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Global Voice of Gas

BY THE INTERNATIONAL GAS UNION

ISSUE 3 | VOL 03

EXPLORING

DECARBONISATION

The case for CCUS

in decarbonising

LNG

Veritas: a consistent

approach to

measuring methane

What is

e-methane?

Policy is key for

supporting LNG supply:

MidOcean Energy CEO

Message from

the President

Dear readers, welcome to the third quarterly issue of

the Global Voice of Gas magazine in 2023.

This issue’s release follows the International

Gas Union’s Annual Member Council meeting in

Perth, Australia, on October 19, excellently hosted

by our valued Charter Member, the Australian Gas

Industry Trust working together with support of

the Government of Western Australia. I am very

happy to have had the opportunity to meet with

the representatives of the entire IGU global gas

community face to face in such a key location for

the global gas market, to reﬂect on the year, discuss

future priorities and to shape a stronger global voice

of gas together for 2024.

This was a timely meeting, given the great

uncertainty that the global gas industry must navigate

in the coming years. The massive disparity across

international energy outlooks and scenarios for gas is

challenging the investments necessary for the market

to come to a stable balance. That is why the 2023

Global Gas Report was dedicated to examining this

uncertainty in depth and to explore pathways for

gas in the energy transition. Upon close examination

of various degree scenarios assumptions, it is very

clear that a policy re-think is needed, and the level of

investment in new gas projects today is insucient to

reach an aordable, secure, and sustainable energy

system in 2030 and beyond.

It is also clear that natural gas will continue

playing a key role in the energy transition, while the

gas sector will also continue to decarbonise, and I

urge an aggressive acceleration of deployments in

carbon capture and low-carbon and renewable gases

to make that possible. That will require collaboration

across the gas industry and, importantly, appropriate

policy tools and frameworks, including pricing

emissions and removing barriers to deployment

and access to ﬁnance. With COP 28 just around the

corner, this message is as important as ever.

The second half of 2023 has brought relief

to the gas markets with reduced prices, and the

European storage at nearly full level ahead of

schedule. Yet, the energy crisis has not ended, the

gas markets remain in an unstable equilibrium, as

the price reductions came at a high cost of demand

destruction and the supply in the market remains

very constrained. In this regard, we have seen

positive shifts in focus toward security of supply,

and I commend the excellent eorts by governments,

industry, and customers. However, knowing that

security must work in balance with aordability and

sustainability for a successful energy transition,

further rebalancing is still necessary.

The IGU ﬁrmly believes in the need to cooperate,

as we strive to do across the gas value chain and

across the globe, and in the need to do so better

across the whole energy value chain.

We have only one planet and the global energy

networks are connecting energy industries and the

energy consumers, who want secure, sustainable,

and aordable energy. I am convinced that

decarbonisation of the vast global energy systems is

not going to be possible without productive dialogue,

cooperation, and sophisticated planning based on

achievable targets.

Gas is and will continue to be an essential part

of the global energy ecosystem, and that doesn’t

make us need less renewables and other low-carbon

energy technologies, and it doesn’t mean that we

should not continue to look for ways to reduce our

consumption of energy as a society. However, by

working together we can achieve much more much

faster.

GLOBAL VOICE OF GAS OCTOBER 2023

Contents

From the President .... 2

Editor’s Note ............4

Events ....................6

Regional Update

Africa ............................................... 10

North Asia & Australasia .......................12

Europe ..............................................14

The opinions and views expressed by the authors in this magazine are not necessarily those of IGU, its members or the publisher. While every

care has been taken in the preparation of this magazine, they are not responsible for the authors’ opinions or for any inaccuracies in the articles.

FEATURES

GLOBAL VOICE OF GAS

OCTOBER 2023 3

17 The case for CCUS in

decarbonising LNG

21 LNG: going all-electric

is a site-speciﬁc option

27 Veritas: a consistent

approach to measuring

methane

What is e-methane?

