes that curbing the methane footprint is the fastest way to lower greenhouse gas (GHG) emissions.

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As a result, the oil and gas industry is leaving no stone unturned in its quest to get rid of the methane menace. One of the latest methods to tackle this entails the use of drone and space age technology – developed by the NASA Jet Propulsion Laboratory (JPL) to search for life on Mars – to detect offshore methane emissions. According to SeekOps, a U.S.-based sensor company,  the system now allows for “cost-effective, safe, and accurate” methane emissions quantification and overcomes challenges posed by fixed-wing crewed and uncrewed aerial vehicles (UAV), which have restrictive flight patterns.  

Brendan Smith, SeekOps Chief Technology Officer and Co-Founder, commented: “With political, environmental, and social pressures building, oil and gas operators are searching for ways to effectively reduce methane emissions. This forward-thinking solution combines two cutting-edge pieces of technology to provide companies with a modern and effective means of measuring their offshore methane emissions.” 

Moreover, oil and gas companies around the world, along with the offshore drilling market, are finding ways to unlock energy in a less carbon-intensive manner, as demonstrated by Shell, TotalEnergies, ADNOC, QatarEnergy, ExxonMobil, BP, Eni, Diamond Offshore, Noble Corporation, and other industry players. BP’s lead backer position in a $12.5 million series A financing for Advanced Ionics is a case in point. The list of additional investors in the new capital of this developer of hydrogen electrolyzers includes Clean Energy Ventures, Mitsubishi Heavy Industries (MHI), and GVP Climate.

In addition, India’s state-owned giant ONGC is the latest player to unveil investment plans for the green shift. In a bid to scale up its renewable portfolio to 10 GW by 2030 and turn its low-carbon aspirations into reality, the company intends to invest around ₹1 trillion (about $12.03 billion) by the end of this decade in multiple green initiatives, including renewables, green hydrogen, and green ammonia.

Despite this pivot towards low-carbon and green energy, ONGC will keep oil and gas exploration and production as “the cornerstone of its energy business,” and has earmarked approximately $1.2 billion per year by 2025 for oil and gas exploration activities.

Multiple countries, including the UK, decided to embark on a balancing act, enabling them to continue pursuing more oil and natural gas along with renewables and other low-carbon sources of supply during the transition journey to a green future. Currently, Britain is taking steps to shore up different supplies to make its energy system more resilient to shocks.

To this end, the UK government’s energy blueprint envisions a step-up in the deployment of renewables – such as offshore wind and solar – and a scale-up of nuclear power along with a boost in the oil and gas production from the North Sea to power up Britain from within and cinch the fulfilment of its energy security and net-zero aspirations.

Grant Shapps, UK’s Energy and Net Zero Secretary, commented: “As history has shown, including more recently with the Russian invasion of Ukraine, global energy security and supply is interconnected. Shockwaves quickly travel around the world and hurt consumers and businesses by sending global prices soaring. We acted swiftly to protect the British public, providing unprecedented energy bills support, cutting off all Russian gas supplies, and setting out our blueprint for boosting homegrown energy production to power up Britain.”

With climate change taking its toll, the UK is adding renewables to its energy mix at an increased rate, as illustrated by new research from the team at Utility Bidder. This puts Britain amongst the top ten countries, which have recorded the most significant change in renewable energy supply since 2010, as the country’s amount of energy coming from renewables rose from 6.7 per cent in 2010 to 41.5 per cent in 2022 while it cut emissions by 48 per cent between 1990 and 2021.

In a bid to expand its green power, the UK unveiled a £22 million increase in backing for renewables through the government’s flagship Contracts for Difference (CfD) renewables scheme, taking the total budget to £227 million for this auction. The new funding signifies an increased budget for established technologies such as solar and offshore wind – from £170 million to £190 million; an increase in the budget for emerging technologies such as floating offshore wind – up from £35 million to £37 million; and maintaining £10 million ring-fenced budget for tidal stream projects.

As the world bends backwards to produce a climate plan rich in tangible action to cut greenhouse gas emissions, carbon capture and storage (CCS) has emerged as a potential solution that could pave the way for a carbon-free world. In line with this, many energy players are chasing global CCS opportunities. This includes Dyna-Mac, which joined forces with BW Offshore to leverage technical expertise in the oil and gas industry while meeting the rapidly evolving demands of a greener energy sector with the help of CCS projects.

The UK is on the list of the countries, which are actively pursuing decarbonisation with CCS, as hammered home by four licences it awarded this week for CCS projects in the North Sea. The first one was handed out to Perenco UK and Carbon Catalyst for the Poseidon CCS project at the Leman gas fields in the UK’s southern North Sea. This project, which is slated to come online by 2029, has the potential to significantly decarbonise both the East and Southeast of England with initial CO2 injection rates being about 1.5 million tonnes per annum (Mtpa) and rising to 40 Mtpa over a 40-year period.

This duo also got its hands on additional two CO2 storage licences for the Orion CCS project, which covers the decommissioned Amethyst field and the currently producing West Sole field. With a start-up in 2031, this project is expected to deliver an initial injection capacity of 1 million tonnes per annum and rise to 6 Mtpa later on. The remaining licence, which was awarded for Camelot to Wintershall Dea and Synergia Energy, entails an annual storage potential of up to 6 million tonnes.

