By Joe Hill, Senior Director of North American Energy Transition and New Business Development
Companies across North America are in the process of shifting to a greater portion of renewables in their energy mix. Vallourec is committed to helping them make the transition as quickly and smoothly as possible. By taking an 'all-in' approach, the Group's Energy Transition initiative is building our profile among North American customers. We are helping them reap the benefit of our expertise and experience.
Traditionally, Europe has led the way in the energy transition, and its nations are further along their green journey than the US. While Europeans have invested in renewables directly, US companies are more inclined to invest in adjacent businesses. This is due to a variety of reasons - partly consumer sentiment, partly government regulations. The US is taking a different path toward a more sustainable energy mix, so the market here is also very different.
However, North America is now accelerating its move toward renewables, partly due to initiatives like 45Q tax credits for companies that sequester carbon. As carbon taxing is also brought into the equation, the two mechanisms will work together to drive the industry toward reducing its use of fossil fuels.
All the major oil and gas companies are getting on board now. Equinor and BP are looking into wind, Chevron is exploring carbon capture and hydrogen while others are working on geothermal energy sources. ExxonMobil just joined an 11-company consortium investing $100 billion of private and government money in carbon capture. It has also launched ExxonMobil Low-Carbon Services and is creating dedicated departments within the firm. In addition, BP, Equinor and Shell have all made commitments to achieving net zero by 2050.
The path less traveled reveals potential
By blazing its own trail and exploring other opportunities, North America can benefit from the lessons learned from Europe. For example, Europe has invested heavily in wind and solar energies, which we are also beginning to embrace, but these two sources can be intermittent. With possible challenges in mind, and as major US players get involved, solar, wind and other renewable technologies can evolve even further.
Vallourec is looking to help with all the major opportunities available to American firms, such as carbon capture, storage and utilization (CCUS), hydrogen, electrolysis, and geothermal energy. By leveraging industry leading know-how in material science and selection, as well as mechanical and welded connections, Vallourec is well positioned to deliver to the entire energy transition market. And we won't stop there: Vallourec is using its physical and digital experience in services to bring even more value to customers in North America and all over the world.
Collaborating with Calpine: spotlight on geothermal
The US is the world's biggest producer of geothermal energy, as the Pacific Ring of Fire holds more than 40% of the planet's geothermal energy resources. In California, Vallourec is perfectly positioned to support the exploitation of this valuable resource.
Right now, Vallourec is participating in a pilot project in Northern California, supplying casing, accessories, services for Calpine Energy, a prominent energy player in America. Via California's BRIDGE Grant opportunity, Vallourec is collaborating with the California Energy Commission, Calpine Energy, and GreenFire Energy to execute the project. Its purpose is to find ways to take lower performing wells and drastically improve their output while keeping levelized cost of energy low.
Vallourec is supplying THERMOCASE®VIT to Calpine, as well as to other clients. This solution is perfect for closed-loop geothermal applications as well as hydrogen and supercritical CO2 projects. In addition, Vallourec is currently following TWCCEP protocol to certify VAM® connections in this temperature range of up to 350°C. Since the biggest obstacle to overcome with geothermal is the high cost of entry, our work is focusing on lowering these costs.
Holding ourselves to higher standards
Our ultimate aim across all energy transition markets is to demonstrate that we can produce the high-quality solutions that clients need. We will achieve this by engaging early with technology providers, end users, and engineering firms to accelerate this market segment. This partnership could lead to large supply agreements in the US, as well as Canada and Mexico.
Vallourec is working hard to make the most of every opportunity possible. We have taken an 'all-in' approach. It's vital that we raise Vallourec's profile, using everything from increased social media activity to running booths at industry events such as the Geothermal Rising Conference. We are leaving no stone unturned!
Advancing these new applications impacts not only our business but also our own environmental footprint. The Group is proactively working towards reducing our industrial carbon output via abatement as well as capture and utilization. We are using our clear leadership position in material science, connections, welding, and services to advance CCUS for everyone.
Using this and other technology, we aim to reduce our greenhouse gas (GHG) emissions by 25% by 2025. This ambition is in line with Paris Agreement and validated by the Science-Based Targets initiative (SBTi).
Vallourec maintains an Environmental, Social and Governance (ESG) focus, Group-wide. Our strategy is producing results and we have recently been honored with Hart's "ESG Top Performer Award".
Building a network based on know-how and trust
As always, Vallourec's goal is to be known as an industry leader with specific expertise. Leveraging our know-how, expert teams, and years of experience in connections, we are now working on making a different kind of connection. We're forging contacts and building our reputation in this area by demonstrating that we have the information and solutions the industry needs. As our network grows stronger, so will our opportunity and activity.
About the author
Joe Hill first joined Vallourec in 1998 and subsequently joined the Energy Transition team in 2021, where he is responsible for North American activity in all five clusters. During his more than 23 years at Vallourec, he has had various positions in sales, operations, supply chain, and services. He holds a Master of Business from Tulane University in Louisiana.