The future of the global shipping industry – and its 3% share of global emissions – will be decided in three weeks of talks in the third quarter of this year, after a decision taken in London on Friday.

At the International Maritime Organisation (IMO) headquarters this week, governments largely failed to substantively negotiate a controversial set of measures to penalise polluting ships and reward vessels running on clean fuels known as the Net-Zero Framework. The green shipping plan has been aggressively opposed by fossil fuel-producing nations, in particular by the US and Saudi Arabia.

This week, countries delivered statements outlining their views on the measures in a session that ran from Wednesday into Thursday. Then, late on Friday afternoon, they discussed when to negotiate these measures and what proposals they should discuss.

After a lengthy debate, which the talks’ chair Harry Conway joked was confusing, governments agreed to hold a week of behind-closed-door talks from 1 September to 4 September and from 23 November to 27 November.

Following these meetings, which are intended to negotiate disagreements on the NZF and rival watered-down measures proposed by the US and its allies, there will be public talks from November 30 to December 4.

Last October, talks intended to adopt the NZF provisionally agreed in April 2025 were derailed by the US and Saudi Arabia, who successfully persuaded a majority of countries to vote to postpone the talks by a year.

Those talks, known as an extraordinary session, are now scheduled to resume on Friday December 4 unless governments decide otherwise in the preceding weeks. While this Friday session will be in the same building with the same participants as the rest of the week’s talks, calling it the extraordinary session is significant as it means the NZF can be voted on.

Em Fenton, senior director of climate diplomacy at Opportunity Green said that the NZF “has survived but survival is not a victory” and called for it to be adopted later this year “in a way that maintains urgency and ambition, and delivers justice and equity for countries on the frontlines of climate impacts”.

NZF’s supporters

The NZF would penalise the owners of particularly polluting ships and use the revenues to fund cleaner fuels, support affected workers and help developing countries manage the transition.

Many governments – particularly in Europe, the Pacific and some Latin American and African nations – spoke in favour of it this week.

South Africa said the fund it would create is “the key enabler of a just transition” and its removal would take away predictable revenues from African countries. Vanuatu said that “we are not here to sink the ship but to man it”.

Australia’s representative called it a “carefully balanced compromise”, as it was provisionally agreed by a large majority after years of negotiations, and warned that failing to adopt it would harm the shipping industry by failing to provide certainty.

Santa Marta summit kick-starts work on key steps for fossil fuel transition

Canada’s negotiator said that if it was weakened to appease its critics like the US and Saudi Arabia, this would disappoint those who think it is too weak already like the Pacific islands.

A large group of mainly big developing countries like Nigeria and Indonesia did not rule out supporting the framework but called for adjustments to help developing countries deal with the changes. Nigeria called for developing countries to be given more time to implement the measures, a minimum share of the fund’s revenues and discounts for ships bringing them food and energy.

According to analysis from the University of College London’s Energy Institute, the countries speaking in support of the NZF include five countries which voted with the US to postpone talks in October and a further ten countries which did not take a clear position at that time. Most governments support the NZF as the basis for further talks, the institute said.

Opposition remains

But a small group of mainly oil-producing nations said they are opposed to any financial penalties for particularly polluting ships.

They support a proposal submitted by Liberia, Argentina and Panama which has proposed weakening emission targets and ditching any funding mechanism for the framework involving “direct revenue collection and disbursement”.

Argentina argued that the NZF would harm countries which are far from their export markets and said concerns over that cannot be solved “by magic with guidelines”. They added that, as a result, the NZF itself needs to be fundamentally re-negotiated.

The UCL Energy Institute said that just 24 countries – less than a quarter of those who spoke – said they supported Argentina’s proposal.

While this week’s talks did not see the kind of US threats reported in October, their delegation did leave personalised flyers on every delegate’s desk which were described by academics, negotiators and climate campaigners as misleading.

One witness told Climate Home News that junior US delegates arrived early on Wednesday and placed flyers behind governments’ name plates warning each country of the costs they would incur if the NZF is adopted.

