Sheep on a road in view of mobile offshore drilling units in the Port of Cromarty Firth in Cromarty, U.K., on Tuesday, June 23, 2020.
Jason Alden | Bloomberg | Getty Images
LONDON — Costa Rica and Demark are spearheading efforts to build the world’s first diplomatic allianceto manage the decline of oil and gas production.
The co-leaders of the initiative, known as the “Beyond Oil and Gas Alliance,” are seeking to establish a deadline for the end of oil and gas production that would get countries aligned with the 2015 Paris Agreement. This legally binding treaty aims to limit global heating to below 2 degrees Celsius above pre-industrial levels — and preferably to 1.5 degrees Celsius. Meeting the conditions of the agreement is widely recognized as critically important to avoid an irreversible climate crisis.
The Beyond Oil and Gas Alliance is expected to formally launch at U.N.-brokered climate talks in early November, a summit known as COP26.
Until then, Costa Rica and Demark are seeking to persuade as many countries and jurisdictions as possible to join them in bringing an end to oil and gas production.
Speaking on Thursday during an online webinar hosted by the International Renewable Energy Agency, Dan Jorgensen, minister for climate, energy and utilities for Denmark, said: “The science is clear. We cannot negotiate with nature.”
“There is no scenario in which we burn all the oil and gas that we can find and in which we stay below 2 degrees — and definitely not 1.5. It is just not possible, so we need to stop.”
They are simply inferior technologies by now. They weren’t inferior last century but, in this century, given the rise of all the other alternatives that we have, they have become inferior technologies.
Christiana Figueres
Former U.N. climate chief
Denmark pledged in December last year to end all future licensing rounds on oil and gas exploration in the North Sea and put a stop date of 2050 on oil and gas production. At that time, the relatively small European country was the largest oil producer in the European Union.
“On one hand, if you look at it, it is a huge thing to ask a country,” Jorgensen said, acknowledging the challenge of trying to persuade others to sign up to the alliance.
“What you are saying, like one of my political opponents did when I proposed this in Denmark, is: ‘So, basically you want us to say no to free money? You want us to stop pumping money out of the ground so that others can do it instead of us?'”
“And I had to say: Well, yes,” Jorgensen continued. “But it is for a good reason.”
Climate hypocrisy
Andrea Meza, environment and energy minister for Costa Rica, said on Thursday that some opposition political parties were pushing the country’s government to consider using oil and gas revenues to pay for their energy transition. “We are very clear that this is not the right pathway.”
Costa Rica, a Central American country of around 5 million people, has never extracted oil. What’s more, it is currently considering a bill to permanently ban fossil fuel exploration to ensure that no future government does so.
When asked during the same webinar why other countries would consider joining their initiative, Meza said that platforms such as the Beyond Oil and Gas Alliance need to exist to show others that it is possible.
“It is just one planet,” Meza said. “This is not about doing things in the right way in the internal part of our countries and selling … all of the old technologies outside of our borders. This is not fair.”
U.S. Secretary of State Antony Blinken (C), Costa Rica’s First Lady Claudia Dobles (L) and Costa Rican Minister of Environment and Energy Andrea Meza (R) are seen during the launch of the National Land Use, Land Cover, and Ecosystems Monitoring System (SIMOCUTE) in San Jose, on June 2, 2021.
EZEQUIEL BECERRA | AFP | Getty Images
Research published in the scientific journal Nature on Sept. 9 found that the vast majority of the world’s known fossil fuel reserves must be kept in the ground to have some hope of preventing the worst effects of climate change.
Separately, analysis published by Carbon Action Tracker on Wednesday, showed that none of the world’s major economies are currently on track to contain global heating to the Paris Agreement target of 1.5 degrees Celsius.
It follows a bombshell report from the influential, yet typically conservative, International Energy Agency earlier this year. The IEA concluded that there could be no new oil, gas or coal development if the world was to reach net zero fossil fuel emissions by 2050.
