LNG binding producers-consumers together in abruptly changing energy landscape

Speaking at the event, HE Yury Sentyurin emphasised that continued cooperation and dialogue between producers and consumers should be imperative for facilitating investment, reducing cost, and optimising operations across the entire gas value chain.

“Whilst natural gas once again demonstrated its resilience during the most severe woes of Covid-19, LNG cemented its own place due to its veritable economic and environmental advantages during the pandemic-led market shocks. As a result, the delivered volume of LNG in 2020 rose despite all the shipping restrictions, which again indicates the reliability of natural gas during harsh conditions,” said HE Sentyurin.

“An interesting fact to note is that around 61% of GECF’s LNG exports are destined to Asia, which is equivalent to 46% of Asia’s LNG imports. Since Asia is expected to be the driver of global LNG demand, the GECF Member Countries are developing a clear understanding of the needs of Asian buyers to ensure a positive outcome for both parties,” he added.

“As the Forum of the leading gas exporting countries of the world, I can attest that the suppliers of natural gas, particularly LNG, continued to keep the taps on despite all the difficulties they have faced, such as restrictions and project delays, and even covering the shortages of other energy sources.”

However, he warned, the industry is increasingly being challenged by policies slanted against fossil fuels, which may lead to lack of financing and investment across the sector.

“The gas industry has the capacity and tools for decarbonisation so our consumers can meet their energy needs and achieve their climate targets. The decision is ours to make and the potential impact on our environment is immediate.”

It is estimated that 90% of emissions along the LNG supply chain can be mitigated with current technologies.

Opening the Conference, Commissioner Shin said: “Currently LNG and gas prices are high but the world needs LNG as transition energy and to facilitate more renewable energy. Supply shortage of LNG and gas and the lack of necessary upstream developments can cause global supply-demand dislocation (sic) and price hikes, resulting in major disruptions.”

Japan has been a flag-bearer of LNG for decades, using the superchilled fuel to produce electricity for the world’s third-largest economy by nominal GDP. The LNG Producer-Consumer Conference has been successfully organised by METI since 2012. The 10^th anniversary event saw the launch of Asia Natural Gas and Energy Association (ANGEA) in a testament to the rising role of natural gas in erstwhile coal intensive Asian economies. According to the GECF figures, global LNG trade grew by 1.4% y-o-y in 2020, primarily in Asia.

In his keynote, HE Saad Sherida Al-Kaabi, Qatar’s Minister of State for Energy Affairs, Member of the Cabinet, CEO and President of Qatar Petroleum cautioned the world to place science above sentiments and place trust in dialogue.

“There seems to be a grave lack of consensus on what should be done, how and within what timeframe to achieve our environmental targets and aspirations. I believe that the solution to the climate crisis cannot be a kneejerk reaction, such as immediately stopping all fossil fuels and replacing them with renewables, as some have been suggesting. This is not realistic nor reasonable.”

“We need to recognise that the successful energy transition cannot be driven be producers alone. It is a shared responsibility that requires the active collaboration of energy producers, legislatures, governments, and, most importantly, end consumers,” added HE Al-Kaabi from Qatar, one of the 18 leading gas producers comprising the GECF.

According to him, Qatar, the world’s largest exporter of LNG, is transforming its entire LNG value chain with technologies that significantly lower CO2 emissions as it expands its LNG facilities to raise production to 126 mtpa by 2027.

“As an example, we will capture and sequester more than nine million tonnes of CO2 per annum by 2030, placing us firmly on the road of becoming a leader decarbonising their LNG value chain. We also continue to explore investment opportunities and partnerships to realise LNG’s full potential as a key partner to renewables in the energy transition.”

Other GECF Member Countries represented in the prestigious annual event were Angola, Egypt, Malaysia, Norway, and the Russian Federation.

Referring to the newly-established East Mediterranean Gas Forum (EMGF), which is headquartered in Egypt, HE Eng Tarek El Molla, Minister of Petroleum and Mineral Resources of Egypt, in his remarks highlighted that natural gas is much more than fossil fuel and a harbinger of peace. “I can proudly say today that this Egyptian initiative (EMGF) has redefined the role and perception of natural gas from solely a source of energy to a catalyst for peace in the region.”

In his remarks, HE Pavel Sorokin, Deputy Minister of Energy, Russian Federation, asserted that a carbon-conscious world must still find the best possible and the cheapest solution to achieve its climate goals while supporting economic growth. “Gas is one of the possible solutions. It is efficient, it could be transported easily, the market is liquid enough with an LNG boom, and at the same time, the emissions are relatively low.”