Chevron, the leading oil and natural gas giant’s Q2 results indicated a decline in performance. The company’s profits fell due to operational and market challenges, reflecting the difficulties it faced during the quarter. However, its global production increased. But how about its emissions and zero goals? Let’s discover

Chevron’s Profits Decline Amid Production Growth

Chevron Corporation’s second-quarter 2024 earnings totaled $4.4 billion, a decrease from $6.0 billion in the same period in 2023. Simply put, the company’s profit slumped 19% this year.

CEO Michael Wirth said, “This quarter was a little light due to some operational and other discrete items that impacted results.”

This drop reflects reduced margins on refined product sales, the absence of favorable tax items, and adverse foreign currency effects that substantially reduced earnings by $243 million. Adjusted earnings were $4.7 billion ($2.55 per share), compared to $5.8 billion ($3.08 per share) last year.

Despite this, Chevron saw a notable 11% increase in global production, driven by the successful integration of PDC Energy and strong performance in the Permian and DJ Basins. The company also expanded its exploration footprint through agreements in Namibia, Brazil, Equatorial Guinea, and Angola.

In terms of financial activities, Chevron allocated $6.0 billion to shareholders during the quarter, including $3.0 billion in dividends and $3.0 billion in share repurchases. Cash flow from operations remained steady, supported by higher dividends from equity affiliates and reduced working capital.

Looking ahead, Chevron’s upcoming dividend of $1.63 per share underscores its commitment to returning value to shareholders amid operational growth and strategic expansions in key global markets.

Reuters reported that Chevron is counting on the Hess acquisition to secure a foothold in Guyana, which holds the largest oil discovery in nearly two decades. Subsequently, the company also aims for the deal to offset risks from its underperforming oil projects in Australia and Kazakhstan, where operational issues have again affected production and delayed maintenance work into the third quarter.

MUST READ: Chevron Finds Global Carbon Pricing Key for Low-Carbon Investments

Is Chevron’s Emission Reduction Plan Enough?

Chevron plans to allocate $8.0 billion to lower carbon energy investments from 2021 through 2028. This includes renewable fuels, carbon capture, offsets, hydrogen, and advanced technologies to enhance production and supply capabilities Additionally, the company will invest $2.0 billion in carbon reduction projects over the same period.

In 2023, Chevron’s emissions amounted to 745 million metric tons of carbon dioxide equivalent (MtCO₂e). Quite sadly, Chevron’s emissions had been steadily rising.

Image: Annual greenhouse gas emissions released by Chevron from 2016 to 2023 (in million metric tons of CO₂ equivalent)

Chevron’s Net Zero 2050 Aspiration

Chevron aims for net zero upstream Scope 1 and 2 greenhouse gas emissions by 2050 on an equity basis. Achieving this goal hinges on significant technological advances, including commercially viable low- or non-carbon energy sources. It also depends on supportive policies, successful carbon capture and storage negotiations, and the availability of cost-effective carbon credits.

2028 targets to lower the carbon intensity of operations

71 g CO₂e/MJ portfolio carbon intensity (Scope 1, 2, and 3)
24 kg CO₂e/boe (Barrel of Oil Equivalent) oil carbon intensity (Scope 1 and 2)
24 kg CO₂e/boe gas carbon intensity (Scope 1 and 2)
36 kg CO₂e/boe refining carbon intensity (Scope 1 and 2)

With this plan, the oil giant envisions to top the list of carbon intensity mitigators in oil, products, and natural gas.

GHG Emission Management

Chevron actively reduces carbon intensity by refining its portfolio, enhancing operations, and using its Marginal Abatement Cost Curve (MACC) process. It focuses on optimizing carbon reduction opportunities and integrating GHG mitigation technologies throughout its operations. The MACC process has identified over 150 GHG abatement projects.

This year Chevron plans to invest more than $600 million to advance these projects. From 2021 to 2028, Chevron expects to invest approximately $2 billion in these initiatives, aiming for around 4 mts of annual emissions reductions when completed.

