US Backs Poland Gas Hedging, Drawing Climate Activists’ Ire
(Bloomberg) -- The US International Development Finance Corp. pledged up to $500 million to help increase Poland’s natural gas imports — appearing to contravene a Biden administration commitment to halt public finance for foreign fossil-fuel projects.
The bank’s Board of Directors approved a plan to guarantee the payment obligations of state-controlled energy company PKN Orlen SA to Goldman Sachs Bank Europe SE for liquefied natural gas hedging activities, according to a notice online. The goal is to “facilitate higher volumes of US LNG imports” by the Eastern European nation, according to a Development Finance Corp. summary of the project.
The decision drew condemnation from environmentalists who say it bucks President Joe Biden’s promises to combat climate change and disregards several formal US commitments to stop backing foreign oil, gas and coal projects. The Group of Seven nations last year vowed to “end new direct public support for the international unabated fossil fuel energy sector by the end of 2022,” except in “limited circumstances.”
“This puts the US international reputation and its position as a so-called climate leader on the line,” said Collin Rees, US program co-manager at Oil Change International.
The approval follows a series of administration decisions on energy that have sowed frustration among environmentalists who helped elect Biden in 2020 — including approval of ConocoPhillips’s Willow oil development in Alaska and provisions in the debt-ceiling deal intended to accelerate construction of Equitrans Midstream Corp.’s Mountain Valley gas pipeline.
The Development Finance Corp. said the Goldman Sachs guarantee would help Poland reduce the carbon intensity of its energy portfolio as it moves away from dirtier coal-fired power. The bank also concluded it was a business activity with minimal environmental concerns. The loan guarantee’s half-billion-dollar size is similar to the scale of financing the DFC is providing for a solar manufacturing venture in India that’s drawn widespread support.
A senior DFC official who asked for anonymity to speak about non-public deliberations said the guarantee was consistent with American goals to reduce the European Union’s reliance on Russian energy, including by diversifying its natural gas supplies. The US and EU established a joint task force to focus on the issue in the wake of Russia’s invasion of Ukraine, with a goal of ensuring demand for 50 billion cubic meters of American LNG until at least 2030.
“This is enabling gas exports,” said Jake Schmidt, a senior strategic director at the Natural Resources Defense Council. “And it’s a failure of US leadership to lead with a clean energy agenda.”
Advocates of the project say Poland and its state-owned energy company should be applauded for jettisoning Russian gas and for negotiating long-term contracts to buy liquid natural gas from US export facilities. In January, the company signed a purchase agreement for 1 million tons annually of the fuel from Sempra Energy’s Port Arthur LNG export facility being developed in Texas.
(Updates with notice of approval, in second paragraph.)
©2023 Bloomberg L.P.
KEEPING THE ENERGY INDUSTRY CONNECTED
Subscribe to our newsletter and get the best of Energy Connects directly to your inbox each week.
By subscribing, you agree to the processing of your personal data by dmg events as described in the Privacy Policy.
More renewables news
![BloomburgMedia_SH40SLT0G1KW00_25-07-2024_09-26-50_638574624000000000.jpg](/media/orol425i/bloomburgmedia_sh40slt0g1kw00_25-07-2024_09-26-50_638574624000000000.jpg?anchor=center&mode=crop&width=240&height=135&rnd=133663732110870000&format=webp)
Vessel Firm’s $700 Million Takeover Targets Wind’s Ship Shortage
![Nordex](/media/d0gf3pte/nordex.jpg?anchor=center&mode=crop&width=240&height=135&rnd=132749588018400000&format=webp)
Nordex Group upgrades guidance after strong H1 2024 performance with 25% sales increase
![Totalenergies (5)](/media/2jrkcvan/totalenergies.jpg?anchor=center&mode=crop&width=240&height=135&rnd=132942325437870000&format=webp)
