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JSW Steel Italy announced the signing of an agreement with Creon Capital with the aim of developing the renewable energy, LNG, logistics and related industrial activities in the area of Piombino port. On September 15th, JSW Steel presented the Piombino 2030 Industrial Plan.

The new industrial plan for JSW Steel Group’s Italian companies, known as Piombino 2030, was presented on September, 15th at the JSW Steel Italy headquarters in Piombino. JSW Steel Italy’s Vice-President, Marco Carrai, the Undersecretary for Economic Development, Alessia Morani, the President of the Tuscany Region, Enrico Rossi, and the Mayor of Piombino, Francesco Ferrari, were present at the event.

Other participants were the Social Partners, representatives of the Province, of the Ministry of the Environment, of the Ministry of Labour, Invitalia, the Upper Tyrrhenian Sea Port System Authorities and the State Property Office. The meeting was also attended by all the financial partners involved in the industrial plan.

The industrial plan, which envisages an initial investment of 84 million euro thanks also to the participation of Invitalia, as announced in the same office by the Undersecretary for Economic Development Alessia Morani, is divided into two phases: the first, in the short term, aims to make the rolling plants more efficient, complete the product range and bring the company to satisfactory profitability. The second phase, in the medium term, targets over the next five years the return to steel production through the use of the electric furnace and the construction of a multicentric industrial complex that also includes logistics, manufacturing and environment activities to be carried out with selected partners in the individual sectors and financials.

“We are proud to present the business plan today, even in a difficult economic situation. I would like to thank all those present here for making this relaunch a reality” – said Marco Carrai, Executive Vice President JSW Steel Italy – “Invitalia, as announced today by the Undersecretary for Economic Development Alessia Morani, will support this first phase, aiming to relaunch the company and make it productive again. We hope that Piombino will once again become a key industrial place, starting from our core business, steel, and safeguarding all jobs”.

“We had made a commitment and respected it. For some months now I have been following the dispute with Minister Patuanelli. The first commitment we had made was the possibility for the State to enter the capital of JSW Piombino and this will be achieved in the coming weeks through Invitalia, which will enter with 30 million euros” – said the Undersecretary for Economic Development Alessia Morani – “The second commitment was on a regulatory level and took shape last week, with the approval of the simplification decree, regarding the rail orders for the Piombino factory, thanks to which we created the ideal conditions ensuring a continuity that guarantees economic peace of mind for the company and, of course, for the workers. I believe that the policy must be done in the following way: for commitments and concrete results. On the 24th there will be a meeting at Mise to update the addendum that necessarily follows the approval of the industrial plan. With Jindal, all the institutional partners and with the help of the trade union, we hope to guarantee a future for this factory, which is the heart of the city, as soon as possible”.

In recent weeks, JSW Steel Italy announced the signing of an agreement with Creon Capital with the aim of developing the renewable energy, LNG, logistics and related industrial activities in the area of Piombino port and the start of a dialogue with the ship builder Fincantieri to assess the possibility of allocating some areas within the Piombino industrial site to shipbuilding activities and large reinforced concrete cellular modules for maritime infrastructure.

DOWNLOAD the Press-release in English, Russian or Italian language

JSW Steel Italy Piombino S.p.a., Piombino Logistics S.p.a. e G.S.I. Lucchini S.p.a. are part of the diversified JSW Group in India, which has a leading presence in sectors such as steel, energy, infrastructure, cement, sports, among others. Today, JSW Steel Ltd. is one of the leading integrated steel companies in India with an installed capacity of 18 MTPA.



Piombino (Italy), 1st September 2020 – Creon Capital has signed a Memorandum of Understanding (MoU) with JSW Steel Italy Piombino S.p.a., Piombino Logistics S.p.a. and G.S.I. Lucchini S.p.a. aiming for the development of a sustainable energy industry in Italy.

Together with local partners, the fund management proposed to start working on an investment plan that should upscale the Tuscan region of Piombino into a cluster for hydrogen, renewable energy, LNG, and logistics. Accordingly, the MoU has been signed by Dr. Fares Kilzie as Chairman of the Board of Directors (Creon Capital) and Marco Carrai, Executive Vice President of JSW Steel Italy Piombino S.p.a., Piombino Logistics S.p.a. and G.S.I. Lucchini S.p.a.

Subject of the development plan will be the area in the municipality of Piombino, located on Tuscan Coast, 90 kilometers south of Livorno. JSW Steel Italy Piombino s.p.a., Piombino Logistics S.p.a. and G.S.I. Lucchini S.p.a. are companies belonging to the JSW Group, are the concessioner of a part of the area and have an option on another part of it, which is undergoing an industrial conversion.

Creon Capital team will be in charge for ESG integration, fundraising, and strategic development. As the Luxembourg-regulated Creon Energy Fund follows a distinctive sustainable investment approach, the management will evaluate initial quality, ongoing integration, and overall performance of environment, social and governance (ESG) factors in all related projects.