37 Policy is key for

supporting LNG supply:

MidOcean Energy CEO

40 Natural gas has

delivered for Israel

44 A global gas market

that performs

/49

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GlobalVoiceofGasBYTHEINTERNATIONALGASUNIONISSUE3VOL03EXPLORINGDECARBONISATIONThecaseforCCUSVeritas:aconsistentWhatisPolicyiskeyforindecarbonisingapproachtoe-methane?supportingLNGsupply:LNGmeasuringmethaneMidOceanEnergyCEOMessagefromthePresidentDearreaders,welcometothethirdquarterlyissueofThesecondhalfof2023hasbroughtrelieftheGlobalVoiceofGasmagazinein2023.tothegasmarketswithreducedprices,andtheEuropeanstorageatnearlyfulllevelaheadofThisissue’sreleasefollowstheInternationalschedule.Yet,theenergycrisishasnotended,theGasUnion’sAnnualMemberCouncilmeetingingasmarketsremaininanunstableequilibrium,asPerth,Australia,onOctober19,excellentlyhostedthepricereductionscameatahighcostofdemandbyourvaluedCharterMember,theAustralianGasdestructionandthesupplyinthemarketremainsIndustryTrustworkingtogetherwithsupportofveryconstrained.Inthisregard,wehaveseentheGovernmentofWesternAustralia.Iamverypositiveshiftsinfocustowardsecurityofsupply,happytohavehadtheopportunitytomeetwithandIcommendtheexcellenteffortsbygovernments,therepresentativesoftheentireIGUglobalgasindustry,andcustomers.However,knowingthatcommunityfacetofaceinsuchakeylocationforsecuritymustworkinbalancewithaffordabilityandtheglobalgasmarket,toreflectontheyear,discusssustainabilityforasuccessfulenergytransition,futureprioritiesandtoshapeastrongerglobalvoicefurtherrebalancingisstillnecessary.ofgastogetherfor2024.TheIGUfirmlybelievesintheneedtocooperate,Thiswasatimelymeeting,giventhegreataswestrivetodoacrossthegasvaluechainanduncertaintythattheglobalgasindustrymustnavigateacrosstheglobe,andintheneedtodosobetterinthecomingyears.Themassivedisparityacrossacrossthewholeenergyvaluechain.internationalenergyoutlooksandscenariosforgasischallengingtheinvestmentsnecessaryforthemarketWehaveonlyoneplanetandtheglobalenergytocometoastablebalance.Thatiswhythe2023networksareconnectingenergyindustriesandtheGlobalGasReportwasdedicatedtoexaminingthisenergyconsumers,whowantsecure,sustainable,uncertaintyindepthandtoexplorepathwaysforandaffordableenergy.Iamconvincedthatgasintheenergytransition.Uponcloseexaminationdecarbonisationofthevastglobalenergysystemsisofvariousdegreescenariosassumptions,itisverynotgoingtobepossiblewithoutproductivedialogue,clearthatapolicyre-thinkisneeded,andthelevelofcooperation,andsophisticatedplanningbasedoninvestmentinnewgasprojectstodayisinsufficienttoachievabletargets.reachanaffordable,secure,andsustainableenergysystemin2030andbeyond.Gasisandwillcontinuetobeanessentialpartoftheglobalenergyecosystem,andthatdoesn’tItisalsoclearthatnaturalgaswillcontinuemakeusneedlessrenewablesandotherlow-carbonplayingakeyroleintheenergytransition,whiletheenergytechnologies,anditdoesn’tmeanthatwegassectorwillalsocontinuetodecarbonise,andIshouldnotcontinuetolookforwaystoreduceoururgeanaggressiveaccelerationofdeploymentsinconsumptionofenergyasasociety.However,bycarboncaptureandlow-carbonandrenewablegasesworkingtogetherwecanachievemuchmoremuchtomakethatpossible.Thatwillrequirecollaborationfaster.acrossthegasindustryand,importantly,appropriatepolicytoolsandframeworks,includingpricingemissionsandremovingbarrierstodeploymentandaccesstofinance