Net Zero Is Being Redefined as Global Failures Mount

We are witnessing a total fiscal collapse and deindustrialization in the UK, the EU, and Canada, primarily due to the implementation of Net Zero policies. This and other stories confirm today the path for the countries following Net Zero. In the story TotalEnergies Wins Legal Battle to Shut Down North Sea Oil Fields. we see a total failure of the UK government shutting in oil and gas that they need and will only increase prices to consumers. This will only accelerate the financial collapse they are facing.

We are also tracking different sources for the meetings in Alaska with President Trump and President Putin. If they talk business, and plan other things like joint drilling in the Arctic without the EU or the UK, this will be a great thing, and help end the war. And ultimately end the need for sanctions on India. I would rather do business with Putin and have no war as Russia is critical to the new trading blocs that look to be forming.  For those who claim they don’t want to do business with Russia, consider China. We do a lot of business with China, and they have over 50K military-aged men and equipment in the United States and own a huge chunk of farmland near our bases.

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The Global Struggle to Meet Renewable Energy Goals – is this a shift back to oil and gas?

How will this impact Net Zero? Stu Turley

Stuart Turley: [00:00:13] The global struggle to meet renewable energy goals? Is this a shift back to oil and gas, Michael? This is also, how will this impact net zero? This story I had fun writing on the Energy Newsbeat substack, it is about 3 main points, the total failure of wind and solar and hydrogen to be sustainable, and what I mean by that is by the simple fact that they need subsidies to survive. Number two, the lack of funding going into oil and gas exploration has now changed and after reviewing big oil companies and forward statements, after reviewing their Q2 earnings, we are seeing a change in the second half of 2025. Also in the third part of this article, economies based on net zero energy policies are failing at a dramatically steep incline. First part of this story, Michael, was Orsted’s financial woes. Holy cow, Batman, they lost almost $8.7 billion what they need to shore up their finances and their stock absolutely went south for the winner. In the U.S. Delays and increased expenses like the sunrise wind led to a $1.7 billion impairment was one of their excuses. But yet here’s the biggest problem with Orsted. They have never designed their projects to be designed without subsidies. They’ve always relied on that. Now, on the day after that, that Orsted Michael TPI composites has voluntarily filed for chapter 11 bankruptcy in the US and they’re the number one blade manufacturer. Oops. Now let’s take a look at the counter side of this or where this argument is coming from. BP stood up their earnings call this past week represents a $5 billion cut in green energy budgets from BP, but they’re talking about the slastich planned investment into renewables between $1.5 billion and $2 billion down from previous forecasts. Then you take a look at next decade. Next decade got $1.8 billion injection for LNG project. Michael, this is huge because guess who’s investing in it? You’ve got Total Energy, ADNOC, and a few others investing into next decade. And I have reached out to next decade to interview their CEO. Now, here’s where I took this story. I took a comparison of oil and gas investment of their Q2 earnings versus Q2 earnings for renewables. And you take a look at how much money was given back to investors in oil and gas versus what was given back into the renewables and Michael, it was like nothing in renewables, so why would you want to invest in renewals? There is no money in renewibles. Here’s the bottom line. Net zero will be redefined in the next six months into the next money grab because it is no longer working and they’re recalibrating it right now. [00:03:32][198.8]

Michael Tanner: [00:03:32] I think it’s really fascinating that, you know, people always ask, well, where are all these companies going? What’s all, where’s it headed? It’s all in their earnings report. Now what they do is they just throw it on page 20 of a 25 page report. So it’s, really now only with like tools like AI, which can summarize things and pull things out that we’re actually able to dig in and find all this stuff. And I think, it’s really interesting. I mean, I find it hilarious that private equity is losing their shorts on all these renewable investments. Now, losing their shorts or are they in it for the tax deductions? Because again, there were great credits available for renewables and there still are if you get the project spudded. That’s an oil and gas term. If you get at stake, if you move a little bit of. [00:04:13][41.4]

Stuart Turley: [00:04:14] Dirt by what end of 2026 some by 2027. I have to go check the numbers, but it’s still bad because the profitability won’t be there for return. So why put any money into it? [00:04:25][11.5]

Michael Tanner: [00:04:25] I mean, we’ll talk a little bit about this in my segment, but the oil and gas had pretty robust Q2 earnings relative to what’s happening on the renewable side. So I don’t think it’s any shock that we’re seeing this. Oh no. [00:04:36][10.5]