Dr. Fares Kilzie, Chairman of Creon Capital Board of Directors, underlines: “Due to its geographical location and excellent infrastructure, we estimate great potential for the industrial zone Piombino to become an innovative cluster for contemporary energy projects in Italy. Thanks to our strong footprint in the global energy sector, we are capable to attract investors as well as technology partners into the establishment of an energy cluster, that might consist of hydrogen, renewable energy, LNG storage and regasification projects.”

Marco Carrai, Executive Vice President of JSW Steel Italy Piombino S.P.A., Piombino Logistics S.p.a. and G.S.I. Lucchini S.p.a. underlined: “Our long relationship with Creon capital gives me the full confidence in conducting all our plans for Piombino in the midterm and long-term future.”

The Presidency of Tuscany Region, underlines: “cost of energy is a key issue for a full restart of a new steel plant in Piombino. We welcome this MOU as it demonstrates that public efforts put in the area made it attractive for new potential investments on top to the engagements from JSW Steel Group.”

Additional information

JSW Steel Italy Piombino S.p.a., Piombino Logistics S.p.a. and G.S.I. Lucchini S.p.a. are part of the diversified US$ 12 billion JSW Group in India, which has a leading presence in sectors such as steel, energy, infrastructure, cement, sports among others. Today, JSW Steel Ltd. is one of the leading integrated steel companies in India with an installed capacity of 18 MTPA.

See detailed information on the JSW Steel website.

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The coronavirus pandemic has dramatically changed the global economy. And investors are “risk on” again. In addition to the pandemic currently sweeping the world the climate crisis remains in the background and investors are increasingly worried about environmental risks. Russian companies, in particular, are worried about being penalised for environment related issues and will have follow the Green Economy trend that is being demanded by retail investors, first and foremost.

The coronavirus pandemic has distracted from the furore created by Swedish climate crisis campaigner Greta Thunberg and her “Friday’s for the Future” youth movement. Nobody seems to care anymore about climate change since the globalization has stalled. People fear losing their jobs more than what the future holds — even on Fridays.

But appearances are deceptive. While governments around the world are busy curbing the pandemic and managing economic loses, a sophisticated green financing infrastructure is being built in the background. Companies, especially in Europe, which has embraced Thunberg’s call to action, taking their ESG (Environment – Social – Governance) responsibilities seriously and including it in their long-term strategies. This trend will not stop, and can be expected to grow in importance.

The pandemic has sharpened the senses to risks among companies’ decision-makers. Coronavirus has clearly demonstrated the fatal consequences of underestimating the risks for supply chains and the disruptive power Mother Nature still commands.

Banks, investors, and regulators re-evaluate risks that go beyond the pandemic. A World Economic Forum (WEF) report on global risks has linked nine out of ten risks directly to ESG factors, the most important of which are the protection of the climate and the environment. Financial players have started to closely monitor companies’ ESG policies.

While the world is fighting the coronavirus, Europe continues its efforts to build up a large-scale financial infrastructure for ESG investors. In 2016, the Luxembourg Exchange launched the Green Stock Exchange (LGX) – a trading platform for securities and Eurobonds of projects that meet 17 UN sustainable development goals (SDGs). Today it is the global leader in the “green bond” market, whose volume doubled to €216bn in 2019. Today less than one per cent of all traded bonds are green, but this market has enormous growth potential.

Investments revaluation

Large investors have already given an impulse to “greenify” the market, and the rest of the investing community is expected to follow. Last summer, the world’s largest investment company Blackrock banned all investments into the traditional energy sector. In October, the Norwegian pension fund Global sold its stake in Russia’s metallurgical titan Norilsk Nickel for environmental reasons: according to the Norwegian Ministry of Finance, the environment is suffering because of the company’s activities, and this violates the fund’s code of ethics (although Global itself made €900bn  from oil sales the same year). And Brussels has already banned the European Investment Bank (EIB) and the European Investment Fund (EIF) from investing in oil, gas, and coal industries.

A this trend progresses more and more investors are expected to redistribute funds from fossil fuel producers to green-tech companies. Raising capital in equity markets for green and eco-friendly companies will become easier. Financial institutions will monitor ESG-compliance and make access to credit lines and bank accounts easier. In the case of non-compliance with these standards, credit and capital will become hard to get.

Classical energy companies will be subjected to the neoclassical risks. Why invest in bonds, even a super-profitable oil company, if it is exposed to non-ESG compliance risks or public scandal that could ruin an investment overnight? Neither investors, nor banks, nor regulators are willing to bear responsibility for serious environmental consequences.

Russia has no choice but to follow the trend

“The trend if your friend,” runs the old market adage, but in this case it is a trend with a twist. Falling oil prices have already created problems for the low-liquid waste market, which is still at very early stage of development.

The upshot of the low prices is petroleum raw materials to make plastics is now cheaper than recycled plastic waste. But the large petrochemical producers such as Russia’s Sibur and Nizhnekamskneftekhim remain committed to using recycled plastic in production, thanks to pressure from their strategic partners, customers, investors, and banks as well as their own ESG-compliance rules.

