Wednesday, October 26, 2022

FT: Europe faces critical shortage of metals needed for clean energy

 The Financial Times writes: 

Europe faces a critical shortage of clean-energy metals and needs to decide urgently how it will bridge the looming supply gap or risk new dependencies on unsustainable producers. 

 That is the conclusion of a new study commissioned by Eurometaux, an industry group that represents some of the region’s biggest metal producers, including Glencore and Rio Tinto.

  The report, written by Belgium’s Katholieke Universiteit Leuven, marks the first attempt to provide some EU-specific numbers around last year’s warning from the International Energy Agency of supply challenges owing to the amount of metals needed for batteries, solar panels and wind turbines. 

 It comes as the EU, which is aiming to be carbon neutral by 2050, looks to reduce its dependence on imported Russian energy and make a quicker switch to renewable energy.

 “There is a risk . . . with the geopolitical developments we are seeing round the world that Europe . . . will not have the metal for its climate programme,” said Mikael Staffas, president of Eurometaux and chief executive of Boliden, one of Europe’s biggest metals and mining companies. He was speaking before the launch of the study in Brussels.

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Lithium: Imerys will exploit lithium mine in France

 World leader in industrial minerals Imerys announced monday 24 october that in the french town of Echassières, writes Le Monde

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On Monday, October 24, the Imerys group, the world leader in industrial specialty minerals, announced the launch of a major lithium mining project in Echassières (central France). Since the end of the 19th century, this open-pit mine – named "de Beauvoir" after the former operating company and located on the edge of the Colettes forest on the border between the Allier and Puy-de-Dôme departments – has produced 25,000 to 30,000 tons of kaolin for ceramics every year.

Studies and core sampling predict the presence at a great depth of high concentrations of lithium hydroxide, a total of 1 million tonnes containing between 0.9% and 1% of oxide, confirming the estimates of the French Geological and Mining Research Bureau (BRGM). This deposit will enable 34,000 tons to be extracted over 25 years, making Imerys a leading supplier to the European market, with a capacity to equip 700,000 vehicles per year with lithium-ion batteries.

In addition to the studies already carried out for €30 million, the project will require a minimum investment of €1 billion, based on an estimated lithium production cost of €7-9 euros/kilo. Imerys considers this "very competitive, particularly on the European market, and sufficient to guarantee a return on investment in line with group guidelines."

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Monday, August 22, 2022

EU: Commission approves german 27.5 Bn energy-compensation scheme

 The European Commission has approved, under EU State aid rules, a German scheme to partially compensate energy-intensive companies for higher electricity prices resulting from indirect emission costs under the EU Emission Trading System (‘ETS').

Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “This €27.5 billion scheme will allow Germany to reduce the impact of indirect emission costs on its energy-intensive industries and hence the risk that these companies relocate their production to countries outside the EU with less ambitious climate policies. At the same time, the measure will facilitate a cost-effective decarbonisation of the German economy in line with the Green Deal objectives, while limiting possible distortions of competition.”

The German measure

The scheme notified by Germany, with a total estimated budget of €27.5 billion, will cover part of the higher electricity prices arising from the impact of carbon prices on electricity generation costs (so-called ‘indirect emission costs') incurred between 2021 and 2030. The support measure is aimed at reducing the risk of ‘carbon leakage', where companies relocate their production to countries outside the EU with less ambitious climate policies, resulting increased greenhouse gas emissions globally.

The measure will benefit companies active in sectors at risk of carbon leakage listed in Annex I to the Guidelines on certain State aid measures in the context of the greenhouse gas emission allowance trading scheme post-2021 (‘ETS State aid Guidelines'). Those sectors face significant electricity costs and are particularly exposed to international competition.

The compensation will be granted to eligible companies through a partial refund of the indirect emission costs incurred in the previous year, with the final payment to be made in 2031. The maximum aid amount will be generally equal to 75 % of the indirect emission costs incurred. However, in some instances, the maximum aid amount can be higher to limit the remaining indirect emission costs incurred to 1.5 % of the company's gross value added. The aid amount is calculated based on electricity consumption efficiency benchmarks, which ensure that the beneficiaries are encouraged to save energy.

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EU: energy cooperation between the bloc and Ukraine and Moldova

 Transmission System Operators for Electricity of Continental Europe agree to increase the trade capacity with the Ukraine/Moldova power system,

On 28 July, the Transmission System Operators (TSOs) of Continental Europe agreed to increase the trade capacity with Ukraine/Moldova to 250 MW which is more than double the capacity that was set in the initial phase (100 MW). The possibility of further increasing trade capacity will be assessed in September based on power system stability and security considerations.

Commercial electricity exchanges with the Ukraine/Moldova power system started on 30 June on the interconnection between Ukraine and Romania, followed by the Ukraine-Slovakia interconnection on 7 July. Electricity trading on the other interconnections (Ukraine-Hungary and Moldova-Romania) is expected to follow later.