Stuart Turley: [00:04:37] Let’s go to the next story here. Slower transition to clean energy sets the stage for a stronger demand for fossil fuel decade. This is from Doug Sheridan. Doug Sheriden over on LinkedIn has a fantastic point and he says, the Financial Times writes the world’s leading oil companies are stepping up their hunt for new oil and gas reserves. He must’ve read my article. As a slower than expected transition to clean energy set the stage for stronger fossil fuel demand. My chevron x on mobile shell and total energies all use recent earning call the highlight how they began refocusing on securing new energy reserves on years of prioritizing and renewals i think this is absolutely not only was this like all by the way i read this after i wrote the other story this was kinda cool that it doug shared and i have the same opinions on this. [00:05:30][53.2]

Michael Tanner: [00:05:30] No, it really is true. We love us some Doug Sheridan. And I think specifically his research into this is interesting. I do think. You know this, as he mentions, this geopolitical instability has led governments to really have to shift away from decarbonization back into energy security. I mean, we preach about energy security on the show all the time. And I mean talk about the investment that’s needed to maintain hydrocarb productions. That’s a big, big number. Seven trillion with a t-t-t t worth of additional capital need to be deployed. We need some, we need some more investors, I’ll tell you that much. [00:06:07][36.6]

Stuart Turley: [00:06:07] Oh, yeah. But you know what? You’ve heard me say this before, Michael. ESG actually did environmental, social and governance actually did a great thing. And that is the oil and gas CEOs heard that call loud and clear. And for years, they’ve been giving very good returns back to investors, both in the private sector and in the public sector. Hey, let’s go to the next story here, Michael. Trump’s tariff gambit puts India in an oil price bind. This is an outstanding story from Irina Slav over at oilprice.com. And I really, A, I respect her and she is just a cool cat. We highly recommend everybody go to her sub stack as well too. Trumps plan to impose a 25% tariff on Indian imports over its Russian crude purchases hurts India and that puts India in a dilemma between preserving an $87 billion in U.S. Exports or saving billions through discounting oil. Michael, which would you rather think is more important, saving billions in discounted oil or trying to placate to President Trump on the $87 billion in trade deficit? Guess what Modi is going to do. Modi does not like being pushed, and he is going to say to President up yours. And I think that this is a very bad move by President Trump to continue on this article. [00:07:38][90.9]

Michael Tanner: [00:07:38] Well, I think from the standpoint of doing what’s best for India, we’ve always praised Prime Minister Modi for that. He is truly India first, which in today’s world, that’s being crazy. Why look out for yourself? You got to look out for all these other stakeholders that don’t even really matter. So it’s very interesting. I do think I agree with you. I think these tariffs that he’s putting on Indian imports over Russia are going to be terrible. I think it’s going to strain our relationship with India as India is going to be along with China, the biggest importer of American goods and an ability for us. Us, we do not want to lock out India in terms of doing business with them. They’re one of the largest populations and growing. [00:08:18][40.0]

Stuart Turley: [00:08:19] Exactly. I see a, if everything happens by Friday, the way I’m hoping it’s going to come out two ways while we’re on the Russia issue. President Trump can walk into that room in Alaska and say, Hey, President Putin, two minutes. We’re going to know in two minutes whether or not this is done. So if he walks up and goes, hey, I’m here to make a deal. Boom, we’re off and running and you’re going to see new trading blocks happen. The United States, Russia, India, Saudi Arabia, and everybody’s going to come out of this a global group. Therapy hug in a new trading block. And I’d like to see India in on that. I really would like to see that. We’re doing business with China and they hate our guts. And as Ron White would say, they hate are good. This is absolutely nuts. Let’s go to the next story here, Michael. Next decade gets a $1.8 billion injection for an LNG project. We kind of talked a little bit about this, I wanted to go into this just a little bit deeper on this. The chairman, Matt Schatzman, chairman and CEO, I reached out to him this morning to try to get him on the podcast. And the reason this is important is because the other ones that are investing in this are total energies and GIP. This is very important as we try to build out our LNG export facility. This is actually pretty cool. The stock is surge fifty seven percent pushing the company’s market cap above the three billion that’s huge. [00:09:56][97.0]