Many Russian companies are actively introducing ESG compliance strategies and officers. For an example, Russia’s major privately owned Lukoil oil producer covers 6% of its electricity needed using renewable sources – primarily solar energy. Shell plans to spend €2bn a year on development of alternative energy sources, and the Norwegian oil major Equinor will invest one fifth of its investment budget in renewables.

Russian petroleum companies are still far from these numbers, though they are already active in environmental protection initiatives. Environmental performance of oil and gas companies is monitored by Transparency Rating of Environmental Responsibility, which has been jointly conducted by Creon Group and WWF Russia (World Wild Fund for Nature Conservation) for seven years already.

The time for large investments into the green economy has come. Now is the time to develop clean renewable energy, reduce burning of associated gas to zero, and increase the share of recycling in the polymer industry. In the new economic order only businesses with a consistent strategy for sustainable development in the social and environmental arena can be profitable. This need has already recognized by many, not just Greta Thunberg.

 


Florian Willershausen, director of Creon Capital, managing Luxembourg-based fund’s company Creon Energy Fund, which invests in projects of green technologies, renewable energy and logistics projects. The fund is the core part of Creon Group, a strategic consultant in the transition to sustainable development and integration of ESG factors.


 

This text has been published on Intellinews:

https://www.intellinews.com/opinion-why-the-russian-economy-will-inevitably-become-green-after-the-covid-19-epidemic-is-over-183464/?source=russia

A Russian version is available on the leading Russian online portal RBC:

https://trends.rbc.ru/trends/green/5ea82ca89a79472db412c14a?from=center



The investment Greon Group in partnership with World Wildlife Fund (WWF) Russia extended the participants’ geography of its environmental transparency rating with oil companies from Azerbaijan. For the first time analytics compared them to ones from Russia and Kazakhstan. The rating allows to assess investment attractiveness of oil companies, which becomes very important for industry’s post-corona crisis recovery.

Two corporations from Azerbaijan have been joined this year to the annual transparency rating of oil and gas companies run by Creon Group and WWF: State Oil Company of Azerbaijan Republic (SOCAR) and Azerbaijan International Operating Company (AIOC).

“The situation with coronavirus is alarming but should be temporary: oil and gas markets slump caused by global economic slowdown worsened by the coronavirus pandemic. However, I am sure the industry will overcome today’s challenges”, said Fares Kilzie, chairman of the board of Creon Group. “The rating importance will be even higher after the crisis as it defines transparency and ecological responsibility of oil companies. Here are key indicators for any investors in today’s business reality”, emphasized Kilzie.

Along with newcomers, two Azerbaijan oil companies, the Eurasian rating represents 20 major Russian oil and gas companies with production of crude oil and gas concentrate exceeding 1.5 mln ton per year and 14 Kazakhstani companies with production exceeding 0.5 mln ton per year.

Head of Environmental Policy Program at WWF Russia Alexey Knizhnikov added, “geographical expansion of rating has not only extends the number of participants from new countries, but more importantly, allows us to explore and analyze the level of impact on environment in line with industry average indicators for region. It is the first time when we got a chance to compare oil companies of Russia, Kazakhstan and Azerbaijan by multiple ecological criteria”.

The new criteria have been used to compare greenhouse gas emissions per unit of energy for three countries. Russian and Kazakhstani companies’ emission rate is 73.29 and 76.12 kg per unit of energy respectively, whereas emissions data of Azerbaijani companies is higher. As commented Mr Knizhnikov, “We are certain that the data of greenhouse gas emissions will decline gradually as it decreased in other companies of our rating list”.

According to Mr Kilzie, ESG (Environment-Social-Governance) responsibility factors are becoming key criteria for investment decisions in energy sector. “We see it clearly in western markets as oil companies have to conduct internal audit for board of directors, banks and shareholders, and forced to being transparent and responsible to the broader society. In order to pass double exam and to achieve sustainable development, businesses need to be ranked in a credible ecological rating and keep moving toward transparency”, suggested Mr Kilzie.

 

DOWNLOAD the Rating brochure here (EN/RU)

 

Reference

An annual independent Rating of Environmental Responsibility of oil and gas companies have been facilitated in the frame of “Rational Approach” for Russia since 2014, Kazakhstan joined in 2017 and republic of Azerbaijan beginning in 2020. The rating helps to evaluate the ecological responsibility of oil companies with production exceeding 1.5mln ton per year. Joint project of Creon Group and WWF has been found in order to accomplish two goals: to reduce environment impact and encourage oil companies operating in Russia and CIS countries to integrate ESG (Environmental, Social, Governance) related factors, and moving forward sustainable development goals.  

 

Contacts

 

Alexey Knelz
Head of Corporate Communications CREON Group
alexey.knelz@creon-group.com
+7 (985) 773-31-93

Polina Shkividorova
Press secretary WWF Russia
+7 495 727 09 39
PShkividorova@wwf.ru



Since 2008, the UAE-based renewable energy company Masdar hosts the Abu-Dhabi Sustainability Week (ADSW) to promote green technologies and renewable energy as cornerstones for a cleaner global energy sector. This year, CREON Group is committed as a sponsor of the World Future Energy Forum. A large delegation of specialists participates in the exhibition and forum discussion. More than 5.000 visitors visited the several sectoral summit and the exhibitions.