Environmental activists and Native Americans march to the construction site for the Line 3 oil pipeline near Palisade, Minnesota on January 9, 2021. Line 3 is an oil sands pipeline which runs from Hardisty, Alberta, Canada to Superior, Wisconsin in the United States.
KEREM YUCEL | AFP | Getty Images
Denmark’s Jorgensen said it would be “impolite” to name specific countries, but described it as a “paradox” that many governments were touting their commitment to net zero by 2050 while also quietly planning to extract oil and gas to sell to others. These countries include the U.S., Canada, Norway and the U.K., among others.
“You are not going to burn it yourself and you think others shouldn’t either, but you will make money selling oil to other countries? It doesn’t make sense,” he added.
Jorgensen said he did not want to dismiss the fact that signing up to the yet-to-be-revealed pledges of the Beyond Oil and Gas Alliance would come with difficult economic choices, particularly those heavily reliant on oil and gas. “But, it is the tough questions that we need to ask ourselves.”
“Can we live with a future where we don’t do this? I don’t think that we can.”
‘Inferior technologies’
Speaking alongside Denmark’s Jorgensen and Costa Rica’s Meza on Thursday, former U.N. climate chief Christiana Figueres addressed the urgent need for governments to dramatically scale down fossil fuel use. She cited air pollution, caused mostly by the burning of fossil fuels, which kills an estimated 7 million people worldwide every year.
Figueres also stressed that the economic imperatives for moving beyond oil and gas were compelling. “They are simply inferior technologies by now. They weren’t inferior last century but, in this century, given the rise of all the other alternatives that we have, they have become inferior technologies.”
Pipes for the Baltic Pipe gas pipeline are stacked at Houstrup Strand, near Noerre Nebel, Jutland, Denmark, on February 23, 2021. The Baltic Pipe gas pipeline, which is to come ashore at Esbjerg, on the west coast of the Jutland peninsula, will transport ten billion cubic meters of gas every year from the Norwegian gas fields in the North Sea through Denmark and to Poland.
JOHN RANDERIS HANSEN | AFP | Getty Images
An increasing number of cities banning the use of fossil fuel burning vehicles was likely to usher in “the demise of oil,” Figueres said. The end of gas production may take longer given that it is recognized as a transition fuel, she said, but still not more than 20 to 30 years as there are alternative fuels coming on the market, such as hydrogen and ammonia, “that will be able to compete favorably.”
In summary, Figueres said the economic case, “pounding” litigation in Europe and elsewhere and a social license for these fuels that has been “completely lost,” showed that there is no more space for oil and gas production.
Petter Winberg, Tesla crash safety architect, via LinkedIn
Tesla’s top crash safety architect, who helped the automaker achieve top safety scores for its entire car line-up, announced that he is leaving the automaker after 14 years.
We are talking about Petter Winberg, Tesla’s Principal Engineer for CAE crashing safety for the last decade.
After an extensive career at Volvo and SAAB, both car brands praised for their commitment to safety, Winberg joined Tesla in 2011 to work on the “crash safety development of Model S structure and side occupant restraints.”
At the time, Tesla was still working on the Model S, its first vehicle built entirely from the ground up, considering the original Roadster was based on the Lotus Elise.
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CEO Elon Musk aimed for “Tesla vehicles to be the safest on the planet,” and Winberg took the challenge seriously.
He led the development of the vehicle body and chassis structure for Model 3 and Model Y, as well as the crash structure for Model S and Model X.
All of these vehicles have received top safety crash scores from independent testers worldwide – quickly elevating Tesla’s brand into a leader in passive safety.
Winberg and his team deserve a lot of the credit for this.
The engineer also led the design of crash readiness and the energy-absorbing capacity of Tesla’s latest “gigacasting” and structural battery pack designs, for which he obtained patents. Other automakers have since adopted similar designs.
For those less technical who want to understand how good and respected Winberg is at Tesla, he has been working for Tesla remotely in Sweden for the last five years. That’s impressive in itself, considering how much Musk hates remote work. He previously emailed Tesla management to tell them that only exceptional employees would be eligible for an exemption to work remotely, which he would approve himself.
