Eutelsat Raises €1.35 Billion Led by France to Aid OneWeb
The French government will invest €717 million in Eutelsat, the Finance Ministry said in a statement on Thursday. The investment takes France's stake to almost 30%. Existing investors including Fonds Stratégique de Participations, French shipping company CMA CGM and Bharti Space will also participate in the round, which will be completed by year end, Eutelsat said in a separate statement.
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Qatar's LNG Warning Highlights Europe's Fragile Energy Strategy
The race has been on to secure new liquefied natural gas (LNG) supplies for Europe since Russia invaded Ukraine on 24 February 2022. LNG at that point became the key global emergency energy source as it is quick to secure and to move, unlike pipelined energy that requires time-consuming infrastructure build-out and contract negotiations before it can be moved anywhere. Europe was especially in need of such supplies to compensate for the energy it has bought for decades from Russia without questioning Moscow's long-term strategic motivation for offering such enormous quantities of cheap gas and oil. This was simply to ensure minimal pushback from Europe when President Vladimir Putin began his long-flagged objective to recapture those parts of Europe that were once part of the U.S.S.R., as analysed in full in my latest book on the new global oil market order. 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The new rules will ensure that companies in scope identify and address adverse human rights and environmental impacts of their actions inside and outside Europe.' It further requires firms to integrate sustainability into their core business strategies, address impacts on the environment and society, and establish transition plans aligned with the Paris Agreement's climate goals. All this is focused on European Union (E.U.) companies with over 1,000 employees and a worldwide turnover exceeding EUR450 million (USD514 million), and non-E.U. companies with a turnover exceeding EUR450 million within the E.U. Failure to adhere to some of its sharper strictures can results in extremely severe punishments for transgressors. One particularly eye-catching punishment is that companies found in breach of these conditions can be fined up to 5% of their global turnover or be required to compensate affected individuals and communities. Unsurprisingly, for those countries in a more emerging stage of development than those who drafted the law (that is, nearly most of the major oil and gas suppliers around the world), some of these conditions are problematic. For Qatar, they are apparently infuriating, with its Minister of State for Energy Affairs Saad al-Kaabi calling the legislation 'ridiculous' at a forum in Doha in December. He also threatened at that point to end all LNG supplies to the E.U. if any of his country's companies were subject to penalties by dint of the CSDDD. Matters have now escalated, according to a senior E.U. security source spoken to by last week, with a letter from al-Kaabi to the European Commission (the executive branch of the E.U.) reiterating the threat of cut-off from Qatar's LNG supplies if the Directive is not modified to ensure that its companies do not face any penalties. Equally unsurprisingly, according not the E.U. source, Europe is taking this threat very seriously. 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Indeed, China concluded several major LNG deals with Qatar a year before, beginning with the signing of a 10-year purchase and sales agreement by the China Petroleum & Chemical Corp (Sinopec) and Qatar Petroleum (QP) for 2 million metric tonnes per annum (mtpa) of LNG, and multiple similar deals followed. However, following hard negotiations with the U.S., May 2022 saw Qatar sign a declaration of intent on energy cooperation with Germany aimed at becoming its key supplier of LNG. These plans would run in parallel with, but were likely to be finished significantly sooner than, the plans for Qatar to also make available to Germany sizeable supplies of LNG from the Golden Pass terminal on the Gulf Coast of Texas. QatarEnergy holds a 70% stake in the project, with the U.S.'s ExxonMobil holding the remainder. Following on from these developments, December 2022 saw two sales and purchase agreements signed between QatarEnergy and the U.S.'s ConocoPhillips to export LNG to Germany for at least 15 years from 2026. As of now, Qatar remains a major LNG supplier to the E.U. – its third largest, in fact – having shipped around 10 million metric tonnes of the gas to the continent last year. As one of these three is Russia (in number two position, after the U.S.) – and the E.U. is considering phasing out all Russian LNG and gas entering it by the end of 2027 – Qatar's share was set to rise dramatically. This dovetails with the country's own plans to more than double its current 77 million mtpa production to 160 million mtpa by 2030. By that time, it will account for at least 40% of all new LNG supplies across the globe, making it even more of crucial energy and geopolitical ally to the West, and to China, Russia, and countries in their sphere of influence. Such a situation would leave the U.S. with a huge supply gap to fill very quickly, although industry projections are that its LNG supply will increase by at least 75 million mtpa (from over 90 million mtpa currently) by 2030. This would also accord with the recent E.U. pledge to buy USD750 million of U.S. energy in the next three years, with much of this increase expected to come from the LNG sector. That said, the E.U. may be at least as concerned by the fact that it would leave Europe's emergency energy supply almost entirely in the hands of Washington. Given President Donald Trump's comments about not even helping to defend fellow European NATO members from attack – as the U.S. is obliged to do by Article 5 of the Treaty -- if they do not increase their defence spending to what he considers a sufficient level, the E.U.'s leadership may ponder whether he would take the same view on the U.S.'s commitment to energy supplies to the continent as well should it be attacked by Russia. In short, the loss of Qatari LNG to Europe – and more supplies going to China -- would be catastrophic for Europe – and indeed for the broader Western Alliance even now. And it would be considerably worse if Beijing launches its own 'Special Military Operation' to 'reunite' Taiwan with its 'rightful motherland' mainland China in 2027 – the date Chinese President Xi Jinping has told his military to prepare for. By Simon Watkins for More Top Reads From this article on