It is common knowledge that Arab countries such as the United Arab Emirates have achieved economic prosperity thanks to traditional energy sources. But some might still underestimate, that especially the UAE accelerated to the world leaders in terms of investments in new energy sectors. Their state policy in the field of renewable energy is based on the principles of sustainable development formulated by the UN and regionally ensured by active government support of investments in the new energy sector such as renewable energy and green technologies. During the Abu-Dhabi Energy Week, the Minister of Energy of Saudi Arabia, Prince Abdulaziz Ibn Salman Al Saud, predicted that the share of gas and renewable sources in the energy balance of the kingdom will increased significantly. Among renewable energy sources – not only solar and wind, but also hydroelectric power plants.

Sultan Ahmed Al-Jaber, UAE Minister of State and Chairman of Masdar, announced the goals of sustainable development of the emirates for the next 30 years: “At the national level in the UAE, we have increased our portfolio of renewable energy sources by more than 400% in the last 10 years, and we are on the path to doubling it again over the next 10 years. ” By 2030, the country plans to reduce greenhouse gas emissions by 25% and reduce the share of water use from natural sources to 0.5%. The Masdar Chairman stated that «the UAE not only talks the talk but walks the walk towards renewable energy. Because it is right and makes perfect economic sense».

It is no coincidence that the headquarters of the International Renewable Energy Agency (IRENA) is located in the UAE capital. The eco-city of the future Masdar City was built here, and since 2006 the company of the same name Masdar has been operating, through which the Abu Dhabi sovereign fund invests in green projects in 25 countries of the world. Khaldun Khalifa Al Mubarak, CEO of Mubadala Development Company, considers his main task “to act now, given the climate changes that threaten not only future generations, but the very existence of our planet.”

Green technologies and environmentally friendly energy solutions are in line with the investment objectives of the fund managed by Creon Capital, which is regionally oriented towards the emerging markets of Eurasia. The fund is constantly looking for new opportunities for clean energy. Fares Kilzie, Chairman of the Board of Directors of Creon Capital, explains why such solutions for the energy sector will be most in demand: “In parallel to traditional types of energy, Russia and the CIS countries are beginning to show interest in renewable energy and environmental solutions. The result is green projects worth trillions of dollars. As the country diversifies toward clean energy, it will also continue to invest in the responsible production of traditional forms of energy. We urge the majors of the Russian oil and gas sector, who have extensive capabilities and all the necessary infrastructure, to engage more actively in the implementation of green technologies and renewable energy sources. ”

Pictures:

Creon and Masdar executives meeting in Abu-Dhabi (from the left): Mohamed Jameel Al Ramahi (CEO of Masdar),Yousif Al Ali ( Acting Executive Officer of Masdar Clean Energy), Dr. Fares Kilzie (Chairman Creon Capital), Vladimir Nekhvyadovich (1st Deputy CEO ISS Global Solutions).
Masdar Chairman Dr. Sultan Ahmed Ad Jaber opend the Abu-Dhabi Sustainability Week (ADSW)

 

 

 

 

 

 

Creon Capital is represented in the exhibition zone with a stand, as well as portfolio companies such as ISS Global Solutions.

 

 

 

 



As in the previous year, Sakhalin Energy ranked first in the Environmental Transparency Rating of Russian Oil and Gas Companies. The international producer of liquefied natural gas (LNG), owned by Gazprom, Shell, Mitsubishi and Mitsui outperformed in terms of openness on environmental topics, a clear strategy on environmental responsibility and with concrete measures to decrease the production’s impact on the environment. On the second and third ranks followed Zarubezhneft and Exxon Neftegas Ltd., which also confirmed their leading positions of the previous year.

The rating was conducted for the sixth time already. From the very beginning, CREON Group supported the project as a strategic partner, whereas WWF (Russia) takes responsibility for the methodology and the National Rating Agency carries out the calculation based on publicly available sources. In 2019, the project was part of the EU funded People for Nature project. The government of the Russian Federation supported the event as well: The presentation took place in the government’s Analytical Center in Moscow. This time, 20 oil and gas companies were subject of the rating.

In addition, five companies received diplomas in additional categories: Lukoil was granted for its top performance in terms of environmental transparency, Rosneft was honored for encouraging the most constructive dialogue regarding accidents and controversial situations. For its leadership in mitigating environmental impacts Surgutneftegaz received a diploma, whereas Gazprom Neft was granted for its most dynamic growth of oil recovery. Tatneft has shown the most rapid advancement in the rating, which led to a diploma as well.

CREON Group chairman Dr. Fares Kilzie reminded: “We launched this project in 2013, which turned out to be revolutionary for the industry. The concept we are promoting is a forerunner not only in Russia, but globally. It is hard to acknowledge, but the results of our activity will not be visible today or tomorrow. At present, we are witnessing the changes in the Russian oil & gas business, and the massive efforts of the government and the companies are evident now, alongside a significant and inevitable transformation towards sustainable development. And we as a Group are proud of being part of the process.”