.WithCOP28justaroundthecorner,thismessageisasimportantasever.2GLOBALVOICEOFGASOCTOBER2023ContentsFEATURES17ThecaseforCCUSin30Whatise-methane?44AglobalgasmarketdecarbonisingLNGthatperforms21LNG:goingall-electric37Policyiskeyforisasite-specificoptionsupportingLNGsupply:MidOceanEnergyCEO27Veritas:aconsistent40NaturalgashasapproachtomeasuringdeliveredforIsraelmethaneFromthePresident.....2RegionalUpdateEditor’sNote.............4Events.....................6Africa................................................10NorthAsia&Australasia........................12Europe...............................................14TheopinionsandviewsexpressedbytheauthorsinthismagazinearenotnecessarilythoseofIGU,itsmembersorthepublisher.Whileeverycarehasbeentakeninthepreparationofthismagazine,theyarenotresponsiblefortheauthors’opinionsorforanyinaccuraciesinthearticles.OCTOBER2023GLOBALVOICEOFGAS3Editors’NoteWelcometothe13thissueoftheGlobalVoiceofGassuitabilityofCCUSasadecarbonisationoptionmagazine,anInternationalGasUnionpublication,variesgreatlyacrossthegassupplychain,andthatproducedincollaborationwithNaturalGasWorlditisimportanttoconsidergeography,government(NGW).Thereleaseofthisissuecomesjustweekspolicy,andlocalindustrialcontextwhenplanningandaheadofthekeyenergytransitionmilestone,theUNdevelopingprojects.TheissuethenmovesontotheCOP28climatesummittakingplaceintheUnitedcaseforusingall-electricdrivesasameansofreducingArabEmiratesthroughthestartofDecember,whereemissionsatLNGplants,andhowtheemissionsworldleaderswillconvenetomeasureprogressreductionsthatareachievabledifferbasedonhowthathasbeenmadeinrealisingthegoalsofthecleanagivencountry’spowergridis.ParisAgreement.TheworldisalreadyawarethatthestocktakemaycomebacklessthanperfectforWearealsoproudtoincludeaninterviewwithprogressingtheenergytransition,particularlyasAmandaHarmon,SeniorManageratGTIEnergy,emissionscontinuedtorisein2022andtheenergyontheorganisation’sVeritasinitiative–asetofcrisisforcedmanynationstoresorttomorecoalstandardised,science-based,technology-neutralandoilburning,astheylookedforalternativestoprotocolsforgettingatruemeasurementofmethanemitigatethesurgingpricesofnaturalgas.However,emissionsassociatedwiththenaturalgasindustry.whatwillmattermostaretheconclusionsdrawnInaddition,wegiveourthankstoKokiHayakawa,fromthatandthedecisionsmadeonhowtocourse-SecretaryGeneralandSeniorManagingDirectorofcorrect,whiletheemissionsreductiontargetsaretheJapaneseGasAssociation,forsharingJapan’sstillwithinreach.Optimally,thesedecisionswillbeexperienceindevelopinge-methaneasameansofinclusive,pragmatic,technology-neutral,takingintoachievingaseamlesstransitiontoadecarbonisedaccountthefundamentalsofglobalenergy,capital,society,loweringemissionswhilesupportingsecureandcapacityendowments,tosettheworldupforanenergysupplyandmakinguseofexistinggasachievablesuccess.infrastructure.Itisclearthatnaturalgasandthelow-carbonDelaReyVenter,CEOofLNGplayerMidOceangaseousenergyatlargemustberecognisedintheseEnergy,alsojoinedusforaninterview,inwhichhepoliciesfortheircriticalroleintheglobalenergyelaboratedontheroleofpolicyinrestoringthebalancetransition.AstheworldlookstoreduceemissionsinintheglobalLNGmarketandbringingmoresupplypower,buildings,industry,andthetransportsectors,tokeepupwithdemand,whiledrivingreductionsinwhiledrasticallyscalingintermittentrenewableemissions