The company targets key areas such as energy management, methane management (including venting, fugitive emissions, and flaring), CCUS, and offsets. Supportive policies like carbon pricing and effective carbon reporting are also a part of its GHG reduction protocol.

Chevron’s significant GHG mitigation projects include replacing diesel with alternative fuels in the Permian Basin and cutting 270,000 tons of CO2e since 2020. In France, the Oronite plant’s agreement with BioSynergy will meet 40% of its steam needs with biomass and solid recovered fuel, reducing CO2 emissions by 25,000 tonnes annually.

Combating Methane Emissions

Chevron has set a methane emissions performance goal of 2.0 kg CO₂e/boe upstream methane intensity by 2028. Since 2022, the company has designed new upstream facilities to avoid routine methane emissions. Notably, it has tested 14 advanced detection technologies since 2016, including aircraft-based gas mapping and satellite imaging.

Last year, Chevron contracted GHG Sat to monitor 18 onshore assets globally. Despite progress, accurate methane quantification remains challenging. To overcome these challenges, it has collaborated with third parties to enhance methane detection and measurement. Key partnerships are with Veritas and the Oil and Gas Methane Partnership.

Chevron’s Global Presence in Renewables 

By 2030, Chevron targets 100 mbd of renewable fuels, 25 mmtpa in offsets and CCUS, and 150 mtpa in hydrogen production capacity.

Renewable Fuels and Natural Gas

Chevron is advancing its renewable fuels to cut the carbon intensity of transportation. By 2030, Chevron aims for a production capacity of 100 mbd, including renewable diesel and sustainable aviation fuel. It is expanding its renewable diesel capacity with a new project in Louisiana and investing in feedstock development in Argentina.

The company’s renewable natural gas (RNG) projects mainly involve capturing dairy methane and turning it into useful fuel. It has partnered with Brightmark LLC to fund and operate biomethane projects and recently acquired Beyond6, LLC to expand its CNG stations.

A significant achievement in this space is its growing lower-carbon hydrogen and ammonia business. The company is working on the Advanced Clean Energy Storage Project (ACES I) in Utah and developing hydrogen infrastructure in the Gulf Coast region.

CCUS and Emerging Technologies

Chevron’s CCUS profile is quite impressive. Prime projects include Bayou Bend in Texas and the Gorgon project in Australia, one of the largest integrated CCS projects globally. Chevron is also investing in soil carbon projects with Carbon Sync to boost carbon sequestration.

READ MORE: Chevron Allots $26M to Carbon Capture and Storage in Australia

In Nevada, it is investing in geothermal projects with Baseload Capital, marking its entry into low- and medium-temperature geothermal energy. This marks a 100% commitment to reducing carbon emissions across major industries and hard-to-abate sectors,

Overall, the investment plan to achieve its net zero goals looks promising and we hope Chevron’s next quarter will bloom bright!

The post Chevron Reports Lower Q2 Earnings! What About Its Emissions? appeared first on Carbon Credits.

The rise of Direct Lithium Extraction (DLE) technology promises to open up new sources of lithium supply this decade, potentially helping to avert a forecasted shortfall. According to a new Benchmark special report, DLE represents a group of technologies that selectively extract lithium from brines. This novel technology offers a significant shift in the lithium supply landscape.

What is Direct Lithium Extraction?

DLE is a well-established technology with operational projects in China and South America. The process begins with extracting brine from aquifers, which is then transported to a processing unit. Here, lithium is selectively extracted using a resin or adsorption material, while the spent brine is reinjected into the aquifer, ensuring no depletion or environmental damage. 

Image from Cleantech Lithium website.

The resin captures or adsorbs lithium chloride (LiCl) from the brine. Then the captured lithium is stripped with water, creating a lithium eluate. This eluate undergoes further concentration through reverse osmosis and mechanical evaporation before being processed into battery-grade lithium using industry methods.

