Environment

U.S. energy secretary tells skeptical executives natural gas export pause will be short-lived

Published

12 months ago

March 21, 2024

admin

US Energy Secretary Jennifer Granholm speaks during the CERAWeek oil summit in Houston, Texas, on March 18, 2024.

Mark Felix | AFP | Getty Images

HOUSTON — The Biden administration this week sought to reassure skeptical oil and gas executives that a pause on liquified natural gas exports from new projects would be short-lived and would not alter the industry’s meteoric growth.

In less than a decade, the U.S. has become the world’s largest LNG exporter as production of the commodity and construction of export terminals has boomed. LNG is natural gas cooled into liquid form to make it easier to transport.

U.S. exports have provided European allies with energy security as they seek to end their dependence on Russian gas in the wake of Moscow’s invasion of Ukraine. Industry executives argue LNG will play a key role in the energy transition by displacing coal for electricity generation.

The Department of Energy announced a pause on exports from new projects in January to evaluate the impact the LNG surge has had on the climate, energy security and domestic prices.

“This pause on new LNG approvals sees the climate crisis for what it is: the existential threat of our time,” President Joe Biden said after the January announcement.

Secretary of Energy Jennifer Granholm indicated in Houston on Monday that the pause would be relatively short-lived.

“I predict that as we sit here next year … this will be well in the rearview mirror,” Granholm told the CERAWeek by S&P Global energy conference in reference to the LNG export pause.

The energy secretary reiterated the pause has no impact on the 48 billion cubic feet per day that is currently authorized for export. This includes 14 billion cubic feet per day that is currently exported, another 12 Bcf/d under construction and 22 Bcf/d that is authorized but has not received final investment decisions.

The 48 Bcf/d of currently authorized LNG is three times the current export capacity of the U.S., according to the Department of Energy.

Industry pushback

Oil and gas executives and Republican senators, however, were unmoved by Granholm’s remarks, arguing the pause would shake confidence among investors evaluating new projects, rattle allies who depend on U.S. LNG and potentially undermine the transition to cleaner energy sources.

“The pause is climate unfriendly, economically unfriendly, and security unfriendly. There’s no reason to have the pause,” John Hess, the CEO of oil and gas producer Hess Corp., told CERAWeek on Tuesday.

“We can’t flip-flop our policy,” Hess said. “We can do any study we want, but you don’t make a pause, you don’t make a freeze — do the study in parallel,” he said.

Hess said gas will play a key role in the energy transition, particularly in countries like China where coal supplies 60% of electricity generation. “The only way to get those numbers down is to replace it with gas,” the CEO said.

Oil Prices, Energy News and Analysis

Baker Hughes CEO Lorenzo Simonelli indicated the U.S. could fall behind its competitors if the pause goes on longer than eight to 12 months because international projects will simply move forward. Qatar, one of the world’s top LNG exporters, is planning a major expansion of its production.

Clay Neff, Chevron’s president of international exploration and production, said Wednesday that the LNG pause could shake investor confidence.

Sen. Dan Sullivan, R-Alaska, said U.S. allies were worried about the LNG pause during conversations at the Munich Security Conference in February. Europe was the destination for 67% of U.S. LNG exports in the first half of 2023, according to the Energy Information Administration.

The senator sent a letter to President Biden’s climate advisor, John Podesta, on Monday calling for the administration to lift the pause.

“It’s having serious consequences with regard to our national security and the national security of our allies,” Sullivan said during a press conference Monday at CERAWeek, arguing the policy contradicts U.S. efforts to help European nations end their dependence on Russian energy.

Sullivan told Podesta in the letter that the pause would cede market share to countries like Russia and Qatar. The U.S. supplied 48% of European LNG imports last year, while Qatar provided 14% and Russia 13%, according to data from the EIA.

The pause includes an exception for unanticipated and immediate national security emergencies, according to the White House. The Biden administration is committed to the strongest possible energy supply relationship between the U.S. and Europe, said Geoffrey Pyatt, assistant secretary for energy resources at the U.S. State Department.

“First of all, there’s going to be no rollback of current capacity,” Pyatt said of the LNG pause at CERAWeek on Tuesday. “Moreover, there is a massive increment of additional capacity coming onto the market.”

“There is a profound understanding of the strategic benefit that comes from American energy exports,” Pyatt said of the Biden administration’s position.

Don’t miss these stories from CNBC PRO:

Environment

Amazon, Google and Meta support tripling nuclear power by 2050

Published

4 hours ago

March 12, 2025

admin

Amazon, Google and Meta support tripling nuclear power by 2050

Google, Meta, and Amazon join forces to boost nuclear energy by 2050

HOUSTON — Amazon, Alphabet’s Google and Meta Platforms on Wednesday said they support efforts to at least triple nuclear energy worldwide by 2050.

