Voices of COP 21: Growing Skepticism as Climate Talks are (Again) Extended

Mr. Christophe Hecker, a shale gas investor in the United States, expresses his skepticism on the outcome of the COP212015 Paris Climate Conference, while promoting shale and natural gas as a transition fuel. 

Natural Gas Europe: We are getting closer to the end of the COP21 without a meaningful agreement in sight. French foreign minister Laurent Fabius, who is leading the conference said early Friday that a final document will not come before Saturday morning. What's your take on the current negotiations at the COP21? Is it just another conference? 

It reminds me of the last COP in Copenhagen in 2009. Much talk, but no action. This time, the awareness has grown, and a lot of things have happened in 6 years, but I do not think we will reach a binding agreement. It looks complicated. One-and-a-half billion people on this planet have no access to electricity yet and they will need fossil fuels to get it. There will be a lot of good political intention.

I am more confident in the ability of every world leader, or regional institutions to set up a new dynamic, but it won't be a direct consequence of the COP21. I hate the political exploitation behind the events and its over-coverage in the French media. 

How can we get an agreement with 195 countries at the negotiation table?

It seems just impossible. That's why I am stunned by the political exploitation. How can we find a common ground at a world level when we can't even agree on common energy policy within Europe?

You mentioned the lack of common policies in Europe. What do you think of the Energy Union project?

I am very skeptical. There is so much else we can do in Europe. I don't buy it. I am convinced that countries should implement appropriate mechanisms to promote renewables. We have developed too many subsidies in the past. We have to put the market first and apply its rules to other energies. Renewable energies have to adapt to prices (for instance, the nuclear market in France). New mechanisms will allow for the development of solar energy to connect to the grids aimed to sell electricity instead of granting subsidies.

In that regard, the setting of a carbon price is essential. How much should the carbon price be? (The latest draft document does not include a push for countries to set a carbon price because of the opposition of two countries, Saudi Arabia and Venezuela.)

It's important in Europe and beyond. The problem is that I did not heard anything about carbon prices before and during the COP21, although this a key element. I heard about EUR 100, EUR 400... 

If we could set a significant price, it would resolve many of our problems. It's a lack of a courage and leadership from politicians who are more interested in distracting the public with other concepts, but fixing a carbon price would be a strong decision that could change the world in terms of environment. Unfortunately, the conversation on this issue is deadlocked.

Is it possible to combine the development of natural gas without slowing the increase of renewables in the energy mix?
I strongly defend the idea that gas must be considered as the fossil fuel that can support clean energies' developments the most effective way by replacing coal. Coal still represents 40% of world electricity production. Meanwhile, the oil and gas industry has to realize that this transition mix will last 30 or 40 years. Then, a true energy transition will be required though I don't think we will get to 100% of renewables due to electricity storing issues. Gas companies can diversify their electricity supplies, like for example Engie (formerly  GDF Suez), which has made major investments in renewable energies and tackling the transition themselves. 

What's a shale gas investor in the United States doing at the COP21? 
Developing shale gas while tackling climate change is not conflicting. We often talk about shale gas in a negative light, but shale gas is still natural gas event if it's extracted in a different way. I see in the United States a transition from coal to natural gas. Coal was the first energy resource used to produce electricity in the mix until 2011-2012, when significant shale gas resources were discovered which had lowered market prices. Gas has become cheaper than coal allowing such a change in the energy mix. US gas became three times less expensive than gas in Europe. People do not mention the fact that the United States have reduced their carbon emissions because of this new energy reality. I am at the COP21 to repeat that natural gas, including shale gas, is the fossil fuel that would support the energy transition and the developing of renewable energies.

Should Europe import natural gas from the United States to diversify its supplies by reducing its Russian dependency?

It's actually already happening. Cheniere Energy, the main US exporter of the east coast, signed a contract with EDF and ENGIE starting in 2017 and 2018. It's very important for Europe to diversify its gas supplies for two reasons. Cheniere says that US gas could be cheaper than the Russian gas and I agree with that assertion. The second reason is that we also rely on countries which have an unclear relationship with terrorist organizations. Saudi Arabia and Qatar are alleged to fund terrorism for instance. We are wondering where the EUR 9 billion we give to Saudi Arabia for supplies go.

Meanwhile, supplies coming from Norway and Algeria tend to go down, right?
Algeria has a huge problem in terms of gas production. Gas reserves are declining rapidly. So Algeria will need shale gas. The decrease is even faster in Norway. We are also depending on the Netherlands but it does not have geopolitical consequences.

So France and Europe as a whole may become even more dependent on Russian gas in the future?
Yes if Russian gas can compete with US gas. Russia needs a barrel price of between $100-120 to be economically viable. The recession could reach 3.5% this year. Gazprom would have to change the way its sell gas. The state-owned company has already taken a new approach by signing spots contracts with spot pricing instead of practicing long term contracts. As a consequence, Russia may have less leverage on import countries. 

Do you agree with the assessment that, despite conflicting geopolitical circumstances, Europe may have to strengthen its economic ties with Russia?
it's essential. I don't think that the decision made by Vladimir Putin to join France in the fight against the Islamic state in Syria was a philanthropic act. It's a way to ease the tensions with some of Gazprom's clients which have enacted diplomatic sanctions against Putin's regime. It could help to resolve the crisis in Ukraine. We cannot dissociate the energy and geopolitical aspects.

So what does it mean for the pipelines projects in Europe, especially the Turkish Stream? 
It's a major setback for the Turkish stream. The pipeline project will likely be stopped because of a lack of trust between Russia and Turkey, which could revive the Nord Stream II in the Baltic Sea. The pipeline would bypass Ukraine raising economic fears in that country. It's no coincidence if Ukraine is pretty active in terms of shale gas developments. 

Interview by Kevin Bonnaud