One of the key advantages of DLE is its ability to reduce the environmental impact compared to traditional extraction methods. Conventional techniques often lead to soil degradation, water pollution, and destruction of habitats and biodiversity. In contrast, DLE minimizes these issues by avoiding extensive evaporation ponds and using selective extraction methods.

Moreover, DLE technologies help lower the carbon footprint of lithium extraction by reducing energy consumption and greenhouse gas emissions. By employing more efficient and targeted extraction methods, DLE significantly cuts the energy required compared to traditional techniques.

This efficiency contributes to the decarbonization of the energy sector, making DLE a crucial technology for reducing the overall environmental impact of lithium production.

COMPANY SPOTLIGHT: The Fastest Growing North American Lithium Junior 

Current and Future DLE Production

Currently, there are 13 operational DLE projects projected to produce about 124,000 tonnes of lithium chemicals in 2024. By 2035, DLE is expected to contribute 14% of the total lithium supply, amounting to around 470,000 tonnes of lithium carbonate equivalent (LCE), as per Benchmark’s Lithium Forecast. 

While most of this supply will come from continental brines, geothermal and oil fields could contribute 9% and 14% respectively.

CHECK OUT live lithium prices here.

The Role of DLE in New Brine Projects

Almost 75% of new brine projects are expected to use some form of DLE. This highlights the growing importance of unconventional lithium sources and the expanding ecosystem of new players in the lithium value chain, especially oil companies that bring substantial capital and expertise.

Despite its potential, DLE’s path to commercialization faces several challenges, including:

issues with scalability, 
inflationary pressures, and 
delays at new brine projects. 

Technical risks also pose hurdles for new investors. Benchmark’s DLE special report outlines various DLE technologies, including adsorption, ion exchange, solvent extraction, and membranes, with adsorption being the most widely adopted and best-established, particularly in China.

Each brine source is unique in terms of impurity levels and lithium concentration, meaning there is no ‘one-size-fits-all solution’. Consequently, each DLE solution must be tailored to the specific environmental and economic conditions of the project.

Unlocking New Sources: Oil-field Brines

DLE technology has the potential to unlock previously undeveloped sources of lithium, such as petro brines and geothermal deposits, by achieving recovery rates of 80-90% compared to the current evaporation yields of 20-50%. This is particularly significant for “unconventional” brine resources in western jurisdictions, aligning with the political priorities in the US and European Union to build localized and diversified streams of critical minerals.

DLE’s potential is attracting significant interest from major players, including oil and gas companies. For example, Standard Lithium’s Stage 1A project in Arkansas could be the first petro brine project to come online in 2026. It has an initial production of 5,000 tonnes per year. 

Additionally, Exxon Mobil has signed a non-binding memorandum of understanding (MOU) with battery producer SK On for the supply of up to 100,000 tonnes from its DLE lithium project in Arkansas.

Despite the enthusiasm, DLE projects face significant capital and operating cost challenges. These projects have seen substantial cost increases as they advance and feasibility studies are updated.

Rising global inflation rates, along with higher equipment, utility, and labor costs, have driven these increases. For example, early-stage DLE projects have an average capital intensity of $37 per kilogram of lithium carbonate equivalent (LCE), while advanced projects average $60 per kilogram of LCE.

Given these challenges, Direct Lithium Extraction is unlikely to be a short-term solution for the lithium industry. Benchmark does not believe that DLE technology alone can bridge the structural deficits in the lithium market. However, it remains a promising avenue for expanding lithium supply in the long run.

READ MORE: Lithium Markets in Limbo: Next Leg Up or Down?

The post Is Direct Lithium Extraction the Key to Solving the Lithium Shortage Crisis? appeared first on Carbon Credits.

Meta’s Earnings Surge Amid Strong Q2 Results

Meta’s shares surged about 5% in after-hours trading on Wednesday following a robust earnings report that exceeded analysts’ expectations for the second quarter. The company, which owns Facebook, Instagram, and WhatsApp, reported $39.07 billion in revenue and $5.16 earnings per share. Both surpassed market predictions of $38 billion in revenue and $4.7 earnings per share. 

