We can talk about fuels, but it’s really about carbon intensity of our energy system - Daniel Kalms

Events over the past 12 months have laid bare dependence on natural gas as a vital source of lower carbon energy production. Tightness in the market has seen companies locking into previously seldom found 20-year offtake agreements but what happens beyond 2040? The sector’s progress on methane will prove critical in the future of natural gas as an acceptable energy source. Assuming the sector can effectively eliminate scope 1 methane emissions across operations, what is the role of natural gas as an enabler of a decarbonised energy system? 

Daniel Kalms

Between now and 2050, Kalms said the transition path is not linear, that there will be disruption and shocks. “We know that gas has a contribution in all the
scenarios, but the extent that it contributes is probably driven by its carbon intensity. So, it’s up to us, the industry, to drop that intensity, and it will take a bigger
share.”

He says Woodside’s aspiration is to get natural gas to net zero. “Carbon capture is one part. But before we get to that, we must deal with fugitive emissions.
We must improve the efficiency, our own energy efficiency. You want to eliminate your emissions and, what’s left, you want to capture.” But, if you can, ideally, you
want to utilize the CO2. So, Woodside has invested in technology that is directing carbon into products first. “Natural gas can be liquefied, it can be converted to
methanol, it can be reacted to ammonia, you can reform it to hydrogen. If you’ve got the carbon capture, sequestration, you’ve opened up a number of destinations
for natural gas. And that’s what the industry needs to do.”

Hitoshi Okawa

“Cleaner energy needs to be provided and, actually, LNG is a wonderful solution.” He expects to see greater integration between markets in America, Europe, and
Asia, which will affect how investment and policy plays out in Japan. However, it’s natural go-to for investment and partnership is Australia. “Australia provides us
with the political stability, the financial regime, and legal structure that makes us feel safe to make the investment.”

We expect to see greater integration between American, European, and Asian LNG markets

Arnaud Pieton

Mr. Pieton says Technip Energies is trying to find solutions that deliver infrastructure faster. “We need to be able to answer faster. Shortening time to market so that
there’s actually more gas replacing coal rather than the situation we are facing today.” To him, natural gas is the best way to fight the intermittency of renewables.
But he questions the speed, capabilities and perspective of some governments. In Europe, for example, from Q3 last year to date, the EU will have distributed around €600 billion of subsidies for its population to pay their energy bills. “Imagine if 20% of that was going into more infrastructure around gas.”

He called on policymakers to accept the fact that gas is going to be part of the mix and incentivize it properly so everything can be done in a responsible manner.
He referenced a recent bp project, a gas fired power plant with 99% carbon capture and the infrastructure to sequester the CO2. “Let’s do more of that,” he said. “And let’s force the industry to go into cleaner solutions for making gas more acceptable in the next 2 to 3 decades.” He doesn’t think CCUS is a be-all, end-all solution, but that it is definitely an important contributor on the trajectory, a way to make natural gas more acceptable. Even with the various hurdles he touched on, he feels gas will be accelerating very quickly around the world, especially following the US Inflation Reduction Act.

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Mike Sabel

Mr. Sabel talked about the recent months in Europe as a harsh reminder of how fundamental energy is to survival. “We don’t have the luxury of making a transition to intermittent power, which is unfortunately where we stand with renewables until we have storage.” With a known short list of options (coal, gas, nuclear, and hydro), he said most countries can’t do nuclear or hydro, and both take too long—the short list is really coal and gas, particularly in the emerging world. And the global coal situation is about to get worse.

“Roughly speaking, the coal plants that will turn on in Asia in the next five years, the emissions from just those plants will offset all the emissions abatement of all the renewables in the US and Europe. It’s a disaster.” He believes the US has the gas resources and must lead the way, maintaining policies that will allow it to be brought to market efficiently. “I think it’s a moral imperative that policies support production of gas, that support transparency and predictability of price. Otherwise, you’re going to have a lot of suffering and you’re going to have the de-industrialization of Europe.”

I think it’s a moral imperative that policies support production of gas