"I look at liquefied natural gas (LNG) as if it were a half-full glass of water." Mike k. Wirth, chevron's chairman and chief executive, said at the 19th international LNG conference in Shanghai on April 2. "LNG is cleaner than coal and cheaper than new energy without special subsidies. But on the other hand, LNG is not as green as new energy, nor as cheap as coal. Let's face it.
LNG is natural gas condensed into liquid after desulfurization, decarbonization, dehydration and removal of impurities. Its volume is only 1/625 of the same volume of natural gas, making it a cleaner, more efficient and safer energy source. LNG, after coal and oil, has become a global energy "new star" attracting worldwide attention.
The triennial international LNG conference, hailed as an Olympic event for the LNG industry, was held in China for the first time this year and was attended by more than 250 international exhibitors from over 80 countries and 11,000 guests from over 550 companies. Speakers on the first day of the conference included the chief executives of the world's top oil and gas companies, including chevron, exxonmobil, shell and total.
These global oil and gas "bosses" are generally optimistic about the position of LNG in the future energy structure.
Darren w. Woods, chairman and chief executive of exxon mobil corp., said: 'our optimism about LNG and natural gas is based on the growth of the global economy, the growth of the middle class, and the increased demand for energy.' On the other hand, people worry about climate change and seek low-carbon energy. LNG and natural gas provide economic, reliable and clean solutions that contribute to economic development and improved livelihoods.
"If you look at the solutions that exist, they all fall short in terms of carbon emissions. People need a new combination that meets environmental needs without disrupting economic development. Natural gas is going to play a big role. "Woodgren said.
Ben van Beurden, chief executive of royal Dutch shell, the world's largest LNG supplier, said shell had recently issued its third LNG outlook report. The first forecast strong demand growth, the second forecast a possible supply shortage in the mid-2020s, and the third forecast that demand growth remained strong and supply shortages were looming.
Total chairman and chief executive Patrick Pouyanne says natural gas could play a significant role in building clean, reliable and economical energy sources in the next decade. Total therefore developed it into a core business.
In 2018, total completed its acquisition of Engie's upstream LNG business, becoming the world's second-largest LNG producer. In the future, total is expected to have more gas than oil.
However, Mr Pan stressed that they are not only producers but also global LNG "players". To cover the entire value chain, total has integrated natural gas production, sales and power generation.
Enhance the competitiveness of LNG
However, the bright future of LNG will not come unannounced, with speakers pointing out some of the industry's challenges and sharing possible solutions.
'in the long run, it's hard to see what's holding back demand and supply for LNG and natural gas,' he said. But in the short term, growth will not be smooth, and the ebb and flow of supply and demand will cause price fluctuations. The industry is ready for this. "Trade is another issue. Production is different from user, which depends on the efficiency of trade. I think the future is definitely feasible, but there may be some turbulence in the short term.
Werth goes on to use the "half-full" metaphor: "we need to become more competitive on price when developing large projects, and we need to confront the environmental footprint of natural gas. We need to address this across the value chain, looking for new technologies for carbon capture or sequestration. This is what our industry has been doing, trying to be more efficient and environmentally friendly in whatever projects we develop. So we're optimistic."
In the past, werth has talked about how companies like chevron and mobil built operating service stations and distribution terminals to nurture the market in the oil age. As the industry matured and investment flowed in, the oil and gas majors withdrew from these segments on a large scale. As LNG producers now, they may also need to invest downstream, drive infrastructure, build markets, and bring value to consumers through their products.
"I would also like to emphasize the importance of building innovative partnerships. Different types of partnerships will ultimately facilitate the evolution and globalization of markets. Everyone has to find their place in the global value chain. "I think it's important to look beyond the business models of the past and think creatively about the business models of the future. Voss said.
Open up the emerging LNG market
In developing emerging markets, it is especially important to improve the economic and environmental competitiveness of LNG in all aspects. Van beurden talks about three different kinds of new markets. The first is new users in emerging markets such as China. The second category is new USES such as transportation; The third category is the untapped LNG market.
He believes the industry needs to work in three directions: first, improve the economics of natural gas. That is to do a good job in cost control, so that it can be competitive and attractive while ensuring safety. For example, Canadian LNG projects reduce costs by using modular construction and industry standard packages to avoid over-complication.
Second, the industry needs to convince people of the environmental benefits of natural gas. "We all know that natural gas is cleaner than coal, 45 to 55 percent less greenhouse gas emissions and 10 percent less air pollutants when it comes to power generation. Meanwhile, gas turbines start and shut down quickly, and natural gas is an ideal partner for intermittent renewable energy. But we also need to reduce methane emissions within the industry.
In the past, werth has talked about how companies like chevron and mobil built operating service stations and distribution terminals to nurture the market in the oil age. As the industry matured and investment flowed in, the oil and gas majors withdrew from these segments on a large scale. As LNG producers now, they may also need to invest downstream, drive infrastructure, build markets, and bring value to consumers through their products.
"I would also like to emphasize the importance of building innovative partnerships. Different types of partnerships will ultimately facilitate the evolution and globalization of markets. Everyone has to find their place in the global value chain. "I think it's important to look beyond the business models of the past and think creatively about the business models of the future. Voss said.
Open up the emerging LNG market
In developing emerging markets, it is especially important to improve the economic and environmental competitiveness of LNG in all aspects. Van beurden talks about three different kinds of new markets. The first is new users in emerging markets such as China. The second category is new USES such as transportation; The third category is the untapped LNG market.
He believes the industry needs to work in three directions: first, improve the economics of natural gas. That is to do a good job in cost control, so that it can be competitive and attractive while ensuring safety. For example, Canadian LNG projects reduce costs by using modular construction and industry standard packages to avoid over-complication.
Second, the industry needs to convince people of the environmental benefits of natural gas. "We all know that natural gas is cleaner than coal, 45 to 55 percent less greenhouse gas emissions and 10 percent less air pollutants when it comes to power generation. Meanwhile, gas turbines start and shut down quickly, and natural gas is an ideal partner for intermittent renewable energy. But we also need to reduce methane emissions within the industry.
Mr Pan called on LNG players present to work together to optimise global energy logistics: "LNG from yemen to China goes through the Suez Canal, and LNG from Qatar to Poland also goes through the Suez Canal. We can't go on like this. It's a waste of efficiency." He believes that large oil and gas companies often have many overseas production bases, and optimizing logistics is in the interest of all LNG portfolio players around the world.
Source: China petroleum news center