CEO Mark Zuckerberg highlighted the success of Meta AI and the company’s growth across its apps, including advancements in AI technology and Ray-Ban Meta AI glasses. The tech giant indicated that AI investments will be a significant driver of capital expenditure growth in 2025.

Meanwhile, other major tech companies have struggled recently, as their earnings reports didn’t show sufficient returns on their multibillion-dollar AI investments. This led to a decline in shares of Alphabet, Tesla, and Microsoft. But same with its peers, Meta is also faced with the biggest environmental challenge of tackling its growing carbon footprint, mainly due to AI. 

How Does Meta Deal With Its Ambitious Net Zero Goal?

Meta, the world’s fifth-largest tech company, is tackling the challenge of sustainability with ambitious targets and bold actions. Having achieved net zero emissions in global operations by 2020, the company now aims to achieve net zero value chain emissions by 2030. This is a significant challenge, as 99% of Meta’s carbon footprint in 2022 came from Scope 3 emissions, which continue to rise.

Rachel Peterson, Vice President of Data Centre Strategy at Meta, acknowledged the difficulty of this task in the company’s 2023 Sustainability Report. She noted that Meta’s Scope 3 emissions are increasing as the company supports the global demand for its services.

Meta is addressing this challenge by focusing on efficiency, circularity, and low-carbon technology. Through its supplier engagement program, the company aims to decarbonize its supply chain and enable at least two-thirds of its suppliers to set Science Based Targets initiative (SBTi)-aligned reduction targets by 2026.

To reach its sustainability goals, Meta reduced operational emissions by 94% from a 2017 baseline, primarily by powering its data centers and offices with 100% renewable energy. These renewable energy commitments have resulted in a reduction of over 12.3 million metric tons of carbon dioxide equivalent (CO2e) since 2018.

Reducing Emissions

Reducing greenhouse gas (GHG) emissions across Meta’s global operations and value chain is a top priority and a critical strategy for reaching net zero. Meta recognizes that failing to reduce emissions today will result in a high-carbon intensity business model in the future.

Meta’s approach to emissions reduction is guided by several core principles:

Choosing Better: Incorporating principles of circularity into the supply chain, construction, and purchases.
Designing with Less: Reducing the volume of materials in construction and hardware, extending the life of hardware components, and minimizing waste.
Embracing Low-Carbon Technology: Finding alternatives such as low-carbon fuels and innovative new materials.

Enabling Renewable Energy

Supporting Meta’s operations with 100% renewable energy is a critical component of the company’s net zero strategy. This task becomes increasingly challenging as the business grows. 

Meta partners with many of the largest utilities in the U.S. to integrate renewable energy into their systems in ways that benefit both Meta and other customers. The tech giant’s portfolio of over 10,000 megawatts (MW) of contracted renewable energy projects positions it as one of the largest corporate buyers of renewable energy worldwide. 

In the U.S., Meta boasts the largest operating portfolio, with more than 5,500 MW of renewable energy capacity currently online. Meta’s renewable energy projects represent an estimated $14.2 billion in capital investment for new infrastructure. 

Data Center Emissions

Facebook parent’s company focuses on circularity by designing hardware for efficiency and repairability. Its Design for Circularity guide integrates dematerialization, circular materials, reuse, and end-of-life principles. Key strategies include extending hardware lifespans, reusing components, and recycling end-of-life materials.

Meta partners with downstream firms to responsibly manage and repurpose residual materials, advancing its circular supply chain goals. Still, some emissions from hard-to-abate sectors will be difficult to reduce by the end of the decade. To address these, Meta has turned to carbon removal projects, a key component of its emissions reduction strategy.

Carbon Removal Credits: A Key to Slash Scope 3 Emissions

Meta’s diverse approach to carbon removal includes both nature-based and technological solutions. This strategy involves purchasing carbon credits from projects that align with Meta’s principles, ranging from reforestation to direct air capture technology.

