Wednesday, 18 September, 2024 / Edition 25

We spent part of last weekend watching this year’s Solheim Cup, as the top women golfers from America and Europe put on some exciting competition for their country and region.

Now, let’s tee off with two interesting pieces of energy news from the past week.

Shangyou Nie

Editor, Well Read

Five EU Countries Attempt to Shape COP29 Agenda Around Fossil Fuel Phaseout

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The Financial Times reported that five E.U. countries are pressuring Azerbaijan—the host country for COP29 in November—to prioritize discussion around ending fossil fuel use in the conference’s agenda. Oil-rich countries are fighting back.

Catch up fast:

• During last year’s COP28, the nations reached a breakthrough agreement, known as the UAE Consensus, “to transition away from fossil fuels in an orderly and equitable manner.”

• The UAE Consensus included a global goal to triple renewable energy capacity and double energy efficiency by 2030.

The two sides:

• The FT article says negotiators from the five unnamed western countries are pushing discussion around a global fossil fuel phaseout.

• The opposing oil-rich countries include Saudi Arabia, Russia and Bolivia. This group is trying to frustrate the progress promoted by E.U. countries.

What they are saying:

• “We’re having to be very clear with Azerbaijan that this COP won’t be a success if we don’t also talk about the process of implementing mitigation, including the COP28 decision,” said one of the negotiators from the West.

• Another E.U. official said: “We confirmed [with Azerbaijan that] it’s very important we are able to pursue work on the Dubai consensus, and we will ensure that this is part of the conversation.”

• Another western negotiator expressed his concern that the G77 group—a large group of developing countries within the U.N. that’s led by China— will unite to block meaningful progress related to the UAE Consensus.

• The G77 recently held a conference in New York on 12 September to discuss South-South Cooperation.

About COP meetings:

• The United Nations Climate Change Conferences are held annually, guided by the U.N. Framework Convention on Climate Change (UNFCCC).

• The Conferences of the Parties (COP) 29 meeting will be held in Baku from November 11–22, 2024.

• This will be the third consecutive year that the biggest U.N. climate conference is held in an oil exporting country: COP27 was held in Sharm El-Sheikh, Egypt, and COP 28 was held in Dubai, UAE.

• COP30 will be held in Brazil in 2025, while the host country for COP31 has not yet been agreed upon.

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CNPC Signs Two Offshore Suriname Blocks, Signaling a New Strategy

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Last Friday, Staatsolie, Suriname’s state company, announced that it has awarded two offshore blocks to PetroChina, the publicly traded subsidiary of China National Petroleum Corp.

What did CNPC sign: The new signing is significant for the growth strategy of China’s largest NOC.

• CNPC signed Blocks 14 and 15 in the eastern part of the Suriname-Guyan basin.

• These two blocks are in shallow water with a depth between 50 and 150 meters and were part of Suriname’s Shallow Offshore 2 Bid Round 2023–2024.

• Blocks 14 and 15 border Block 52 to their west, which belongs to operators Petronas and ExxonMobil.

• Petronas is also evaluating a joint development program for the oil and discoveries in Block 52, including a potential standalone floating LNG project.

• PetroChina will serve as the operator and hold 70 percent equity, with Staatsolie holding the remaining 30 percent through its subsidiary Paradise Oil Co.

E&P in Suriname:

• Suriname has not yet seen the exploration success of its neighbor Guyana.

• Total, APA, ExxonMobil, Hess, Shell, Chevron, and Qatar Energy are all involved in E&P developments in offshore Suriname.

Block 58:

• TotalEnergies and its partner APA Corp. are progressing toward FID for the $9 billion Sapakara South and Krabdagu joint development project in Block 58, estimated to contain 700 million barrels of recoverable oil.

• Block 58 has a water depth between 50 and 2,150 meters.

• The Total/APA project will have a production capacity of 200,000 bopd, and first oil is expected in 2028.

Block 59:

• ExxonMobil and Equinor exited Block 59 in July, leaving Hess to decide whether to enter next phase of exploration by July 2025.

• Equinor completed withdraw from Suriname, but ExxonMobil still holds 50 percent interest in Block 52, in which operating partner Petronas has led the discovery of three oil fields.

CNPC’s new strategic direction:

• These two shallow water offshore blocks represent CNPC’s entrance into Suriname.

• These blocks are rare signings of overseas exploration acreage by CNPC recently. The company has focused on domestic E&P over the past few years, despite only 0.8 percent growth in domestic production in 2023.

• Overall, though, CNPC is a significant international E&P player with operations in more than 30 countries, focusing on development projects.

• According to Reuters, Mr. Lu Ruquan, CNPC’s director of its Economics & Technology Research Institute, has said CNPC is re-evaluating its strategy to begin investing in overseas assets again.

• CNPC is not an experienced deepwater E&P player. In overseas deepwater projects, including those in Brazil and Mozambique, it tends to be a non-operating partner.

• CNPC does have some shallow-water operating experience from its shallow/transitional zone oil/gas fields in the Bohai Bay.

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✉️ To get in touch with Shangyou, send an email to editorial@aapg.org.