22
REGIONAL REVIEWS
By Tsvetana Paraskova
Europe
Energy Review
The completion of a major new natural gas corridor in southern Europe, plans for green recovery from the pandemic in the European Union and the UK, and net-zero pledges from the biggest European oil and gas firms from Norway to Spain topped the energy news flow in 2020—a year in which renewable energy projects and commitments continued while the oil and gas industry saw another downturn.
Trans Adriatic pipeline begins commercial Four and a half years after construction started, the Trans Adriatic Pipeline (TAP), a strategic piece and the last link in the Southern Gas Corridor (SGC) project, became operational in the middle of November, paving the way to diversification of gas supplies to southern Europe away from Russia. TAP is the European leg of the Southern Gas Corridor, a gateway project that will transport 10 billion cubic metres (bcm/a) of new gas supplies from Azerbaijan to multiple markets in Europe. “As a new transmission system operator, developed and built in compliance with best industry practices and standards, TAP enables double diversification: a new, reliable and sustainable energy route and source of gas reaching millions of European end-users, for decades to come,” said Luca Schieppati, TAP’s Managing Director. Commenting on the start of commercial operations, Murray Douglas, Wood Mackenzie Research Director, said: “This is a long-awaited and impressive milestone for all stakeholders. It is the first delivery of contracted Azerbaijani gas beyond Turkey, provides a fourth gas import pipeline corridor for the EU, boosts diversification and energy security, and is an inflection point for importreliant gas markets in Italy, Bulgaria and Greece.” “All eyes will be on the binding phase of TAP’s market test in summer 2021. This could be a bellwether for the post-lockdown recovery of European gas fundamentals,” Douglas noted.
Johan Sverdrup oil field credit: Equinor
www.ogv.energy I December 2020
Major oil & gas firms commit to Net Zero emissions Due to the crash in oil and gas prices and reduced demand for both oil and gas in the pandemic, the largest oil and gas companies in Europe reported losses or significantly lower earnings in their quarterly financial reports in 2020. But all of them, alongside the major UK offshore operators bp and Shell, announced plans to become net-zero energy businesses by 2050 or sooner and committed to gradually cut emissions not only from their operations but also from the products they sell. Spain’s Repsol was the first major firm to announce such a target—back in December 2019 and before the COVID-19 pandemic slashed demand for oil and fuels in 2020, with an uncertain timeframe as to when global oil demand will return to pre-crisis levels.
“We want to be main actors in a Just Energy Transition, in which we believe, and is central to Eni’s transformation,” CEO Claudio Descalzi said. France’s Total also confirmed its net zero ambition in September, aiming to become a broad energy company and grow its energy production by one third, with half the growth from LNG and half from electricity, mainly from renewables. Total’s chief executive Patrick Pouyanné told French newspaper Le Parisien in September that the firm aims to be among the world’s top five producers of renewable energy. The company’s operations mix today is 55% oil, 40% gas, and less than 5% electricity from renewables, Pouyanné said, noting that in 2050, Total’s operations will be divided into 20% oil, 40% gas, and 40% renewable energy.
Repsol set a target for net-zero emissions by 2050 both from its production and products, with interim targets in 2025, 2030, and 2040. Repsol is focused on expanding its renewables portfolio, boosting biofuel production, generating low-carbon electricity, and develop technologies to cut emissions from the entire value chain.
Norway’s Equinor was the last of the big oil companies in Europe to announce a net-zero energy company ambition. The announcement came in early November, the day on which Anders Opedal took over as CEO and President of Equinor. The company’s ambition, which includes emissions from production and final consumption of energy, shows Equinor’s continued commitment to long-term value creation in support of the Paris Agreement, it said.
“We do it with the utmost confidence that we’re investing in the future, and addressing the significant challenges that lie ahead with strategic clarity is what will enable us to turn them into opportunities,” Repsol’s chief executive Josu Jon Imaz says.
Renewables, especially offshore wind, carbon capture and storage (CCS) and natural sinks, as well as the development of competitive technologies for hydrogen, will be the pillars of Equinor’s strategy to become a broad energy company.
Italy’s Eni announced in June a “new business structure to be a leader in the energy transition,” creating an Energy Evolution division in the company to accelerate its plans to significantly boost renewable power generation and biofuels production.
“Equinor is committed to being a leader in the energy transition. It is a sound business strategy to ensure long-term competitiveness during a period of profound changes in the energy systems as society moves towards net zero,” Opedal said in a statement.