While Britain is moving heaven and earth to explore the potential of CCS, Denmark, which is often seen as a trailblazer and a stronghold for renewable energy, put on hold the second tender round for the award of offshore CO2 storage licenses in the North Sea until the decision is made on whether the state participation share of future licenses should be set higher after the first tender round in the North Sea. Even though CCS is gaining ground, some fear it will lock in fossil fuel use, since they see it as a lifeline that the oil and gas industry can grab in a bid to extend its reign on the energy throne and keep on thriving in a low-carbon economy.

The journey to greener and more sustainable shipping offers many different paths, which are outlined in the International Maritime Organisation’s regulatory measures to slash the carbon footprint in the shipping industry and keep it on track to achieve its emission targets.

One of the highlights in the maritime industry this week came from Wallenius Wilhelmsen, which inked a letter of intent for the delivery of four 9,350 CEU methanol-capable and ammonia-ready vessels from mid-2026. In addition, this LOI comes with individual options for an additional eight car carriers. The vessels will be delivered by China’s Jinling Shipyard (Jiangsu).

Xavier Leroi, EVP & COO Shipping Services Wallenius Wilhelmsen, outlined: “We believe that methanol is the fastest way to net-zero emission, and the ordered vessels can upon delivery use alternative fuel sources such as methanol. The vessels will also be ammonia-ready and can be converted as soon as green ammonia becomes available in a safe and secure way.”

The week now behind us also brought a confirmation that the Global Centre for Maritime Decarbonisation (GCMD) had bunkered the third supply chain of a biofuel blend in partnership with, Singapore’s Eastern Pacific Shipping (EPS), as part of its pilot to develop a quality, quantity and GHG abatement assurance framework for drop-in green fuels.

Dr Sanjay Kuttan,Chief Technology Officer of GCMD, underlined: “Through this pilot, we demonstrated that different tracing techniques can help ensure the authenticity and quantity of sustainable biofuels in the supply chain. And using a biofuel blend with LPG can be a feasible pathway for ships to meet the recently revised IMO indicative decarbonisation checkpoint for 2030.”

The marine energy sector was a busy bee this week, as shown by Eco Wave Power, which tucked a new milestone under its belt by connecting the first wave energy project to Israel’s national electrical grid. With ten floaters installed along the Port of Jaffa’s pre-existing breakwater, the EWP-EDF One power station, which was co-founded and built in collaboration with EDF Renewables IL and the Israeli Energy Ministry, has an installed capacity of 100 kW. This is seen as enough to power approximately 100 homes at peak efficiency.

Since work started on the Swansea Bay City Deal and EU-funded Pembroke Dock Marine project in August 2022, progress has been made in bringing to life a multi-purpose and future energy-ready port in Pembrokeshire. The redevelopment plans are expected to ensure more flexibility for developers and marine businesses, which are interested in testing new marine energy devices, among other things.

Steve Edwards, commercial director at the Port of Milford Haven, stated: “These works will make a huge difference to the facilities and services that we can offer to the marine sector but also the growing renewables industry that is being attracted here due to the exciting opportunities for floating offshore wind projects in the Celtic Sea.”

While renewables of all shapes and sizes are seen as a godsend to tackling the climate crisis, the solar energy sector is undergoing unprecedented growth. The IEA’s predictions indicate that the global investment in clean energy technologies is on course to rise to $1.7 trillion in 2023, with solar set to eclipse oil production for the first time. In 2022, 230 million tons of CO2 emissions were saved through solar deployments globally.

Beyond Fossil Fuels coalition, an expansion of the Europe Beyond Coal campaign, which is striving for a just transition to a fossil-free, fully renewables-based European power sector by 2035, claims that Europe has 40 GW of solar panels stockpiled or the same amount installed across Europe in 2022. According to its Freedom from Fossil Fuels report, if these stored solar panels were deployed, they would displace seven billion cubic metres of fossil gas – equivalent to four per cent of Europe’s pre-war Russian fossil gas imports.

Tara Connolly, Beyond Fossil Fuels Campaigner, emphasised: “European countries need to expand training programmes for solar panel installers, address grid bottlenecks and streamline bureaucratic processes to get solar panels out of warehouses and onto the roofs of homes and businesses as fast as possible. This should be the top priority for governments across Europe trying to cut emissions and get Europe off gas rapidly.”

Europe is not alone in harnessing the potential of solar power as other continents have also hopped on this bandwagon. This week new floating solar projects popped up, including the plans to build a second 90 MW floating solar project at the Omkareshwar floating solar park in Madhya Pradesh, which will be done by India’s SJVN. The project is anticipated to reduce 234,304 tonnes of carbon emissions and would contribute to the Indian government’s energy transition goals.

Additionally, plans to develop around 1 GW of floating solar plant capacity on Laguna Lake, the largest freshwater lake in the Philippines, were outlined by ACEN. This, along with other initiatives in the renewable energy sector, is expected to assist the firm in reaching 20 GW of renewables by 2030.

Despite these decarbonisation milestones, many see continued exploration for more hydrocarbons and a dash for new oil and gas projects as red flags during the energy transition era, which could derail the progress towards a carbon-free world, as they are considered to be incompatible with net-zero emissions.

Last year has shown that trying to accurately predict the way the global energy industry is headed, is still the equivalent of playing a guessing game, as things can shift quickly depending on various factors, including geopolitical ones. While time will tell whether a sustainable energy future is on the cards by 2050, a just energy transition is still the end goal and the energy industry is sparring no effort to make this happen.

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