The figures on a selection of leaflets seen by Climate Home News ranged from $100 million for Panama to $3.5 billion for the Netherlands. “They are trying to scare countries away from supporting climate action with one-sided information”, one negotiator told Climate Home News.

They added that the calculations, by the US State Department’s Office of the Chief Economist, ignore the fact that the money raised would be shared to help poorer countries’ transition as well as ignoring the economic costs of failing to address climate change.

Tristan Smith, an academic representing the Institute of Marine Engineering, Science and Technology, told the meeting that the calculations were “opaque” and flawed as they overstate the contribution of fuel cost to trade costs.

A US State Department Spokesperson said in a statement that they “firmly stand behind our estimates” which were shared “in good faith” and to “provide an additional tool to policymakers as they contemplate the true economic burden over the NZF”.

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The gleaming electric motors rolling off the production line at a factory in northeastern England offer an answer to one of the energy transition’s thorniest challenges.

The Advanced Electric Machines (AEM) plant outside Newcastle is at the forefront of building a new generation of motors made without rare earths, a group of 17 nearly indistinguishable metals used to manufacture most of the high-performance permanent magnets that power electric vehicles.

CEO James Widmer, a former aerospace engineer who founded the company in 2017, compares heavy reliance on rare earths in EV motors to the ill-fated decision to add lead to gasoline to resolve a technical issue.

“Putting rare earths in motors is the same thing,” Widmer told Climate Home News in a video call from his office. “You don’t need it, but somebody did it because it was easy.”

Widmer’s firm is among a handful of startup companies working with researchers to eliminate the need for rare earths in magnets and motors – offering a pathway to ease pressure on new mining and refining for one of the world’s most concentrated value chains.

Unease over China’s grip on supplies

As countries strive to reduce their climate-warming emissions by switching to electric transportation, demand for rare earths is soaring. That is increasing pressure for mining new resources and raising concerns about China’s supply chain domination.

China controls more than 90% of global rare earth separation and refining capacity and makes nearly all of the world’s permanent magnets – one of the building blocks of advanced technologies from EV motors and wind turbines vital to the energy transition to microchips, AI data centres and fighter jets.

Beijing spooked Western governments last year when it announced new export restrictions on supplies of rare earths and technological know-how in response to US tariffs on imports of Chinese goods. Automakers were left facing shortages.

While some of Beijing’s retaliatory curbs were suspended within months, China’s willingness to use its industrial clout over technological chokepoints to advance its geopolitical objectives has injected momentum into the efforts of companies such as AEM to find alternatives to rare earths.

“The best way to avoid the problems with these materials…isn’t to drill, baby, drill.The best way is just not to use them in the first place,” said Widmer.

Cutting that dependency would help shrink the environmental footprint of EV motors by keeping costly-to-extract rare earths in the ground, Widmer said.

Rare earth-free motors?

The auto industry had already been manufacturing electric motors using rare earth magnets for 20 years when Widmer set up AEM after conducting PhD research at the University of Newcastle.

Toyota’s Prius model, which is widely recognised as the first mass-produced hybrid passenger car, was launched in 1997 and used rare earth magnets in its motor.

About 80% of modern EV drivetrains now rely on high-performance rare earth permanent magnets to convert electricity into torque, according to a 2024 study, fuelling demand for the metals as EV adoption gains traction across the world, from Europe to South Asia.

Rapid electrification has doubled demand for magnet rare earths since 2015 and it is projected to increase by another 30% by 2030, according to the International Energy Agency (IEA). It recently put the cost of adequately diversifying the supply chain at $60 billion over the next decade.

Demand for EVs and concerns over oil dependence have rocketed back onto the political agenda after the Iran war sparked unprecedented disruptions to global oil markets, reigniting simmering debates about supply chain sovereignty for energy.

Contrary to their name, rare earths are found nearly everywhere on the planet in small quantities. However, larger, economically viable deposits are difficult to find and costly to extract.

