Good Morning. This is the Sunya Scoop. The newsletter that takes energy transition news and turns it into an easy-to-read email for you.
Bringing this OG meme back
Here’s what we have for you today:
OIL AND GAS
Talent crisis in the oil industry as young workers are not interested despite plentiful jobs and high salaries
Pool of new entrants for petroleum-engineering programs at U.S. colleges and European universities is shrinking
Concerns about industry’s role in climate change and long-term job security in transition away from fossil fuels
Number of petroleum-engineering graduates decreased by more than half between 2016 and 2021
Undergraduate petroleum-engineering enrollments dropped 75% since 2014
Source: WSJ
Students attracted by other engineering possibilities as industry transitions to different energy sources
Oil-and-gas companies offering fellowships and programs to cultivate new talent
Focus on dynamic and creative aspects of the industry such as carbon capture and geothermal projects
Competition from startups and fast-growing companies in clean energy fields
Industry needs to articulate energy transition strategies to attract workers
Talent shortage affects efforts to curb emissions and develop clean-energy businesses
Universities ending or rebranding petroleum engineering degrees in response to changing demand
Steady flow of talent crucial for infrastructure development and innovation in the industry
No shocker here—Gen Z showing less love for the oil and gas scene. Time to amp up that energy advocacy game, folks.
We’re talking about snagging that top-tier US oil and gas with enviro-friendly standards, meeting energy needs, and riding the wave of global demand. But hold up, it’s not just about the black gold—carbon capture and geothermal are on the menu too.
And guess what? A bunch of those energy transition ventures need good ol’ petroleum engineering chops. So, if we’re serious about hitting that net zero target, you bet your bottom dollar we’re gonna need that talent in the mix.
If you’re looking for a book to recommend, check out Harold Hamm’s Game Changer (Not sponsored. I promise.)
CARBON CAPTURE
The North Dakota Public Service Commission rejected Summit Carbon Solutions’ permit application for a 320-mile pipeline to transport captured carbon dioxide from ethanol plants to an underground storage site.
Summit Carbon Solutions, along with Navigator CO2 Ventures and Wolf Carbon Solutions, aims to build Midwest carbon pipelines to decarbonize the ethanol sector and demonstrate carbon capture and storage (CCS).
The commission stated that Summit failed to prove that the project would have minimal adverse effects on the environment and the citizens of North Dakota.
Summit respects the decision and plans to reapply for a permit in the state.
Concerns from North Dakota residents included potential damage to farmland, property values, and safety issues related to transporting and storing carbon dioxide.
The Sierra Club in Iowa, opposing carbon pipelines, views this decision as significant and hopes it will influence similar disputes in other states.
Summit intended to store up to 18 million tons of CO2 annually in a North Dakota storage site and had secured easement agreements with 375 landowners for 70% of its pipeline route.
We’re confident that this will eventually get resolved, but for now, it’s a bit of a setback. The ongoing challenge of advancing infrastructure projects in our country persists, whether we’re talking about CO2, natural gas, or even transmission lines.
LOW-CARBON FUELS
Phillips 66 and Archer-Daniels-Midland (ADM) are in talks for a biofuels joint venture focused on producing lower-carbon jet fuel
Oil and corn-based ethanol industries are collaborating to produce lower-carbon biofuels
Discussions involve putting ADM’s dry corn mill operations into the venture to convert grain-based alcohol to jet fuel
ADM, a top U.S. ethanol producer, is downsizing its role and has spun off its dry corn mills
Phillips 66 plans to produce renewable fuels, including jet fuel, at a converted California refinery
Several U.S. states have established low-carbon fuel markets that reward producers for developing fuels with lower carbon emissions
Axens SA provides ethanol-to-fuels conversion technology, contributing to the venture’s plans
ADM previously formed a renewable diesel joint venture with Marathon Petroleum Corp
Other companies like Bunge and Chevron have also formed joint ventures to make renewable fuels from soybeans and canola
NATURAL GAS AND LNG
Woodside Energy Group has entered a deal with LNG Japan to sell a 10% participating interest in its $12 billion Scarborough liquefied natural gas (LNG) project in Australia for $500 million
Woodside will retain a 90% interest and continue as the operator after the deal’s completion, expected in Q1 2024
The Scarborough project will feed gas into Woodside’s Pluto LNG plant, with the first LNG cargo targeted for 2026
The development of the Scarborough gas field and expansion of the Pluto LNG plant is Woodside’s biggest growth project
Woodside and LNG Japan have also agreed on the sale and purchase of 12 LNG cargoes per year for 10 years starting 2026
LNG Japan is a joint venture between Sumitomo Corp and Sojitz Corp
Woodside also plans to collaborate with Sumitomo and Sojitz on global opportunities in new energy such as ammonia, hydrogen, and carbon capture and storage
The move is seen positively by analysts, as it helps de-risk Woodside’s exposure to Scarborough and reduces future development expenditure and technical risk
Persisting pattern of divesting non-operated interests through partnerships and joint ventures, given the current scenario of low oil and gas prices coupled with high interest rates.
RENEWABLES
Wind industry facing crisis due to rising prices and logistical issues
Developers and buyers scrapping contracts, delaying projects, and postponing investments
Over $30 billion in planned spending delayed for offshore wind projects in the U.S. and Europe
European offshore wind projects hit by setbacks due to cost increases and delays
Offshore wind targets for 2030 likely to be missed for Biden administration and European governments
President Biden aims for 30 gigawatts of offshore wind power this decade
Challenges include inflation, supply-chain backlogs, rising interest rates, and permitting delays
Avangrid pays $48 million to exit offshore wind deal due to changing conditions
European countries accelerate offshore wind plans while supply costs rise
Short-term challenges for industry; long-term potential remains promising
Wind installations on land halved in Q1 compared to last year
Manufacturers facing profitability issues due to larger and more advanced machines
Siemens Energy estimates up to $1.75 billion in costs for turbine quality issues
Blade supplier TPI Composites issues profit warning due to higher inspection and repair costs
METHANE REDUCTION
Canadian dairy farmer Ben Loewith is breeding calves with a low-methane genetic trait to reduce methane emissions from cattle
Semex, a genetics company, offers bull semen with a low-methane trait that could decrease emissions from Canada’s dairy herd by 1.5% annually, potentially up to 20%-30% by 2050
The low-methane trait could have a significant global impact on cattle emissions
Low-methane breeding could be a more permanent and cumulative solution compared to feeding additives to cattle
Some dairy industry officials express concerns about low-methane breeding causing digestive problems in cattle
Methane is a significant greenhouse gas produced by microbes in cattle’s guts during digestion
Research involved capturing cattle’s breath to measure methane and comparing data with genetic information and milk samples
While the Canadian government does not currently provide incentives for low-methane cattle breeding, it’s working on offset credits for methane reduction
Some countries and food companies are addressing methane emissions in their supply chains by changing cattle diets
Genetic changes from low-methane breeding could have a significant long-term impact on emissions.
Don’t see them adding this to the menu at Pappas off Westheimer anytime soon.
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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.