Page 21 - EurOil Week 09 2023

EurOil POLICY EurOil

Eni CEO says Africa is a key source of gas

supplies to replace Russia in Europe

AFRICA CLAUDIO Descalzi, the CEO of Italy’s Eni, has half of its Russian volumes is accurate, the Italian
said that he sees Africa as a vital source of natu- major has secured the equivalent of around 14.5
Eni has already ral gas for Europe as the Continent attempts to bcm per year from other suppliers.)
succeeded in replacing reduce its dependence on supplies from Russia The CEO pointed out that his company had
half of the Russian gas in response to the latter country’s invasion of expended a great deal of effort over the last 12
it had been importing Ukraine. months to expand the scope of its relationships
into Italy. Descalzi was quoted as saying in a press with existing gas suppliers such as Algeria and
release outlining Eni’s results in the fourth to initiate deliveries from new suppliers such as
quarter of 2022 that Eni had already suc- Mozambique. “During the year, we were able to
ceeded in replacing 50% of the Russian gas finalise agreements and activities to fully replace
it had been importing into Italy from Russia, Russian gas by 2025, leveraging our strong rela-
with most of the new supplies coming in from tionships with producing states and fast-track
North and West Africa. He did not identify development approach to ramp up volumes
any individual importers or provide a full from Algeria, Egypt, Mozambique, [Republic
breakdown of the company’s supply sources, of] Congo and Qatar,” he was quoted as saying
but he did state that Eni expected to replace in the press release.
all of its Russian gas deliveries with African These initiatives can be expected to bene-
shipments by 2025. fit both Italy and the broader European energy
Prior to the outbreak of war in Ukraine in late market, he added. “In 2022, Eni was not only
February of last year, Eni was importing about engaged in progressing its sustainable energy
40% of Italy’s gas from Russia, he noted. (Accord- transition goals, but also in ensuring the secu-
ing to previous reports, Russian gas deliveries to rity and stability of energy supplies to Italy and
Italy amounted to 29bn cubic metres per year. As Europe, building up a diversified geographic mix
such, if Descalzi’s statement that Eni has replaced of energy sources,” he commented. ™
ENERGY TRANSITION

Fossil fuel consumption subsidies in 2022

were at record high of $1 trillion

GLOBAL ACCORDING to the International Energy low-emissions alternatives.
Agency (IEA), worldwide subsidies for fossil fuel The finding of the report underlines the prob-
The surge was the consumption increased dramatically in 2022, lem of governments dealing with high fuel infla-
result of market surpassing $1 trillion for the first time. tion, while still trying to encourage the energy
volatility. This surge in subsidies was caused by energy transition. The fossil fuel spending by world
market turbulence, which led to international governments in 2022 – not just consumption
fuel prices soaring well above what many con- subsidies but total spending – was more than
sumers paid. Consumption subsidies are energy twice the total investment in renewable energy
price cuts for consumers, for example setting sources, according to BloombergNEF.
fixed prices of retail gasoline. These rising consumption subsidies indeed
The 2022 subsidies, driven by the global contrast sharply with the Glasgow Climate Pact,
energy crisis resulting from Russia’s invasion of which called for countries to phase out inefficient
Ukraine, were twice the levels seen in 2021 and fossil fuel subsidies while providing targeted
almost five times those in 2020. This is according support to the poorest and most vulnerable.
to the IEA in a just published report, Fossil Fuel The November 2021 Glasgow Climate Pact
Consumption Subsidies 2022. effectively proposed to accelerate efforts to close
However, the IEA found that the govern- the 2030 emissions gap by asking countries to
ment measures taken to protect consumers align their commitments with Paris Agree-
were not well-targeted, and although they may ment goals and with a just transition to net zero,
have helped to alleviate the impact of skyrock- according to the World Resources Institute.
eting costs, they artificially maintained the The pact called on countries to “phase
competitiveness of fossil fuels compared with out … inefficient fossil fuel subsidies, while

Week 09 03•March•2023 www. NEWSBASE .com P21