On top of the expense, getting rare earths out of the ground is energy-intensive and generates toxic waste and sometimes radioactive by-products. This has led to large-scale environmental damage in China and Myanmar, where unregulated mines have become a major source of rare earth elements and are driving environmental destruction and violence, according to NGOs.

Lighter, greener, less risky

Instead of rare earth magnets, AEM’s motors rely on electrical steel laminations – thin stacked sheets of specialised metal – that create a magnetic field when powered.

The company says its electric motors are more energy-efficient and, in some configurations, more power-dense than traditional rare earth motors and reduce the emissions and polluting waste associated with permanent magnet motor manufacturing processes.

“And we’ve gotten rid of this enormous liability in the supply chain at the same time,” Widmer said.

The company, which manufactures electric motors for passenger cars and trucks as well as for the agricultural and aerospace sectors, expects demand for its technology to grow as buyers become increasingly aware of the risks of supply chain disruption and the environmental harm caused by rare earth mining.

AEM’s motors are already being used in commercial vehicles, for example in truck axles in the Netherlands, and the company aims to expand into new regions through a joint venture with Indian manufacturing firm Sterling Tools, a company spokesperson said.

‘Reinventing the wheel’

Some 8,000 kilometres from AEM’s factory floor, a group of Silicon Valley engineers has been inundated with enquiries since Beijing announced its export restrictions on technologies to mine and smelt rare earths, magnet production and recycling.

As manufacturers worried about shortages, the rare earths supply chain bottleneck became a board-level conversation and executives started scouting for alternatives, said Ankit Somani, a former Google engineer and the co-founder of Conifer.

“Every startup needs an unfair advantage – and that was ours,” he told Climate Home News, adding that the challenge is now to keep up with demand.

The San Francisco-based startup’s technology removes rare earths from electric scooters and small delivery vehicles by placing the motor directly inside the wheel hub, an innovation it describes as “literally reinventing the wheel”.

To transfer power inside vehicles, the company uses a refined form of iron oxide – the same basic compound as rust – known as a ferrite magnet.

Somani said the technology reduces the costs of manufacturing electric vehicles by eliminating the need for expensive rare earth supplies.

Conifer’s first production line already produces 75,000 motor components a year in the city of Pune in western India, the hub of its manufacturing operations, where electric two- and three-wheelers are booming.

To keep up with demand, the company is planning to open a 250,000-unit capacity facility, Somani said.

The next generation of magnets

At Minnesota-based Niron Magnetics, which produces permanent magnets using iron nitride instead of rare earths, vice president Tom Grainger said last year’s supply chain disruption had been a wake-up call.

“What was always possible but never quite material – the risk of geopolitical interference in magnet supply chains – became real in 2025,” he told Climate Home News.

In contrast to magnets that depend on Chinese rare earth supplies, the company’s iron nitride magnets are made from the abundant and inexpensive elements, iron and nitrogen.

Niron estimates that iron nitride magnets could replace roughly two-thirds of the global permanent magnet market.

Niron Magnetics’ first consumer-facing magnet, used in a professional loudspeaker, was rolled out earlier this year and the firm has already received investment from automotive giants General Motors, Stellantis and parts provider Magna International.

The company is developing its first full-scale manufacturing plant in Sartell, Minnesota, which aims to produce up to 1,500 tonnes of magnets annually when it opens in 2027, targeting consumer electronics, as well as the automobile sector, data-centre cooling pumps, robotics and drones.

By Chinese standards, that is a modest start: a typical factory in China can produce between 5,000 and 20,000 tonnes of rare earth magnets, said Grainger. But Niron’s model is designed to be replicated anywhere with basic industrial infrastructure. Unlike rare earth processing, it requires no proximity to a mine or complex chemical permitting.

“The goal…is a factory that has the scale to deliver in sufficient quantities for large programmes – with the economics that come with scale,” Grainger said.

The firm is already looking for a second site in the US to build a 10,000-tonne per year facility, equivalent to approximately 1-2% of the global permanent magnet market share, according to the company.