Since 2021, Meta has supported numerous nature-based carbon removal projects worldwide. These include increasing forest carbon stock in community ejido forests in Oaxaca and protecting forests that provide habitat for salmon in California. 

Demonstrating its commitment to nature-based solutions, Meta recently signed a major carbon credits deal for 6.75 million carbon credits with Aspiration, a leading provider of sustainable financial services. These credits come from various ecosystem restoration and natural carbon removal approaches, including reforestation, agroforestry, and sustainable agricultural practices.

Meta’s role in the voluntary carbon market extends beyond purchasing credits. The company also supports new project development through financing and encourages the evolution of standards to bring more certainty to the market. 

Additionally, Meta collaborates with the World Resources Institute to develop methods for mapping forest canopy height using Meta AI training models. This initiative aims to provide publicly available data on forest canopy in areas like California and São Paulo, Brazil.

In 2022, Meta joined forces with other major tech companies to accelerate the development of carbon removal technologies by guaranteeing future demand. This effort, known as Frontier, is a $925 million joint commitment between Meta, Stripe, Shopify, McKinsey Sustainability, and Alphabet. 

READ MORE: Google, Meta, Microsoft, and Salesforce Launch “Symbiosis”

Meta’s strong financial performance and ambitious net zero goals underscore its commitment to innovation and environmental responsibility. As it continues to invest in AI and renewable energy and carbon removals, Meta is balancing its financial growth and environmental impact.

The post Meta’s Q2 Triumph: Earnings Soar And Carbon Removal Deals Multiply appeared first on Carbon Credits.

In an exciting development in the renewable energy space, Shell is set to install a 100MW renewable hydrogen electrolyzer at its Energy and Chemicals Park Rheinland in Germany. This electrolyzer will generate up to 44,000 kilograms of green hydrogen daily using renewable energy. The project, designed to help reduce the site’s carbon footprint, is expected to start operations in 2027.

Unlocking Shell’s Massive Green Hydrogen Project: The REFHYNE II

The REFHYNE II project is the outcome of the successful execution of the original REFHYNE initiative. The new phase, funded by the European Climate, Infrastructure, and Environment Executive Agency (CINEA), aims to scale up Europe’s largest Proton-Exchange Membrane electrolyzer from 10 megawatts to a massive 100 megawatts. Notably, it aims to produce ~ 15,000 tons of green hydrogen annually.

As mentioned before, it will be installed at Shell’s Rheinland Energy and Chemicals Plant in Germany. The electrolyzer will produce green hydrogen and oxygen from a renewable energy source. This green hydrogen will then be integrated into the existing refinery systems to help reduce emissions from refinery operations.

source: REFHYNE

REFHYNE II: A Strategic Investment in Green Hydrogen

REFHYNE II benefits from supportive policies, such as the EU’s binding renewable hydrogen targets and Germany’s regulatory framework. Additionally, the project has received backing from the EU’s Horizon 2020 research and innovation program. This investment aligns with Shell’s goal to transform its Energy and Chemicals Parks into lower-carbon product sources.

Shell’s Downstream, Renewables and Energy Solutions Director Huibert Vigeveno noted,

“Today’s announcement marks an important milestone in delivering our strategy of more value with less emissions. Investing in REFHYNE II is a visible demonstration of our commitment to the hydrogen economy, which will play an important role in helping to decarbonise Shell’s operations and customer products.”

Noted in Shell’s press release, the company’s key partners in REFHYNE II include ITM Power (Trading) Ltd, ITM Power Germany GmbH, Linde GmbH, TECNALIA, ETM, SINTEF AS, and CONCAWE. Shell anticipates that the hydrogen produced will meet the EU’s renewable fuels of non-biological origin (RFNBO) standards. It has further elaborated that the REFHYNE II project will fit within Shell’s cash capital expenditure plans and surpass the internal rate of return (IRR) targets for its Renewables & Energy Solutions division. This was highlighted during last year’s Capital Markets Day organized by Shell.