Aleksey Knizhnikov of WWF Russia confirms a significant increase of the companies transparency: “The modern economy is rapidly transforming and today investors and consumers value both the economic component of transactions and the social and environmental responsibility of businesses, which is important for gaining a competitive edge,” points out the WWF Russia Head of the Program for the Business Environmental Responsibility. “For the sixth year in a row, we have seen increasing progress in the companies’ disclosure of environmental performance. According to our estimates, public nonfinancial reporting of oil and gas companies has showed the fastest development in Russia over the last  years and is becoming the basis for dialog with stakeholders on reducing environmental impacts,” he says.

The robustness of the method and the accuracy of calculations were confirmed by the FBK Grant Thornton audit and consulting group. The company performed selective tests of the criteria and analyzed the accuracy of the scores (levels) against the method, returning a favorable opinion. Vladimir Skobarev, Partner and Head of Corporate Governance and Sustainability at FBK Grant Thornton underlined: “The role of sustainability ratings as important tools for external assessment of corporate social responsibility is increasing every year, while the practice of independent confirmation of the ratings themselves, in turn, is a tool to increase trust in them.”

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About:

The Rating of Environmental Responsibility in the Russian Energy Sector has been launched in 2014 as an initiative of the CREON Group and WWF Russia. The project’s objectives were to conduct tangible and comparable information on environmental activities of oil and gas companies. Thanks to the publicity effect of the rating, some influence could be exerted on the companies in Russia, which partly increased transparency, decreased pollutions or developed an environmental risk-management-system. In 2017, the rating was first presented in Europe, also a separate rating of the Kazakh oil and gas companies was conducted.

The World Wide Fund for Nature (WWF) Russia works with state institutions, companies, experts and local communities to change people’s attitude to nature. The priorities of WWF’s various activities in Russia include the protection and preservation of biodiversity, sustainable forestry and fisheries, the «green economy», environmental governance, climate and energy.

CREON Capital is a fund management company based in Luxembourg. It manages the CREON Energy Fund, which actively invests in energy projects. Green technologies, renewable energy and logistics are among the focus areas of investments. The private equity fund also invests in the processing of gas and the construction of a liquefied natural gas infrastructure.

 

You may DOWNLOAD the rating brochure HERE:

 

For further information please contact:

Maria Dymenko, md@communicationz.ru, +7-985-135-1009

 

Pictures:

Creon Group chairman Fares Kilzie congratulated representatives of Russian oil and gas companies with outstanding results in terms of environmental protection and transparency.

 

Sakhalin Energy ranked first in the rating. The company’s director for environmental protection Andrey Samatov (right) received the diploma from Creon Group chairman Fares Kilzie.

 

The rating on “Environmental Transparency of Russian Oil and Gas Companies” has been conducted for the sixth time in joint cooperation between Creon Capital partner Creon Group and WWF Russia. It aims to push the energy companies forward in order to increase measures on environmental protection, which is increasingly happening.


The Eurasian Economic Forum in Verona is one of the leading networking platforms for businesses and politics linking Europe and Eurasia. On October 24-25, the event was held by the Italian “Cognoscere Eurasia” initiative for the 12th time, as usual gathering more than 400 leaders from all over Eurasia in the city’s beautiful old town. Creon Capital chairman Dr. Fares Kilzie attended a panel discussion on the role of natural gas in helping Europe’s energy security and climate change goals, alongside with Gazprom Deputy Chairman Elena Burmistrova and Leonid Mikhelson, Chairman of the Management Board of Novatek.

Prior to the debate, Igor Sechin, President and CEO of Russia’s leading oil producer Rosneft, had set the tonality for the day. He turned out to be very confident that oil and gas will remain key sources for energy production throughout the upcoming decades, hydrocarbons will still account for more than 50 percent of the energy mix in 2030 despite the growth of renewables. For this time period, he forecasts a 20 percent growth of oil demand due to the increasing consumption in Asia, first and foremost in India. But Sechin underlined: “We at Rosneft show that oil production is possible in a socially and environmentally responsible way.”

The Creon Energy Fund is committed to gas-related projects, which are a cleaner alternative to Diesel and gasoline. However, improving the entire energy sector’s ecological responsibility maintains an objective for the fund managers of Creon Capital, as chairman Dr. Fares Kilzie stated. “We consider investments in green technologies as being commercially viable and reasonable. Therefore, we aim at co-investing with companies of the energy-sector in projects to slow down climate change.” As one example he named the Fund’s attempts to develop a market for small-scale LNG and CNG, which ensures that vessels and trucks can be fueled with cleaner gas instead of Diesel and heavy oil.

This seems to be in line with the “bullish” expectations of Novatek’s Leonid Mikhelson. Russia’s leading exporter of liquefied natural gas recently corrected its capacity plans for 2030 upwards: Instead of 57 million tons, the company now plans to produce and export 70 million tons annually, up from 19 million tons this year. Similarly, also Gazprom’s leader Elena Burmistrova presented the audience ambitious plans to improve the gas giant’s position on the LNG market, including small-scale infrastructure projects on the domestic hydrogen market.