Governments ramp up support

Anxious to protect their industries from potential supply gaps, Western countries are supporting research into innovative rare earth alternatives.

Jean-Michel Lamarre, a team leader at Canada’s National Research Council, said the government’s science agency, which has been developing rare earth-free motor technologies, is working on using 3D printing to produce magnets.

Lamarre said that while removing rare earths from electric motors significantly reduces the costs of materials, making new designs commercially viable remains a challenge.

Difficulties include scaling up manufacturing capability and responding to rapidly changing market conditions, a spokesperson for Canada’s Department of Natural Resources said.

The US, Canada and the European Union have announced billions in subsidies and financial support to mine and produce more of the materials themselves, as well as funding research on rare earths substitutes. The US government is also investing heavily in American rare earths and magnet producers.

Recycling rare earth elements from discarded computers, motors and wind turbines also has a role to play in boosting domestic production, said Nicola Morley, a professor of materials physics at the University of Sheffield in the UK, who advises major manufacturers including Siemens and Volkswagen.

Recycling alone has the potential to reduce the need for primary rare earths supplies by up to 35% by 2050, according to the IEA.

Today, around 1% of the rare earths used in end-products is recycled because of technical and economic challenges. But startups are seizing on interest in creating circular supply chains that reduce reliance on China.

Better than rare earths

While recycling may be a relatively quick way for major markets to bolster their supplies of magnet metals, some researchers expect scientists to come up with groundbreaking alternatives to rival rare earths within a matter of years.

At Georgetown University in Washington DC, physicist Kai Liu and his team are working to create new materials for magnet production using a machine that bombards atoms of up to six different metals onto a surface simultaneously – like six games of pool played at once. As they land, the atoms bond into new crystal structures, which Liu’s team tests for magnetic properties.

Their research has already led to a discovery of magnet materials, Liu said, adding that he is hopeful for further breakthroughs by the scientific community.

“I am cautiously optimistic that within the next five to 10 years, the community might find something comparable or better than rare earths,” he said.

Main image: An employee working on an AEM motor at the company’s factory outside Newcastle (Photo: Advanced Electric Machines)

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When Shell sold its onshore oil operations in Nigeria to the Renaissance Africa Energy Company last year, the divestment transformed the fossil fuel giant’s climate performance – helping it become the first energy major to report zero routine flaring.

One year on, gas flaring at some of these assets has increased significantly, while Shell has continued to benefit commercially from them, according to a new investigation by nonprofit group Data Desk, shared exclusively with Climate Home News.

Since March 2025, Shell has traded 8 million barrels of oil from the Niger Delta’s Forcados terminal, which was included in the Renaissance deal, Data Desk’s analysis of information supplied by commodities data firm Kpler found.

It is a similar picture at the Bonny terminal, where Shell’s operations were also transferred as part of its onshore exit. Shell is recorded as having traded 3 million barrels of oil from this facility, south of the city of Port Harcourt, since the deal went through.

Multimillion-dollar oil shipments

Using an average 2025 global Brent crude price of $69 per barrel, 11 million barrels of oil shipped from the two terminals since the completion of Shell’s divestment would be worth $759 million.

Shell chartered the tankers carrying the oil to buyers around the world – from Ivory Coast and South Africa, to Canada and Italy, the Kpler data shows.

“Whoever is running Shell’s old oilfields in Nigeria needs to get that oil to market,” said Neil Atkinson, former head of the Oil Industry and Markets Division at the International Energy Agency (IEA).

“So it may well be that while Shell no longer runs a facility, the firm that took it over may have an arrangement to continue selling oil through Shell, thereby making use of their connections and trade networks,” Atkinson said.

Shell’s shipping and chartering arm made a profit of £24.8 million (about $33 million) in 2024, the most recent date available, up from £17 million the year before.

Asked about Shell’s continuing ties to the two terminals, a Shell spokesperson said: “We don’t comment on trading activities or specific customer relationships.”

Renaissance did not address a question from Climate Home News about its ongoing commercial ties with Shell.