Shell’s Bold Investments in Green Hydrogen

Greg Joiner, Executive Vice President of Shell Energy said,

“Shell’s commitment to renewable generation projects creates a path toward a sustainable future, where innovation and clean energy come together to power a brighter world. Across Europe through these renewable developments and further third-party offtake agreements, Shell Energy is supporting businesses to progress the energy transition by providing expertise and a range of renewable power solutions and bespoke offers.”

Shell Nederland and Shell Overseas Investments, subsidiaries of Shell plc, have decided to build Europe’s largest renewable hydrogen plant, Holland Hydrogen I. It will begin operations next year at the Rotterdam port. The 200 MW electrolyzer will produce up to 60,000 kilograms of renewable hydrogen daily. Additionally, the plant will use power from the offshore wind farm Hollandse Kust which is partially owned by Shell. The green hydrogen will decarbonize the Shell Energy and Chemicals Park Rotterdam, the key manufacturing hubs for petrol, diesel, and jet fuel.

Notably, Shell has always been a trendsetter in the green hydrogen space. In 2022, Shell and Kansai Electric Power collaborated on liquid hydrogen (LH2) supply chains to decarbonize their businesses Their partnership involved producing decarbonized hydrogen, deploying Shell’s liquefaction and storage technology, and using the hydrogen at Kansai, Japan’s thermal power plants.

Manufacturing green hydrogen is playing a pivotal role in Shell’s energy transition strategy supporting it to reach net-zero emissions by 2050. No wonder, this has marked a significant step toward a sustainable future.

RECENT: Shell’s Polaris Project Fuels Canada’s Carbon Capture Revolution

Will the EU Meet its 2030 Hydrogen Goals?

In 2022 green hydrogen got a whole new perspective with a wide range of uses. It was being used in steel production, mobility, natural gas blending, e-fuels, and heating.  Thus, 41% of Europe’s clean hydrogen demand, amounting to 8.09 kt, came from these new hydrogen uses.

With Europe witnessing a rise in green hydrogen applications, the demand for it also grew. For instance, the Netherlands, the UK, and Austria rely on these applications for 100%, 90%, and 86% of their hydrogen consumption, respectively. In Estonia, it’s 100%, while in Switzerland, it’s 51%. Moreover, specific industries lead the demand in various countries. Germany’s refining sector accounts for 23%, Spain’s ammonia production makes up 80%, Iceland’s methanol production is at 90%, and Austria’s steel industry dominates at 83%. Check out the detailed report here: The EU hydrogen market landscape

source: EU

Furthermore, the European Roundtable on Climate Change and Sustainable Transition aka ERCST’s latest hydrogen report revealed that Europe has etched a significant mark in the low-carbon hydrogen market. It is fueled by ambitious targets and government incentives.

The EU adopted a hydrogen strategy in 2020, aiming to install 6GW of electrolyzers by 2024 and 40GW by 2030.

The REPowerEU plan, introduced in 2022 to reduce reliance on Russian natural gas, set even higher goals. It targets 20 MTs of renewable hydrogen use by 2030, with 50% from domestic production. BloombergNEF estimates that meeting this domestic target requires 125GW of electrolyzer capacity, which is 3x of its 2030 target.

EU Member States have also set their electrolyzer targets separately. It totals to 54.3GW by 2030. These national goals align with the EU’s hydrogen strategy but fall short of the REPowerEU target. However, BloombergNEF forecasts that EU countries will deploy a maximum of 23GW by 2030, based on the ongoing projects and policies. On the downside, this study indicates that most countries may not meet their national electrolyzer goals.

Overall, with a solid investment backup, the REFHYNE 2 project will push innovation to its peak. Consequently, Shell’s experienced team will manage the major scale-up with precision, thereby advancing green hydrogen significantly to achieve the EU’s target.

READ MORE: 2024 is The Golden Era For Europe’s Renewable Energy: Here’s Why

The post Shell Powers Europe With A Mega 100MW Green Hydrogen Electrolyzer appeared first on Carbon Credits.