Michael Tanner: [00:09:56] No, it is huge. I think LNG as we’ve talked again at Nausium on this show is going to become ever more important. Export facilities are even going to be even more important and players like Next Decade, Total, and all the other partners they have on this project are only going to better. I mean, this Rio Grande facility, like you said, located near Brownsville, Texas, it’s going to even just in phase one, one of the largest export terminals, which I think is absolutely insane. It’s approximately 5.4 MTPA of capacity. I mean, that’s a megaton, literally, and that total project costs somewhere between 6 and 6.2 billion. Total is going to toss in 300 million for a 10% equity stake. GIP will commit 1.5 billion for a 50% stake, which could theoretically decrease to a 30% stake if specific return on investment milestones are achieved. Next decade is going to go ahead and contribute 1.2 billion, securing a 40% interest that could rise up to 60% if certain KPIs are hit. So we also know that Abu Dhabi’s national oil company, ADNOC, is going to hold a 12% stake in the overall project and has signed a 20-year off-take agreement for LNG from that train 4, which really solidifies its commercial viability. So I mean, they’ve got everything lined up from a finance and structure standpoint. I would be very interested in it. And again, we’re going to be following this very closely. [00:11:19][83.2]

Stuart Turley: [00:11:20] Oh, you bet. Hey, let’s go to this last story, and it kind of tags along with our first story here as well. And you take a look at how net zero is going to change. This last story is soaring electric bills in New Jersey, policy failures, energy mix insights and national cost comparisons. The crisis unfolding in New jersey. Residents like Rebecca from Highland Park are emblematic of the problem. Her monthly bill jumped from an average of 300 to over $1,000, despite no changes in household usage. Quote, I don’t know how we’re expected to absorb these new bills. She lamented on social media. Michael natural gas is 49.6% of the New Jersey power. Nuclear is 45% solar is 2.9%. My head exploded. Why are their prices expanding? It’s the distribution costs that are going through the roof and the net zero fees. This is nuts. This is absolute net zero bull hockey at its finest. [00:12:31][70.8]

Michael Tanner: [00:12:31] Bills are up, Stu. I mean, it’s kind of crazy. I mean it is the problem with when you have super hot summers, electric bills do skyrocket. Now a lot of this has to do with their oil and gas and the mix of renewables. I mean you look at this. They’re saying from Highland Park, they’re saying that their bill jumped from an average of $300 to $1,000 a month despite no changes in household usage. That’s the key. As I mentioned, usually in summer you use more energy. I’m running my AC all the time. You know, of course, it’s going to cost me a little bit more, but there’s been no change in household uses. You know we know property taxes are up. We know all this stuff is up. I mean it’s unbelievable. It’s and this is interesting. So to give you guys an idea, most of the power that comes from New Jersey is actually natural gas and nuclear, which is really interesting from a baseload energy standpoint. Now remember, New Jersey aims for 50% renewable by 2030 and 100% carbon by 2050. They won’t hit that. But it does go to show you, you are vulnerable to price increases from natural gas if prices do go up. If you’re allowing that price to float, it is what it is. So when people say, oh, well, natural gas, all the grid, prices are going to be low, yeah, they’ll be low. But you are still giving yourself the ability to get hurt as prices for the end refined natural gas product rise. Now, speaking of that, prices for natural gas have absolutely tumbled in the last two months. So you might get to the point where those numbers come down. [00:13:58][86.4]

Stuart Turley: [00:13:58] Well, if the governor actually would allow pipelines and since they’re up in that area, it would actually go down. [00:14:05][7.4]

Michael Tanner: [00:14:06] Yep. And you bring up a great point. Some of it’s not just how much the energy mix, some is how is that energy getting imported? And if you’re having to do all of these crazy import methods like New Jersey, it doesn’t matter if you are totally reliant on natural gas and nuclear, if you can’t get any of it into your state, you’re going to be paying definitely higher bucks for it. [00:14:26][20.2]

Stuart Turley: [00:14:26] Right. Anything else? Nope. I’d say buckle up and get ready to watch for Friday. Yeah. [00:14:31][5.2]