Environmental legacy

The new reporting raises fresh questions about how energy majors present their climate performance to investors and consumers, and the environmental legacy they are leaving behind after selling fossil fuel assets in countries such as Nigeria, where Shell has operated for nearly a century.

Many of Shell’s onshore oil fields had been in production for decades by the time the company sold its Nigerian onshore subsidiary over a year ago for $2.4 billion to Renaissance, a consortium of Nigerian companies and an international firm that aims to double oil production by 2030.

Six months after finalising the deal, Renaissance CEO Tony Attah said the company had already boosted output at Shell’s former fields by 100,000 barrels per day.

At the same time, gas flaring increased at most of the fields where the activity was detected, according to Data Desk’s analysis of satellite data, despite Renaissance’s pledges to foster sustainable energy development and protect local communities.

Gas is a by-product of oil drilling. In places that lack infrastructure to process this gas, like the Niger Delta, it gets burned off instead.

Earlier this year, Climate Home News reported on the impact on local communities of increased gas flaring at several other fields in the Niger Delta since they were sold by Shell to different Nigerian companies in recent years.

Besides billowing out toxic chemicals that cause air pollution and wasting a potential energy source, global gas flaring is estimated by the World Bank to release the equivalent of 400 million tonnes of CO2 annually – higher than France’s greenhouse gas emissions each year.

Gas flaring renaissance?

Comparing the year before the sale’s completion to the year after, satellite data shows daily flaring rose at 10 of the 13 Renaissance blocks where it was detected. Flaring fell at two blocks and was unchanged at one other, while five had no detectable flaring in the dataset.

The OML 32 block, located in the heart of the Niger Delta, was one of the assets that Renaissance took over last year. Here, average daily flaring was more than 20 times higher in the year ending March 2026 compared to the year before, according to Data Desk’s analysis of satellite data from the Colorado School of Mines’ Earth Observation Group.

The Renaissance-operated OML 21 and OML 28 onshore blocks saw increases of 390% and 93%, respectively, in average daily flaring in the year after the sale’s completion.

A spokesperson for Renaissance said the company’s environmental management framework included a plan to reduce flaring.

“Renaissance Africa Energy Company Limited has a multi-year gas flaring reduction strategy through its Flare Elimination and Monetisation Plan, developed in accordance with applicable laws and regulations,” the spokesperson said.

Shell’s spokesperson said it “cannot comment on operational matters relating to assets under new owners/operators”, adding that both the company and the Nigerian government had conducted “extensive due diligence” with regard to its divestments in Nigeria.

“Dodging accountability”

Before the deal, Shell said three years ago that its remaining Nigerian assets accounted for about half of the total routine and non-routine flaring in its integrated gas and upstream facilities. Shortly after selling these assets, the company announced it had achieved zero routine flaring – five years ahead of a global 2030 target set by the World Bank.

Shell’s exit from onshore operations in Nigeria followed years of accusations of environmental harm, including oil spills. Residents of two Nigerian communities are currently taking legal action against the oil major in the UK and a trial at the High Court is due to begin next year.

Shell says the majority of spills in the Niger Delta were caused by theft and sabotage and it is therefore not liable.

According to Atkinson, Shell pivoted away from onshore oil fields that “might have become more trouble than they were worth” while remaining a major player in Nigeria’s oil industry.

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The London-based company has invested billions in offshore gas development in the country. It has also retained a 25.6% stake in Nigeria LNG Limited (NLNG), a liquefied natural gas producer based on Bonny Island.

As the world’s biggest fossil fuel companies seek to meet their climate targets, a strategic shift “to dodge accountability” by selling more problematic assets is under way, said Sophie Marjanac, director of legal strategy at the Polluter Pays Project, an organisation that campaigns for the oil industry to cover the cost of its environmental damage.

“By dumping ageing, polluting infrastructure onto smaller operators, they leave behind contamination, and communities facing ongoing harm with little chance of justice,” Marjanac said.

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How Shell is still benefiting from offloaded Niger Delta oil assets