After 14 years at Tesla, Winberg announced last week that he is leaving (via LinkedIn):
Having developed Model S, S-DM, X, 3, Y, Y-SP as well as future crash architectures, I have decided now is the time to move on. Thank you Tesla, keep crushing it! What an incredible team, I will miss you all.
He didn’t elaborate on his reasons for leaving the automaker or announce another venture.
Electrek’s Take
While Tesla has received much criticism for the dangers of its Autopilot and “Full Self-Driving” systems, I don’t think anyone can question that Tesla vehicles perform extremely well in terms of passive safety.
Independent testing has proven it time and time again.
Tesla has led the way in taking advantage of designing electric vehicles from the ground up. Its skateboard-like powertrain design and lack of engine in the front allow for a giant crumple zone to absorb the energy in case of a crash.
A big thank you to Petter Winberg for his designs and leadership in improving Tesla’s passive safety. He has undoubtedly made the automotive industry safer and saved lives. Congratulations.
As for his departure, it’s certainly a blow for Tesla. As we previously reported, the company has suffered a significant exodus of talent over the last year, with a big part of its leadership leaving during and after a wave of layoffs last year.
Many predict that Tesla could again initiate another wave of layoffs in the coming months as its sales are crumbling worldwide.
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Its first vehicle, the SU7, is a smash hit. It now consistently delivers over 20,000 units a month, it has surpassed the Tesla Model 3, its closest competitor, and has a more than 30-week-long backlog of orders.
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The vehicle achieves more range and is cheaper than Model 3 while having additional features.
Last month, Xiaomi launched a new top-of-the-line version of the SU7: the SU7 Ultra.
The headline is that the $72,800 (529,900 RMB) has a powertrain packing up 1,526 horsepower. That’s absolutely insane. Xiaomi quotes a 0 to 100 km/h (0 to 62 mph) acceleration in just 1.98 seconds.
While the SU7 is meant more as a Model 3 competitor, the SU7 Ultra actually competes with Tesla’s flagship Model S Plaid in terms of performance.
They organized a drag race between the SU7 Ultra and Model S Plaid. Here it is:
As you can see, the SU7 Ultra slipped at the start, which is not surprising considering how much power it outputs, but it still managed to catch up and beat the Model S Plaid.
At over 1,000 horsepower, many, myself included, thought that it was a bit mad to offer a vehicle like the Model S Plaid with such supercar power for a relatively cheap price – RMB 814,900 (approximately $112,000 USD) in China and just $95,000 in the US.
But now, Xiaomi shakes things up even more by offering 1,500 horses for just a little more than $70,000. It’s mad.
Now, I can hear your thoughts: “but it’s just good in a straight line drag race like other EVs.” Think again, the SU7 Ultra prototype claimed the title as the fastest four-door sedan at the famous Nurburgring race track in Germany.
Electrek’s Take
Damn, the Chinese are good. Xiaomi has come hard with the SU7, but the crazy thing is that it’s just one of several Chinese top-of-the-line EVs coming out. Nio has the ET7, BYD has the U7, and there are many more.
These vehicles are all impressive in their own rights.
It’s easy to understand why American automakers are so scared and lobbied the US government for 100% tariffs on them.
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HOUSTON — The officials leading President Donald Trump’s energy agenda made clear to oil, gas and mining executives this week that they have an ally in Washington who intends to make it as easy as possible for them to drill in federal lands and waters.
Interior Secretary Doug Burgum told executives gathered for the world’s largest energy conference that the Trump administration does not view climate change as an existential threat. Energy Secretary Chris Wright said rising global temperatures are simply a byproduct of developing the country’s national resources to support economic growth and national security.
Burgum leads Trump’s recently established National Energy Dominance Council and Wright serves as his deputy on the interagency body tasked with boosting production. Burgum was effusive in his praise of the oil and gas industry during remarks delivered at CERAWeek by S&P Global conference.