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Germany: politicians shun fracking-option to mitigate gas import problems

As Germany is severley affected by the cut-back of russian piped gas and also in the light of ethical consideration the fracking-option, banned in 2017, is again put forward. However politicians and lawmakars are reluctant: WELT:

Germany is stuck in the natural gas crisis and is dependent on Russian supplies, which are being reduced. The focus is on Germany's own resources: Huge amounts of natural gas lie beneath Germany, which geologists say could supply the country for decades.

The energy reserves could be tapped by fracking. But the previous federal government banned the drilling technology in 2017, even though scientific reports had also shown fracking to be practicable in Germany.

The ban is not set in stone, according to the Water Resources Act it should be reconsidered: The German Bundestag was obliged to review the appropriateness of the fracking ban as early as 2021 - "on the basis of the current state of science and technology", as the law states . However: That did not happen – despite the gas crisis.

When asked by WELT, the Bundestag pointed out that the “Fracking Expert Commission” only submitted its report from 2021 at the end of June, on the basis of which advice should be given. The factions of the parties represented in the Bundestag would now decide when the parliamentary deliberations would take place.

Saturday, August 20, 2022

Natural Gas: Germany considers LNG imports from Senegal

 With gas supply from russia becoming more precarious and ethically problematic, Germany is scouting around for new sources of supply. On his jorney through several african countries, germany Chancellor Olaf Scholz has explored options of gas exportations of gas from Senegal zu Germany. Climate advocates however find fault with this, WELT:

Senegal has big plans: The West African country wants to use the newly created gap in the gas supply and supply industrialized countries like Germany with liquefied natural gas (LNG) in the future.

According to estimates by the energy company BP, more than 425 billion cubic meters of natural gas are waiting to be extracted off the coast of Senegal and Mauritania. The local enthusiasm is great: “Experts consider the estimated gas resources in Senegal to be world-class. Senegal is on the way to becoming a major gas exporter,” says the Senegalese newspaper Le Quotidien.

Although the country has large gas reserves, it was only the Ukraine war and the move away from Russian gas that really revived hopes of a boom. "The war changed everything," quoted the Washington Post as Mamadou Fall Kane, deputy chief of Senegal's natural resources agency. "Now Europe is knocking on our door."

Because after Africa was asked for years by the European Union, for example, to rely on renewable energies, the energy crisis is now also focusing on fossil fuels again in industrialized countries that want to free themselves from dependence on Russia.

The federal government is also positioning itself: during his trip to Africa in May, Chancellor Olaf Scholz (SPD) campaigned in Senegal for closer cooperation on the expansion of the gas infrastructure. It makes sense to "follow closely" such cooperation, this is a "common concern," Scholz said after talks with Senegalese President Macky Sall in Dakar. "We also want to do this with regard to the LNG issue and gas production here in Senegal."

At first glance, that sounds like a win-win situation: African gas can put Germany's energy supply on a broader footing. In return, Senegal could benefit if liquid gas terminals are built with the technical know-how from Germany.

In reality, however, the project is more complicated.

Saturday, August 13, 2022

Mediterranean: Lebanon and Israel dispute over access to Karish gas field

 Lebanese party and militia leader Hassan Nasrallah was issued a warning to Isreal to claim the gas field for itself, writes SPIEGEL:

In the border dispute over gas deposits in the Mediterranean, the head of the radical Islamic Hezbollah militia in Lebanon, Hassan Nasrallah, has warned Israel against claiming them for itself. "The hand that reaches out for our riches will be cut off," the head of the Iran-backed militia said in a televised speech in Beirut on Tuesday. This is reported by the AFP news agency.

Nobody should be allowed "to plunder the country," said the Hezbollah chief in his speech to supporters. Lebanon's oil, gas and water supplies would have to remain under Lebanese control.

The USA is currently mediating in the smoldering and recently escalated border dispute between Israel and Lebanon over mineral resources in the Mediterranean – so far without a result. US mediator Amos Hochstein told the Lebanese media in early August that he was "optimistic" and was aiming for a solution for both sides. Accordingly, Israel should be able to continue its activities in the Karisch gas field and at the same time allow Lebanon access to the energy market.

The conflict escalated after Israel sent a gas production vessel towards the Karish gas field in June. However, parts of the gas field are claimed by Lebanon. Beirut then called for the resumption of talks mediated by the United States.

The discovery of large gas deposits in the eastern Mediterranean in recent years has aroused the desires of all the neighboring countries and fueled border disputes. From Israel's perspective, the gas field lies within its territorial waters and not within a disputed area at stake in negotiations with Lebanon over the maritime border between the two countries.

Lebanon and Israel negotiated their disputed sea border for the first time in October 2020, mediated by the United States. Negotiations were suspended in May 2021. The border dispute was initially about an 860 square kilometer stretch off the coast of both countries, and finally Lebanon demanded an additional 1,430 square kilometers, which also includes the Karisch field.

Formally, the neighboring countries are still at war and do not maintain diplomatic relations. The United Nations peacekeeping force Unifil, stationed in Lebanon since 1978, has patrolled the border since the 2006 Israeli-Lebanese conflict.