TotalEnergies launches new 100 MW/200 MWh battery storage development in Germany
![Totalenergies](/media/41ojyade/totalenergies.jpg?anchor=center&mode=crop&width=240&height=135&rnd=132881916816700000&format=webp)
TotalEnergies acquires a stake in the OranjeWind offshore wind farm in the Netherlands
![Battery Storage (1)](/media/bedjsnil/battery-storage.jpg?anchor=center&mode=crop&width=240&height=135&rnd=132953656215970000&format=webp)
EWEC issues request for proposals for the development of 400MW battery energy storage system
![BloomburgMedia_SGH4U3T0AFB400_24-07-2024_20-00-09_638573760000000000.jpg](/media/4zujntna/bloomburgmedia_sgh4u3t0afb400_24-07-2024_20-00-09_638573760000000000.jpg?anchor=center&mode=crop&width=240&height=135&rnd=133663248098100000&format=webp)
Refining Woes Hit Big Oil as Pressure Rises on Investor Returns
![Hydrogen Image (1)](/media/ouhfwhgg/hydrogen-image-1.jpg?anchor=center&mode=crop&width=240&height=135&rnd=133093644996330000&format=webp)
EnBW to invest €1 billion in national hydrogen core network in Germany
![BloomburgMedia_SH2XDFT0AFB400_24-07-2024_09-00-10_638573760000000000.jpg](/media/jmmhvoyf/bloomburgmedia_sh2xdft0afb400_24-07-2024_09-00-10_638573760000000000.jpg?anchor=center&mode=crop&width=240&height=135&rnd=133662852101070000&format=webp)
GE Vernova Now Must Explain Broken Wind Turbine to Investors
![BloomburgMedia_SGTQ8GDWX2PS00_23-07-2024_20-00-09_638572896000000000.jpg](/media/obyb3qfl/bloomburgmedia_sgtq8gdwx2ps00_23-07-2024_20-00-09_638572896000000000.jpg?anchor=center&mode=crop&width=240&height=135&rnd=133662384097370000&format=webp)
SunPower Plunges After Halting Installs and Shipments
![BloomburgMedia_SH0RSNDWRGG000_22-07-2024_16-00-09_638572032000000000.jpg](/media/wyjmxear/bloomburgmedia_sh0rsndwrgg000_22-07-2024_16-00-09_638572032000000000.jpg?anchor=center&mode=crop&width=240&height=135&rnd=133661376098470000&format=webp)
American Farmers’ Next Hot Commodity Is Canola for Biofuels
![CSIS Thumbnail](/media/o0acqjyg/csis_thumbnail.jpg?anchor=center&mode=crop&width=540&height=300&rnd=133566075809700000&format=webp)
CSIS: long-term LNG demand to reshape global export capacity growth
![Dr Carole Nakhle Thumbnail](/media/gqrpjths/dr-carole-nakhle_thumbnail.png?anchor=center&mode=crop&width=540&height=300&rnd=133542056370600000&format=webp)
More women in energy vital to the industry’s success
![Vandana Hari Thumbnail](/media/gz3dyktl/vandana-hari-thumbnail.jpg?anchor=center&mode=crop&width=540&height=300&rnd=133511540022930000&format=webp)
India’s energy sector presents lucrative opportunities for global companies
![OIL INDIA Thumbnail (1)](/media/oddlww2x/oil-india-thumbnail-1.jpg?anchor=center&mode=crop&width=540&height=300&rnd=133506537128730000&format=webp)
Oil India charts the course to ambitious energy growth
![DNV Thumbnail](/media/chkphnjn/dnv-thumbnail.png?anchor=center&mode=crop&width=540&height=300&rnd=133491856590700000&format=webp)
Maritime sector is stepping up to the challenges of decarbonisation
Partner content
![Navigating the trading seas: exploring the significance of benchmarks-1859882229](/media/qlacaiww/navigating-the-trading-seas-exploring-the-significance-of-benchmarks-1859882229.jpg?anchor=center&mode=crop&width=540&height=300&rnd=133613577584600000&format=webp)
Navigating the trading seas: exploring the significance of benchmarks
![New Lng Ship Web 17829](/media/vjrjyypa/new-lng-ship-web-17829.jpg?anchor=center&mode=crop&width=540&height=300&rnd=133179936218300000&format=webp)
Back to the Future(s): the best commodities benchmarks are still physically settled
![Dr Klaus](/media/4eyh2dr0/dr-klaus.jpg?center=0.3953747239980292,0.50683017007953435&mode=crop&width=540&height=300&rnd=133517897092430000&format=webp)
Ebara Elliott Energy offers a range of products for a sustainable energy economy
![ESSAR](/media/5uafghtj/essar.jpg?anchor=center&mode=crop&width=540&height=300&rnd=133524466961070000&format=webp)
Essar outlines how its CBM contribution is bolstering for India’s energy landscape
![HNC 7611 V2](/media/0dqbya15/hnc_7611_v2.jpg?anchor=center&mode=crop&width=540&height=300&rnd=133517899616530000&format=webp)