Both Mikhelson and Burmistrova made clear that natural gas will play inevitably a major role in reducing the climate impact of the energy sector. Creon chairman Fares Kilzie, however, put more emphasis on renewable energy, which is deployed increasingly even in hydrocarbon-based countries such as Kazakhstan and Russia. The Fund joint-venture ISS Global Solutions these days completes one of the largest transportation projects for windmills going from China and Germany to Kazakhstan.

Kilzie finally pointed out that even hydrocarbon producers have to think day-by-day how to become “greener”: “As we are running a private equity fund in Luxembourg, we know perfectly how banks and regulators increasingly pay attention to environmental and social responsibility of companies and their projects. We recognize rapidly growing demand for ‘green bonds’, but emitters have to fulfill strict preconditions in terms of environmental responsibility”. For the Eurasian energy companies this would means, that they must become “best-in-class” in terms of environmental protection.

Pictures:

Fund chairman Dr. Fares Kilzie (center) with Gazprom 1st Deputy Chairman Elena Burmistrova (right) and Novatek chairman Leonid Mikhelson on a panel discussion about energy security and climate change.
Fares Kilzie concentrated his speech on the need to invest more in green technologies as even gas suppliers are forced by banks and customers to meet ambitious ESG objectives.

 

Novatek Leonid Mikhelson explained his plans to quadruple his LNG production volume to 70 million tons p/a until 2030.

 



Like it or not, coal will remain an important resource for generating energy and heat over the coming decades. Countries such as China, Russia, Kazakhstan and even the EU member state Poland are increasing their coal production. It is therefore even more important to minimize environmental and health risks associated with coal. This is the mission of CoalTech Limited.

Clean Invest Africa Plc (NEX:CIA) and fund management company Creon Capital are pleased to announce the launch of CoalTech S.a.r.l. The joint company aims to expand towards Russia and CIS markets with innovation by CoalTech Limited. Recently acquired by the clean technology and renewable energy investment company CIA, CoalTech has developed an innovative agglomeration solution that converts coal fines waste deposits into combustible coal pellets via a proprietary technology.

CoalTech innovative solutions are required in Russia and CIS countries, which account for roughly two thirds of the coal production in Eurasia, excluding China. Creon Capital invests in the joint project with its clean-tech focused Creon Energy Fund (Sicav-SIF), aiming to develop multiple projects and scale up production in these markets. The Fund’s initiator Creon Energy (Moscow) will be responsible for the project implementation regionally, while adding value through its vast network in the region’s energy sector.

The technology used for upcoming projects is unique: With the help of patented binders, coal fine waste is being dried and processed into pellets, which show the same calorific values, composition and other characteristics as the coal of the respective mine itself.

CoalTech CEO Filippo Fantechi explains: “Our technology produces a valuable product made out of polluting and toxic waste. Tested successfully initially in South Africa, we are now ready to upscale globally. Russia and the CIS countries are attractive markets from an environmental and health perspective, as well as having an enormous industrial legacy. People in the region suffer from poor water and air quality, as residues of coal production and processing are often released into the environment. Drinking water is often contaminated by coal fine leaching. In winter times, carbon particles from coal fines in the air sometimes create what is known as ‘black snow’. These coal fines could relatively easily be cleaned-up and processed into combustible pellets with CoalTech’s green technology. We look forward to working with Creon to maximize this commercial clean–up opportunity”.

Dr. Fares Kilzie, Chairman and CEO of the Fund managing company Creon Capital, is confident that the new technology will be demanded in the region: “People in Russia and other former soviet countries care increasingly about how companies treat the environment, especially when phenomena such as ‘black snow’ highlight the problem of pollution. Companies have to take this into account, the industry and government authorities are seeking solutions, and the CoalTech green technology provides a commercially attractive solution whilst enabling the industry to effectively improve its environmental and social impacts.”

Creon Capital chairman Dr. Fares Kilzie and Shaikh Mohamed Abdulla Al Khalifa, main shareholder of Clean Invest Africa, signed the shareholder agreement in Forte dei Marmi (Italy). CoalTech S.a.r.l. has been established in Luxembourg, further updates shall be provided as the Russia and CIS opportunities develop.

UPDATE: CoalTech S.à.r.l. has been incorporated on October 4th, 2019.

 

You can DOWNLOAD the press-release here (EN/RU).

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ABOUT US

Creon Capital S.a.r.l. manages the Luxembourg-based Creon Energy Fund (S.C.A. Sicav-SIF). The regulated Alternative Investment Fund (AIF) concentrates investments up to 100 Mio. Euro (targeted) on green technologies, logistics projects, value-adding midstream and downstream energy projects. The unlimited opportunity fund cooperates with partners such as the Investment Corporation of Dubai (ICD) and is focused on emerging markets and uprising new business segments in Eurasia and the Middle East. The Fund’s initiator and general partner is the Moscow-based independent consulting and management company Creon Energy, which brings add value on projects in Russia and CIS countries by using its vast network and market expertise in the region.

