Page 4 - EurOil Week 30

EurOil COMMENTARY EurOil
Kent Johansson/Dreamstime
EIB eyes exit from energy projects
The lender will not back any fossil fuel plans from 2021 onwards
WHAT:
EIB is getting out of the hydrocarbons business, including LNG.
WHY:
The bank is determined to play its part in meeting the Paris climate accord goals.
WHAT NEXT:
Despite this, Europe is increasingly keen on imported LNG.
THE European Investment Bank (EIB) may end its support for energy projects relying on fossil fuels. e bank has been a mainstay of lending to liquid natural gas (LNG) import projects in the region and – should it follow through with its decision – it will have an impact on future capacity.
e EIB has been linked to a number of pro- posed LNG import projects, including Ireland’s Shannon LNG project and Tenerife’s Granadilla LNG, in addition to pipelines to provide further connectivity to terminals, such as a link from Poland’s Świnoujście and the Interconnector Greece-Bulgaria (IGB) pipeline. It was also involved in providing an €87mn ($97mn) loan for the Lithuanian terminal project.
In October 2018, the EIB said it was support- ing plans for a network of LNG and compressed natural gas (CNG) fuelling stations in Italy, under an agreement with SNAM.
The plan
e institution said its new lending policy had been dra ed with an eye on the Paris accord and, in order to accomplish this, it would “phase out support to energy projects reliant on fossil fuels”. ese projects will not be approved for funding a er the end of 2020, it said in its dra
energy lending policy, published last week. LNG terminals and storage have been ruled out, it said, although there is still scope for low-carbon feedstocks such as biogas and syn-
thetic gas.
is is a signi cant departure from its 2013
policy. is said supporting gas transmission and LNG projects were “high priority invest- ments”. Providing support to this sector was intended to help the EU market become more liquid and competitive, in addition to delivering supply diversi cation and security.
e new dra noted that fossil fuels would continue to play a role in the world’s energy needs until 2030 and also that moving from coal or oil to gas might reduce greenhouse gas (GHG) emissions in the short term. Investment in these plans is likely to take place with or with- out EIB funds, it said.
e decision for it to move away from fossil fuels will allow it to focus “its limited resources on investments needed to meet the EU 2030 targets and 2050 objectives, which present high investment needs, a longer-term perspective and a greater investment challenge”.
While not supporting fossil fuel use, it will continue providing support for electricity networks.. 
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w w w . N E W S B A S E . c o m Week 30 01•August•2019