Latest News

EU waives penalties against oil and gas companies that violate methane laws

Following pressure from the U.S. Government to roll back rules, the European Commission has instructed EU governments that penalties will be waived for three years by oil and gas companies who 'breach their methane emission law. In recent months, the U.S. and?Qatar oil and gas industry?groups and most EU members states demanded that changes be made to the law, warning it would hinder Europe's ability in securing fuel supplies when imported gas is required to meet emission monitoring standards equivalent to Europe's from January 2027.

In order to "avoid supply disruptions", the?Commission stated on Monday that EU countries should not impose penalties on companies who violate the?methane laws in 2027 2028 and 2029. Companies that did not comply with the law could be fined up to 20% their annual revenue. The Commission stated that the?changes are justified in the context of tightening global energy markets caused by the?ongoing?blockade of Strait?of Hormuz", disrupting the transit route of a fifth of world's oil & liquefied gas supply. This change will weaken the EU's first ever climate policy that was intended to curb methane leaks, a powerful greenhouse gas, and the second largest cause of climate changes after CO2 emissions. It does not go quite as far as critics would like, since it doesn't amend the law but only temporarily waives the penalties for violating it. A group of 17 EU member states, including Germany, the Czech Republic and others, has asked the EU to postpone the law. Analysts disagree on whether or not the new rules will limit the amount of oil and gas that the EU can obtain from global markets. The "recommendation of the Commission" regarding waivers of penalties is not binding, but it instructs countries on how to apply EU laws. A Commission official said on Monday that national courts were obliged to consider the recommendation, which would help businesses avoid any claims of being penalized for breaking the law. (Reporting and editing by Toby Chopra; Reporting by Kate Abnett)

(source: Reuters)