CoalTech Limited is registered in the UK and its parent company, Clean Invest Africa Plc is listed in London NEX Exchange (NEX:CIA). CoalTech has developed a revolutionary and innovative agglomeration solution that converts coal waste into combustible coal pellets via a proprietary technology using a specially formulated organic binder and a customized production process. CoalTech has developed its proprietary technology over almost a decade, has an operational producing and testing plant in Witbank, Province of Mpumalanga, South Africa. This plant started commercial operations in November 2018. The plant is expected to operate at full capacity soon, generating revenues on target margins based on a net monthly volume of 5,000 tons.

Creon Capital chairman Dr. Fares Kilzie (on the left) and Shaikh Mohamed Abdulla Al Khalifa, main shareholder of Clean Invest Afrika Plc. signed the shareholder agreement, based on which the Luxembourg-based Joint Venture CoalTech S.a.r.l. will be established.

 

 

 

 

 

 

 

 

 

 

 

 

 

The team of CoalTech Ltd, Creon Capital and Creon Energy after the signing ceremony (from the left): Yuri Ratnikov and Vladimir Voloshin (Creon Energy), Abdulla M. A. Al Khalifa (CoalTech Ltd.), Dr. Fares Kilzie (Creon Capital), Shaikh Mohamed Abdulla Al Khalifa (Clean Invest Africa), Sandjar Turgunov (Creon Group), Florian Willershausen (Creon Capital).

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Press Contact:

Maria Dymenko,
Creon Group
Head of Corporate Communications
E-Mail: md@creon-group.com
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Relations between Moscow and the EU have hit their lowest level in decades. But feedstock industry expert Fares Kilzie says the bloc’s current energy diversification attempts will not leave Russian firms stranded.

There’s hardly anyone who knows more about the German petrochemical industry’s enormous need for resources than Russian entrepreneur Fares Kilzie. In the early 1990s, he was based in Germany helping companies such as Bayer and Süd-Chemie secure petrochemicals from Russia.

After 2001, Kilzie went back to Russia and eventually founded the Creon consultancy helping European companies understand the Russian energy market. 2016 saw the establishment of the Creon Energy Fund in Luxembourg, which provides guidance for investing safely in Russia.

DW met up with Fares Kilzie in Berlin to talk about the future of Russian energy supplies to Germany and the European Union as a whole.

DW: Talking about EU-Russian business relations these days, also in the energy and feedstocks sectors, is a bit like walking through a minefield, following Russia’s falling out of grace with the West over its perceived role in the Ukraine conflict, would you agree?

Fares Kilzie: In my business life, relations between Russia and the EU have never been worse than they are today. But I have to add that we experience this bad state of relations mainly in Brussels, and we don’t see it in Berlin. Russia and Germany are still having a very constructive dialogue even while relations between Russia and the EU in general are in a bad state. Dialogue between Moscow and Berlin is strong, despite heated arguments being exchanged sometimes.

Russia has been a very reliable supplier of hydrocarbons for Germany all along, concerning both natural gas and oil. As for oil, Rosneft has been one of the major oil suppliers in Germany, and Gazprom the main provider of gas — maybe Novatek will become a third important player with LNG [liquefied natural gas].

I gather from your answer that you don’t believe the good times for Russian oil and gas suppliers to the EU are coming to an end. But don’t increased attempts in Berlin and Brussels to diversify supplies and thus reduce dependence on Russian sources tell a different tale, especially when it comes to natural gas deliveries?

When it comes to debates about reducing the amount of pipeline gas coming to Germany from Russia, I was one of those who expected that to happen even before the crisis in relations with the West started. I was in contact with German feedstock buyers, and they were telling me as early as the 1990s that they would have to diversify their supplies. So I know this approach very well. I believe it’s a good one, because risks have to be spread when it comes to feedstocks.

Many analysts insist Germany — and other recipients in the EU — could have easily done without the controversial Nord Stream 2 gas pipeline. What’s your take on this?

Touching on the current Nord Stream 2 controversy, Russia in this project is only assuming the role of a technical partner, meaning it lays the 1,200 kilometers of the pipeline to Germany and supplies the gas, but any decisions beyond that have to come from Germany. In my eyes, the project is very important for the chemical industry in Germany. Parts of the industry are already migrating from Germany as there are at times not enough feedstocks for the industry. In order to create new products and jobs, you also need large amounts of gas at a reliable price — and you need it now, not in five or 10 years. Russia is offering this opportunity of getting more by 2020.

But isn’t it rather risky for public joint stock company Gazprom to keep focusing almost exclusively on its pipeline business?

In Russia, I’ve been know as a critic of Gazprom for exactly that. Many see Gazprom as the holy cow of Russia, generating a big share of the country’s income, so that seems to make it untouchable. There have been a lot of changes in Gazprom’s management structure over the past two months and there’s more to come. We’ve always said in the Russian media that Gazprom is inefficient, not using the latest technology and moving very slowly toward the gas refining business.

I never shy away from the fact that this sort of miscalculation could lead to trouble in the future. Only time will show how it will fare by focusing only on its pipeline business and not expanding its activities to LNG. But we’ll only have an answer to this in five or six years from now. My personal opinion is that they made the wrong decision also by trying to convince the Russian president that the shale gas story in the US would be ending soon — it’s not ending. On the contrary, it’s taking geopolitics to another level.