The tech companies signed a pledge first adopted in December 2023 by more than 20 countries, including the U.S., at the U.N. Climate Change Conference. Financial institutions including Bank of America, Goldman Sachs and Morgan Stanley backed the pledge last year.

The pledge is nonbinding, but highlights the growing support for expanding nuclear power among leading industries, finance and governments.

Amazon, Google and Meta are increasingly important drivers of energy demand in the U.S. as they build out artificial intelligence centers. The tech sector is turning to nuclear power after concluding that renewables alone won’t provide enough reliable power for their energy needs.

Amazon and Google announced investments last October to help launch small nuclear reactors, technology still under development that the industry hopes will reduce the cost and timelines that have plagued new reactor builds in the U.S.

Meta issued a call in December for nuclear developers to submit proposals to help the tech company add up to four gigawatts of new nuclear in the U.S.

The pledge signed Wednesday was led by the World Nuclear Association on the sidelines of the CERAWeek by S&P Global energy conference in Houston.

Environment

French industrial giant Schneider Electric hails the significance of China’s ‘DeepSeek moment’

Published

6 hours ago

March 12, 2025

admin

French industrial giant Schneider Electric hails the significance of China’s ‘DeepSeek moment'

Schneider Electric chairman says China’s DeepSeek breakthrough is ‘very good’ news

China’s so-called “DeepSeek moment” is likely to be good news in the global race to develop artificial intelligence models that can carry out more complex tasks, according to Jean-Pascal Tricoire, chairman of French power-equipment maker Schneider Electric.

“I actually think its good news. We need AI at every level,” Tricoire told CNBC’s Steve Sedgwick at CONVERGE LIVE in Singapore on Wednesday.

“We need AI to optimize your whole enterprise at all levels, so that you can buy better, consume better, decide better, source better. To do all of this, we need models to operate on a smaller scale,” he added.

Tricoire said the emergence of Chinese AI app DeepSeek showed that AI models can achieve the same results as some of its more established U.S. rivals, but with a much smaller model.

It “will actually spread AI at all levels of the architecture much faster,” Tricoire said. He added that DeepSeek’s blockbuster R1 model would be “fantastic” for improving safety and reliability when deploying AI on dangerous equipment.

“The spread of AI models at every level of what we need is actually very good news,” Tricoire said.

His comments come shortly after Schneider Electric reported record sales and profits in 2024.

The company, which has been a big beneficiary of the artificial intelligence trend, raised its 2025 profit margin following robust fourth-quarter demand for data centers.

Shares of Schneider Electric rose 33% in 2024, following a 39% upswing in 2023. The Paris-listed stock is down around 7% year to date, however, with China’s recent AI push sparking concerns about AI investment and tech sector returns.

Data centers, which consume an ever-increasing amount of energy, represent a key piece of infrastructure behind modern-day cloud computing and AI applications.

— CNBC’s Ganesh Rao contributed to this report.

Environment

Ailing Swedish EV battery firm Northvolt files for bankruptcy

Published

6 hours ago

March 12, 2025

admin

Ailing Swedish EV battery firm Northvolt files for bankruptcy

A Northvolt building in Sweden, photographed in February 2022.

Mikael Sjoberg | Bloomberg | Getty Images

Struggling electric vehicle battery manufacturer Northvolt on Wednesday said it has filed for bankruptcy in Sweden.

The firm said it that it submitted the insolvency filing after an “exhaustive effort to explore all available means to secure a viable financial and operational future for the company.”

“Like many companies in the battery sector, Northvolt has experienced a series of compounding challenges in recent months that eroded its financial position, including rising capital costs, geopolitical instability, subsequent supply chain disruptions, and shifts in market demand,” Northvolt noted.

“Further to this backdrop, the company has faced significant internal challenges in its ramp-up of production, both in ways that were expected by engagement in what is a highly complex industry, and others which were unforeseen.”

Northvolt’s collapse into insolvency deals a major blow to Europe’s ambition to become self-sufficient and build out its own EV battery supply chain to catch up to China, which leads as the world’s largest market for electric vehicles by a wide margin.

The Swedish battery firm had been seeking financial support to continue its operations amid an ongoing Chapter 11 restructuring process in the United States, which it kicked off in November.

“Despite liquidity support from our lenders and key counterparties, the company was unable to secure the necessary financial conditions to continue in its current form,” Northvolt said Wednesday.

Northvolt said a Swedish court-appointed trustee will oversee the company’s bankruptcy process, including the sale of the business and its assets and settlement of outstanding obligations.