Michael Tanner: [00:14:32] Yeah, absolutely, guys. Well, let’s quickly jump over and talk oil and gas finance. But before we do that, let us quickly pay the bills. As always, thank you for checking us out here on the world’s greatest website, dot energy newsbeat dot com. Stu and the team do a tremendous job making sure that website stays up to speed. Everything you need to know to be at the tip of the spear when it comes to the energy and the oil and gas business, go ahead and hit the links in the description below. You can see all the timestamps links to all of the articles. And you can also find the link to our sub stack. Please, if you are a listener of this podcast, we really appreciate it. Subscribe to our Substack. It’s one of the best ways to support the show. You get a daily digest from straight out of Stu’s and Mai’s mind, which really takes each one of these stories and combines them into a daily theme. Really, really appreciate everybody who has subscribed there. It’s theenergynewsbeat.substack.com. We appreciate the subscription. We’d also like to shout out friends of the show, Reese Energy Consulting. Guys, we love Reese Energy consulting. If you are at all needing help in the midstream space, whether you’re an upstream company, you know, that has a midstream component that you need a little bit of help with with you’re dealing with your first purchaser or your natural gas off takes what you’re looking at tying into a pipeline, you need anything surrounding the midstream space guys, Reese Energy Consulting is your go to you can find them Reese energy consulting.com they have clients for anywhere from two people in a garage all the way up to the largest publicly traded company. So if you’re wondering, am I a good fit for them? The answer is yes Reese energy Consulting.com we love them. And finally, guys, sign up for our oil and gas portfolio survey at investin oil.energynewsbeat.com. We have a great little tax savings calculator so that you can understand and calculate your tax burden, but then also see how much investing in oil and gas can save you on taxes. Once you fill that out, we will reach out with a bunch of information so that we can help advise you on your investing journey. And if you qualify, point you in the right direction. Guys, again, that’s investinoil.energy newsbeat. It’s a great time to consider investing in Oil and Gas. We’re getting closer to the end the year’s end of the year, Stu. And taxes are going to become a thing. And this is a great portfolio diversification, investing as close to the wellhead as you can. Guys, invest in oil.energynewspeak.com. [00:16:36][123.7]

Michael Tanner: [00:16:38] I mean, pretty, pretty wild day, Stu. We’re recording this sort of early afternoon on the 12th. S&P 500 up a little bit over a percentage point. NASDAQ up 1.2 percentage point, two and 10-year yields. Two-year yield’s down point, basically down a percentage point. 10-Year yields actually up 3 tenths of a percentage. Dollar index down about a half a percentage point, a Bitcoin up to 119,000, up about 7 tenths a percentage points. Crude oil not having a great day down about a full percentage point or $0.70, 63.26. Brent Oil basically down the same amount, 66.29. Natural gas losing about 16 cents or about five, five and a half percentage points. $2.79. XOP, which is our E&P securities contracts, actually up 1.66 percentage points, which are oil field services actually up one point seven percentage points really fascinating. We’ve got, you know, markets and really what’s driving, I think the overall market was US China agreed to extend their tariff pause till November. So that’s really interesting. Trump and Putin, as you talked about earlier in the show, Stu, our meeting on Friday, which sort of is kind of putting a cloud over the oil markets. We did see the EIA crude oil inventory, and we did see a drop of about 2.8 million barrels in the strategic reserves. But again, what’s really driving oil prices right now is the fact that Trump and Putin are going to talk on Friday. And it seems like that sentiment that’s coming out, Stu. And I don’t know, I’d be interested in to kind of hear what you think is going to go on in the meeting. But I think Trump’s going to come and lay a little bit of a hammer on Putin. I don’t they’re too terribly pleased with each other. He mentioned it could be a five-minute meeting. It could be 10-hour meeting, depending on how things go. What’s your sense coming out of that meeting? You think we’re going to get any resolution, whether it’s to the Ukraine wars, and then specifically as it pertains to the energy markets, or what are your sources telling [00:18:18][100.4]

Stuart Turley: [00:18:19] my sources are actually kind of quiet for the first time in quite a while. And so I’m kind of at a loss as far as where I see it going, where I would like it to be seen. President Trump divvy up the land. And if the President Zelensky was installed by MI6 and the CIA, and quite honestly, if he does not want to play ball, then I think that they need to go ahead and let Russia just beat the snot out of them and we’re done. If the parliamentary steps up and they actually want to end the war in Ukraine and they want to go ahead and let the Russian speaking area of Ukraine go back to Russia, I’m all in. I think that that would be the best way and not have NATO expand. I think we’re going to see a very peaceful world. [00:19:06][47.3]