In the second quarter we expect to have equilibrium between the price for pipeline gas and that for liquefied natural gas, which is very good for the market.

According to the European Commission, the EU’s gas demand is around 480 billion cubic meters and is projected to remain stable in the coming few years before going down as a result of the bloc’s climate protection policies and the increased use of renewables. So, aren’t today’s investments in gas deliveries shortsighted anyway?

Let’s face it, gas is one of the most environmentally friendly products that we have at the moment, with relatively low CO2 emissions. It’s very easy to handle. We’ll see a lot more electrical cars in the future; we’ll see more wind farms and solar energy facilities. Right now, though, the German feedstock problem is that neither wind nor solar can replace the physical hydrocarbon to produce ethylene for example.

As soon as there are reliable pipeline supplies, the chemical industry will start investing. BASF (Wintershall/DEA) and others are trying to secure the feedstocks as soon as possible so as not to lose out in the competition with Asian or even US producers. Several million jobs are affected, directly or indirectly, as we’re talking about construction chemicals, paint chemicals, chemicals for the auto industry and so on. Half of any ordinary car is made of petrochemical components (polycarbonate, polyethylene etc.), so you have a wide range of products that are needed here.

Private Russian energy company Novatek is looking to establish a foothold in Europe including Germany where it aims to open a regasification facility in Rostock by 2022 – and this against the background of the German government having promised the US administration it would build two LNG terminals of its own to also receive American gas …

Novatek is also looking at the Spanish market, the Italian and Moroccan markets, and it’s looking to build regasification facilities in order to supply gas to customers, who have no access to pipeline gas. Rostock, with its long-term trade ties with St. Petersburg, can play a major role for the German economy. It’s a gateway to Germany. To have a regasification facility there, coupled with reliable gas supplies from Novatek to serve the German market is a nonpolitical thing. It’s only a small-scale regasification unit.

The Novatek activities in Germany can’t really be seen as a threat to any other LNG supplier because of the low volumes to be involved.

For 25 years, Fares Kilzie has been helping European companies doing or wanting to do business in Russia. He’s the founder of Creon Group, an independent investment and management association focusing on the energy and chemical industries in Russia and the Commonwealth of Independent States (CIS). The Creon Energy Fund invests in Russia together with European technology partners.

The interview was conducted by Hardy Graupner.

Link: https://www.dw.com/en/expert-russia-to-remain-crucial-feedstock-supplier-despite-spat-with-brussels/a-48213356



Dubai’s fast-growing logistics provider Integrated Service Solutions is striding forward its global expansion in seven-league boots. Just today as the new headquarter was inaugurated in the Airport Free Zone, also the formation of a joint venture with Creon is completed, the structuring via the Creon Energy Fund is in process. “ISS Global Solutions” is based in Luxembourg, from where most projects in Europe and Eurasia will be directed. Roberto Bizzarri, the group’s specialist for oil and gas projects, will act as the company’s CEO.

The order books of ISS Global Solutions are already being filled: On behalf of General Electric, the company will carry out the transport of wind turbine generators from Europe and China to Kazakhstan. Operationally the teams of ISS GS and of the Hamburg-based Chandler GmbH will be in charge, the latter is being integrated in the structures of Integrated Service Solutions and will adopt the ISS branding soon. Over the past twenty years, an experienced team of logistics professionals has gained reputation of being able to implement even complex industrial logistics projects such as forwarding equipment to Novatek LNG plants on the Yamal Peninsula.

In this sense, the team will quickly become part of the family of Integrated Service Solutions, believes Group CEO Enver Moretti: “It is part of the self-definition of ISS, that we do not hesitate to accept even most complex assignments. We are not only moving parcels from A to B, but we ship large industrial plants – across Africa’s deserts and to the cold spines of Siberia, if required. “With the century-long cumulative experience of the ISS team and the slim structure, these shipments are both profitable for us and cost-effective for the client.

Russia and CIS countries will be a focus region for ISS Global Solutions. Creon Group, which structures the 50/50 joint venture through the Creon Energy Fund in Luxembourg, has been working in the region as a leading advisory and management company for twenty years. Chairman Dr. Fares Kilzie explains why professional logistics solutions are needed: “Instead of exporting oil and gas, countries such as Russia, Kazakhstan and Uzbekistan now focus on processing and refining of raw materials. This results in large projects in the energy, chemical, and mining industries, worth of several hundred billion dollars over the next decade. “The JV provides simple logistics solutions to complex projects.” For Creon the investment in ISS Global Solutions is merely one of many investment projects.

 

Emirates boss Sheikh Ahmed Bin Saeed al Maktoum cuts the ribbon to the new group headquarters in Dubai. Integrated Service Solutions Group CEO Enver Moretti (2nd from the right) and ICD Executive Director Sheikh Mohammed Ibrahim al Shaibani (r.) welcomed more than 100 partners to the official inauguration ceremony, which coincides with the launch of the JV with Creon