“I’m going to share two words that I do not think that you have heard from a federal official in the Biden administration during the last four years. And those two words are thank you,” said Burgum, who previously served as governor of North Dakota, a state that produces 1.2 million barrels of oil per day.
Burgum leaned on his experience as software company executive to lay out his view of the interior department’s role. The department under his leadership views the companies developing resources on federal lands as “customers” who are contributing revenue to the nation’s “balance sheet,” Burgum said.
“If someone was sending me revenue, they weren’t the enemy. They were the customer,” Burgum said. The administration loves anyone who wants to harvest timber, mine for critical minerals, graze cattle, or produce oil and gas on federals, the interior secretary said.
Royalties sent from lease agreements on federal land will help the U.S. pay down its national debt and balance the budget, Burgum said. “You’re the customer,” the interior secretary told the executives.
The value of nation’s abundant natural resources far outweighs its $36 trillion in debt, Burgum said. If financial markets understood the value of America’s natural resources, the 10-year long-term interest rate would come down, Burgum claimed.
“The interest rates right now are one of the biggest expenses we have as a country,” Burgum said. “So one of the things that we have to do is unleash America’s balance sheet, and President Trump is helping us do that,” he said.
Burgum slammed the Biden administration’s focus on climate change as an “ideology.” He said the Trump administration views Iran acquiring a nuclear weapon and China winning the artificial intelligence race as the two existential threats facing the U.S. rather than global warming. Wright said Biden had a “myopic” and “quasi religious” belief in reducing emissions that hurt consumers.
Burgum and Wright dismissed policies that support a transition from fossil fuels to renewable energy, arguing that wind and solar won’t be able to meet rising energy demand in the coming years from artificial intelligence and re-industrialization.
“There is simply no physical way that wind, solar and batteries could replace the myriad uses of natural gas. I haven’t even mentioned oil or coal yet,” Wright said at the conference. Wright previously served as CEO of oilfield services company Liberty Energy and a board member at nuclear startup Oklo.
Oil execs see allies in Washington
Oil executives are enthusiastic about the change of administrations in Washington, returning the praise they received from Trump’s energy team during the week.
ConocoPhillips CEO Ryan Lance said Wright and Burgum “understand the business,” describing them as the best energy team the U.S. has seen in decades. TotalEnergies CEO Patrick Pouyanné said he was “impressed by the quality of our counterparts.” Chevron CEO Mike Wirth said the industry is “seeing some reality come back to the conversation.”
“For years, my message has been, we need a balanced conversation about affordability, reliability and the environment, and focusing only on climate leads us to ignore the first two,” Wright said.
The executives all referred to the Gulf of Mexico as the Gulf of America, following Trump’s executive order to rename the body of water. The president issued an order on his first day to repeal Biden’s ban on offshore drilling in 625 million acres of U.S. coastal waters.
BP CEO Murray Auchincloss briefly slipped before correcting himself when discussing how generative AI is helping with exploration: “We started doing this in the Gulf of Mexico, uh America, and we spread that to other nations as well.”
But Trump’s calls to “drill, baby, drill” are running up against market reality. The CEOs of Chevron and Conoco said U.S. oil production will likely plateau in the coming years after hitting new records under the Biden administration.
“Chasing growth for growth’s sake has not proven to be particularly successful for our industry,” Wirth said. “At some point, you’ve grown enough that you should start to move towards a plateau, and you should generate more free cash flow, rather than just more barrels.”
Lance sees U.S. oil production plateauing later this decade and then slowly declining.
“Maybe it’s time to go back to exploring the Gulf of America,” Pouyanné said. “The new administration is opening the Gulf. It has been slowed down after the Macondo drama,” he said, referring the Deepwater Horizon oil spill, the largest in the history of marine drilling operations.
U.S. oil producers are scheduled to meet with Trump next week, industry lobby group American Petroleum Institute said in statement.