Michael Tanner: [00:19:07] Well, good. That’s always great to hear. On the oil and gas front, before we dive into kind of just some overall earnings thoughts, I think it’d be helpful to point out BKV who we love over there. And also like to give a quick shout out to a great friend of mine that works at BKB, Gabe. He’s a new father as of today. So shout out to Gabe. You’re going to make an awesome dad if you’re listening to this. But BKP went ahead and actually entered into an agreement to acquire a decent chunk of Bedrock Energy Partners, Barnett Shale Assets. That transaction was valued at $370 million coming with that was about 97,000 net acres, which is pretty contiguous to BKB’s existing acreage along with all of their midstream assets. And it ends up being about 108 million cubic, 108 million MCF of production, which has about 63% natural gas, the rest liquids, they get about 1100 locations, pretty low base decline rate, they get a pretty massive amount of about one TCF of P1 reserves, which about over 70% of that is actually PDP. You know, they get about 50 new drill locations, but really what I think is more interesting is the 80 low cost refrac locations. And you know, BKV has been one of the few companies that have sort of been really hammering these refracs hard. And if you do them right, I’m not a huge refrac guy, but I think done right, done smart, having a strategy built around them, specifically like what BKB does, That’s a great, great addition to their refrac program, continuing to migrate. It’s basically a combination of cash and stock. The stock’s valued at about $110 million. So there is about $260 million of cash changing hands. Basically, their net leverage now drops to that 1 to 1.5 range, which is actually great. So a really good acquisition by them. But I want to just quickly step back. We’ve seen kind of the bulk of the earnings happen. We talked a little bit about that, Stu, in your substack this morning about what we’re seeing, but lots of strength with the earnings. I mean, going back to what we saw with the XOP, which is our EMP kind of securities. I mean, specifically looking at that, that thing has been on a little bit of a, sort of a… I don’t want to say a tear, but it’s been outside of… Obviously when you take and factor in the price of oil, things have been a little volatile there, but earnings have been somewhat solid for oil and gas companies. You know, Q2 obviously saw some. Some higher accretive pricing, which led to, I think, of a decent amount of these good earnings. But I think overall earnings were really good for oil and gas companies. I think part of that is them prepping for what’s going to be a tough Q3 when it comes to pricing, when it comes to a bunch of different stuff. But overall, I was pretty happy with where earnings landed. And I think it’s going to be very interesting to see where all of these public companies go through and what happens next with mergers. We’re about ready to drop a substack here in the next couple days, Stu, that talks a little bit about what’s next for ExxonMobil. So I’m excited to get that one going. [00:21:57][170.0]

Stuart Turley: [00:21:57] Cool, that’ll be kind of fun. [00:21:58][0.8]

Michael Tanner: [00:21:58] It will be fun. Well, what did we miss, Stu? This is our, we got, you know, this will drop. Obviously you’ll be listening to this on Wednesday and Thursday. Thursday, you’re gonna see all of the clips from this show. Friday you’re going, what are we running Friday? [00:22:09][10.6]

Stuart Turley: [00:22:09] Let me check real quick. [00:22:10][1.0]

Michael Tanner: [00:22:11] Where we’ve got a bunch of different interviews in the can. We’ve got some good people lined up. You’ve got Michael Flynn coming on early next month. [00:22:18][7.2]

Stuart Turley: [00:22:19] Absolutely. And that’ll be kind of fun. And I will be in the Permian next week doing some interviews. And we have one with Adam Hirshfield SVP of work wise on the oil and oil and gas patch. [00:22:33][14.5]

Michael Tanner: [00:22:34] Nice. That’s awesome. That’ll be really good. I’m excited for that one. We love work right there. Doing some cool stuff with AI. Well, Stu, we’re going to let everybody get out of here. Finish up your Wednesday. Appreciate you guys checking us out here on the energy newsbeat stand up. Stu and I are just really excited to keep this coming to you. Hope you guys have a great end of the week and a great weekend. We’ll be back in the chair Saturday for our weekly recap. And then you will see us back in each chair on Monday, guys. Hey, have a good weekend. Till next time. [00:22:34][0.0][1334.0]