.Furthermore,YossiRosen,Chairmanofthegeneration,thereliability,flexibility,efficiency,andIsraeliInstituteofEnergyandEnvironment,meanwhilecost-effectivenessofgasmakeitanunmatchedtakesusthroughthetransformationalimpactthatresourceforasustainedandsustainabletransition.naturalgashashadonIsraelsincedevelopmentbeganGasremainsthemostcost-effectiveavailableadecadeago.resourceforgridresiliency,heavyindustrialactivity,and,inmanyregions,forenergyinbuildings.WealsoprovideasummaryofthemainfindingsoftheInternationalGasUnion’sWholesaleGasPriceButthisissueofGVGfocusesonhowtheSurvey2023,whichtracksthechangesingaspricingenvironmentalvaluecanbefurtherenhanced,byovertheyears,whiledemonstratingthecriticalityofaaddressingmethaneemissionsmoreaggressively,well-functioningglobalgasmarketatwork.deployinglow-carbontechnologiessuchascarboncaptureutilisationandstorage(CCUS)andTatianaKhanberg,electrification,andsupportingthedevelopmentoflow-carbongasessuchashydrogen,e-methaneandStrategicCommunicationsandbiomethane.MembershipDirector,IGUWebegintheissuebylookingintoanewJosephMurphy,reportfortheGlobalGasInnovationRoundtable,establishedthisyearwithsupportfromtheCanadianEditor,NaturalGasWorldGasAssociation(CGA),whichconcludesthatthe4GLOBALVOICEOFGASOCTOBER2023-EVENTSTimetocometogetherRODNEYCOXandcollaborateonDirectorofEvents,thesolutionsandInternationalGasUnioninnovationsthatgasesdeliverThetwooccasionswhenconferencesareattheirMAY13-16,2024WWW.IGRC2024.COMmostpowerfularewhenanindustryhaschallengesoropportunities.TodayourindustryfacesbothandIGU’sPRESENTEDBYHOSTEDBYFlagshipEventsareattheforefrontofdeliveringtheknowledgeandwisdomneededtosecureourfuture.IGRC2024–Earlybirdregistrationnowopen!FirstupisIGRC2024,IGU’sInternationalGasResearchConference–IGRC2024,tobeheldinSaveonregistrationbeforeNovember15,2023CanadainMay2024.Withsomanyofthesolutionsandinnovationsrequiredcomingfromresearch,InternationalGasResearchConference2024,IGU’sdevelopmentandinnovation,thetimingcouldnotbeflagshipevent,isbeingheldfromMay13-16,2024betterforIGRC2024andIencourageyoutocheckattheFairmontBanffSprings,Canada.JoinusintheoutthebenefitsforyourcompanyfromyouattendingheartofthemajesticCanadianRockies,aUNESCOtocollaborateandlearnalongsideyourpeersfromWorldHeritageSite,foradynamicglobalconferencearoundtheworld.bringingtogetherthelatestresearch,leadingpracticesandtransformativeinsightsthatfuelinnovationwithinLookingahead,weareabouttoopentheCallforthenaturalgasandgaseousenergyindustry.AllofthisAbstractsforWGC2025Beijing.WiththeCallforwhileyouenjoyanexceptionaldelegateexperience.AbstractsopeninginNovembernowisthetimetostartdiscussionswithyourcolleaguesandyourcompanyonInnovationiscriticaltokeepnaturalgasareliable,submittinganabstract.Formoredetails,andtoensureaffordable,andlow-emissionsourceofenergy.youarekeptuptodate,emailtheWGC2025team.Finally,wetakeamomenttolookbackonLNG2023inVancouverinJuly.QuitesimplythemosteffectiveeventallyearfortheglobalLNGindustry.AsMichaelStoppardfromS&PGlobalCommodityInsightsobserved,“LNG2023separatedthesignalfromthenoise.”ThisiswhatIGU’sflagshipeventsdobest.6GLOBALVOICEOFGASOCTOBER2023EVENTSIGRC2024isexpandingitsfocusontechnicalresearchcontactusatigrc2024@cga.ca.IGUmemberscanalsotoincludegasclean-tech,technologystart-ups,andcontactSimonPolledriattheIGUSecretariatonsimon.socialinnovation–alltoshowcaseglobalexamplesofpolledri@igu.orginnovationanditspositiveimpactonboththesectorandsocieties.IGRC2024offersauniqueopportunityforprofessionalsintheglobalgasandgaseousenergysectorstoconnect,collaborateanddelveintothecriticalroleofgasanditsinfrastructureinaddressingcomplexenergychallengesworldwide.EarlyBirdRegistrationisnowopen,untilNovember15,2023.Byregisteringtoday,youwill:•Saveonregistration:registerbeforeNovember15,PresentedByHostPartner:2023,andunlocksavingsof$250USD.WGC2025–CallforAbstracts•Accessthefullprogramme:youwillhaveexclusiveopenssoonaccesstoacomprehensiveprogrammethatincludeshigh-calibretechnicalsessions,strategicandIGU’sWorldGasConference,WGC2025Beijing,thought-provokingplenaries,leadershipdialoguesprovidesauniqueopportunitytocontributeyouretc.experience,knowledgeandwisdom,andcollaboratewithyourpeersfromaroundtheworld.TheCallfor•Attendkeynotespeakersessions:GaininvaluableAbstractsforWGC2025opensinNovember2023,toinsightsfromourkeynotespeakers,whoaregloballyprovideampletimeforyoutoexploreyouroptionsandrenownedexperts.Theirenlighteningsessionsdiscusswithinyourcompany.willhighlightthepivotalrolegasinnovationhasonsocietiesandindustries.Therangeofthemeswillensurethatthereisanopportunityforeveryindustryprofessionaltosubmit.•Discovercutting-edgeresearch:DiveintoFromdevelopinganddeployingnewtechnologiesgroundbreakingresearchpresentedduringour(fromE&Ptoutilisation),throughsupply,demand,technicalsessionsandposterpresentations.You’llpricingandmarketing,thenewmomentumforLNG,exploreleadingindustrypracticesanddiscovertotransformation(whetherdigitaltechnologiesorthetransformativeinsightsthataredrivinginnovationadoptionofnewgases),thereisanopportunityforyouwithinthegasindustry.toleadthediscussionandmakeyourcontributiontoasustainablefutureforourindustry.•Meetinnovativeexhibitors:beattheforefrontofthegasindustry’sinnovation,bywitnessingleadingForenquiriesregardingWGC2025CallforAbstractstechnologydisplayedbyourexhibitors.submissionsandtoensureyoureceiveregularlyupdatedinformationemailtheWGC2025team.•ExperienceCanada:immerseyourselfinCanadiancultureduringourthreenetworkingreceptions,whereconnectionsandcollaborationswillthrive.Registertodayandbepartofthisessentialdialogue.EarlyBirdRegistrationclosesonNovember15,2023.JoinusatIGRC2024:Connect.Collaborate.Innovate.Findoutmore!ScantheQRcodetoaccesstheIGRC2024Registrationpage.ThereyouwillfindallEarlyBirdRegistrationdetails.Ifyourequireadditionalassistance,pleaseOCTOBER2023GLOBALVOICEOFGAS7LNG2023–fuellingasecureenergyItwasinthiscontextthatthecorethemeoffutureLNG2023—FuellingaSecureEnergyFuture—wasdecided.Theconference’ssub-themesoffuellingInJuly,thousandsofdelegatesfrom80countriesamorestable,cleaner,andmoreprosperousfuturegatheredinVancouver,Canada,forLNG2023,the20thforallrecognisedthatenergysecurity,environmentaleditionoftheworld’slargesttriennialLNGconferencesustainability,andaffordabilitymustallbebalancedtoandexhibition.achievesmoothenergytransition.Asoneconferencespeakernoted,ifweleantoohardinonedirection,weMuchhadtranspiredsinceLNG2019Shanghai,riskacollapseoftheothers.China.FromCOVID-19throughfalteringsupplychains,andrisinginflationtothecuttingofpipelinegastoLNG2023continuedthelonghistoryofbringingEurope–countriesgrappledwithenergysecurityandtogetherseniorindustryleaders,governmentsupplyissues.representatives,technicalexperts,andkeystakeholders.Thedailydiscussionswererich,lively,pragmatic,and,aboveall,optimistic.TheLNGsectoriswellversedininnovation,andLNG2023attendeesexpressedgreatconfidencethattheindustrywillcontinuetouseitsstrengthsincreatingsolutions.CheckoutsomeofthekeyoutcomesfromtheClosingPlenary.WenowlookaheadtoLNG2026inDoha,Qatar.LNG2023continuedthelonghistoryofbringingtogetherseniorindustryleaders,governmentrepresentatives,technicalexperts,andkeystakeholders.8GLOBALVOICEOFGASOCTOBER2023SempraInfrastructureisnotthesamecompanyastheCaliforniautilities,SanDiegoGas&Electriccompany(SDG&E)orSouthernCaliforniaGasCompany(SoCalGas),andSempraInfrastructureisnotregulatedbytheCaliforniaPublicUtilitiesCommission.©2023SempraInfrastructure.Allcopyrightandtrademarkrightsreserved.REGIONALUPDATEAfricaAfrica’snaturalgasproductionandconsumption(bcm)KHALEDABUBAKRChairman,EgyptianGasAssociation.300ExecutiveChairman,TAQAArabiaandIGURegionalCoordinator250259168.5162.5NorthAfrica:Italyiscountingonthe200regiontoreplacelostRussiansupply,whileMoroccoisresortingtoLNGimportsand150249IsraelispreparingtorampupsuppliestoEgypt.10050020222021PRODUCTIONCONSUMPTION»EniexpectsNorthAfrica–namelyAlgeria,EgyptandLibyaAfrica’snaturalgastrade(bcm)–tobeItaly’smaingassupplierforthenextfewyears,helping60itreplacelostRussianvolumes.TheItalianenergygroupintendstoinvest$3.5bnoverfouryearsinexplorationand58developmentinEgypt.53.9»MoroccoismeanwhileturningtoLNGimportsafterlosing40itspipelinedeliveriesfromneighbouringAlgeria,which209.4soughttousethosedeliveriesasleverageinthedisputeovertheWesternSahararegion.Itspowerandwaterutility9.62022ONEEsignedinJulyadealwithShelltosecure0.5bcmaofregasifiedLNGfor12years.Thecountry’splanstodevelop0morerenewablesaremovingaheadslowly,suggestinggaswillplayakeyroleinitsintendedphase-outofcoal.2021LNGEXPORTSLNGIMPORTSFORTOTALMIDDLEEAST&AFRICA»Israelisworkingtoexpandnaturalgasproductionatthe»EniislookingtobuildasecondfloatingLNG(FLNG)plantinoffshoreTamarfieldandincreaseexporttoEgypt.ThoseMozambiquetotaptheabundantgasreservesintheRovumaexportsaresettoriseby38.7bcmover11years,whilebasin.TheItalianmajor,workingwithExxonMobil,GalpTamar’soutputisexpectedtogrow60%or6bcmannuallyEnergia,ChinaNationalPetroleumCorp.andKoreaGas,from2026.Egyptneedstheextragas,facedwithgrowingoperatestheCoralSulFLNGprojectoffMozambiquethatdemandfromitspopulationof105mnanda9%year-on-yearcameonlinein2022.ItbelievesasecondFLNGunitcoulddeclineinproductioninJanuary-Maythisyear,or12%versusreplicateCoralSul’ssuccess.CoralSulFLNGisexpectedthesameperiodof2021.Thecountryhasgrappledwithtoproduce450bcmofgasintotal,liquefying3.4MTPAforpowershortagesasheatwaveshavedrivenupdemandforexport.cooling.»Kenyahascompletedadealtorevampthedefunctstate-EastAfrica:EniiseyeingasecondFLNGprojectoffMozambique,andKenyaissettoownedKenyaPetroleumRefineriesLtd(KPRL),pavingthewaybuildagaspipetoTanzania.foragaspipelinetobebuiltfromMombasatoDaresSalaam,inTanzania.InMay2021,TanzanianPresidentSamiaHassan10GLOBALVOICEOFGASOCTOBER2023REGIONALUPDATEMoroccoismeanwhileturningtoLNGimportsafterlosingitspipelinedeliveriesfromneighbouringAlgeria,whichsoughttousethosedeliveriesasleverageinthedisputeovertheWesternSahararegion.andherthen-KenyancounterpartUhuruKenyattasignedtransportnearly3bcfdofgasperdayalongtheWestoffonapreliminaryagreementcoveringthetransportofAfricancoasttoMoroccoandEurope,runningovergasfromTanzaniaforuseinpowergeneration,cooking,7,000km,benefittingover400mnpeopleinWestAfrica.andheating.»EnihasbegunoilandgasproductionatthegiantWestAfrica:MorecountriesaresigninguptotheNigeria-MoroccogaspipelineBaleinefieldindeepwatersoffshoreIvoryCoast.Theproject,EnihasstartedproductionatfirstphaseofdevelopmentinvolvesusingaproductiontheBaleinefieldofftheIvoryCoastandstorageandoffloadingvesselcapableofhandlinguptoNigeria’sNNPChassignedapreliminary15,000barrelsperdayofoiland24mcfdofgas.TheagreementontheUTMFLNGproject.secondphase,ontracktostartbytheendof2024,willincreaseoutputto50,000bpofoiland70mcfdofgas,»FourmoreAfricancountries–Côted’Ivoire,Liberia,followedbyathirdthatwillraiseitto150,000bpdand200mcfdrespectively.Guinea,andBenin–havesignedmemorandaofunderstandingwithMoroccoandNigeriatotakepart»NigerianNationalPetroleumCorp.(NNPC)hassignedintheflagshipNigeria-Moroccogaspipelineproject,bringingthetotalnumberofcountriesparticipatingaheadofagreementwithUTMOffshoreLtd.fortheto12.BesidesMoroccoandNigeria,theothersareUTMFLNGproject.TheplannedFLNGvesselwillMauritania,Senegal,Gambia,Guinea-Bissau,Sierraproduce176mcfdofgasfromtheoffshoreYohoField.LeoneandGhana.ThepipelineisexpectedtoincreaseNNPCwillhavea20%equitystakeintheproject.Theaccesstoenergy,improvelivingconditionsandsupportFLNG,duetobecompletedby2026,willcomprisetheintegrationofregionaleconomies.Itisdesignedtoaturretmooringsystem,gaspretreatmentmodules,LNGproductionmodules,livingquarters,andpowergenerationandutilitiesalongsidestorageandoffloading.OCTOBER2023GLOBALVOICEOFGAS11REGIONALUPDATENorthAsia&»WhenthepossiblestrikesatthreeAustralianLNGplantsAustralasiawerereportedonAugust9,theJKMpricetemporarilySATOSHIYOSHIDAexceeded$12permmBtu,butitiscurrentlyinthe$11perSeniorAdviser,JapanGasAssociation,mmBturange.ThisisbecauseglobalLNGsupplycapacityisandIGURegionalCoordinator.strainedbecauseofalackofinvestmentandRussiancutsingasflowtoEurope.HighLNGdemandinEuropecontinuestoimpactAsia.»Ontheotherhand,JKMhasreturnedtoitstypicalpremium»Asia’sLNGsuppliesarelargelyinfluencedbythedemandtoTTF–currentlycloseto$2permmBtu,duetoEurope’sabundanceofgasinundergroundstorage.fornaturalgasinEurope.Inrecentyears,AsiancountrieshavebeenunabletoprocureLNGatalowerpriceduetoEurope’sWhileChineseLNGdemandremainssharplyrisingdemandtoreplacenaturalgaslostfromRussiasluggish,thecountryisexpandingitsimportanddelaysinnewLNGprojects.portfoliotocoverlong-termdemand.»InsomepartsofAsia,highLNGpriceshaveledtoa»China’sdomesticgasproductioninJanuary-Maywas97.3clearreturntocoal,whichisaffordable,abundantandbcm(71.5MT),up5.3%yearonyear,whileLNGimportsavailable,andthishasbecomeamajorobstacletoachievingcameto27.5MT,up4.0%yearonyear.Pipelinegasimportsdecarbonisationthroughashiftfromcoal-firedtogas-firedtotaled18.8MT,up2.3%yearonyear.LNGimportsin2023powergeneration.areexpectedtoreach69MT,whichis5MTmorethanin2022,thankstonewlong-termsupplycontractskickingin.»Nevertheless,newmarketsinAsiaareopeningthemselves»JKMmaybedeclining,butpipelinegasisstillcheaperanduptoLNG,andpioneeringcompaniesinJapanandKoreaarecontributingtheiraccumulatedknowledge,experiencedomesticgasandcoalproductionisrisingstrongly.China’sandexpertisetosupportthediffusionofnaturalgasandLNGeconomyisstillrecoveringfromtheimpactofCOVID-19andintheregion–fuelsthatareindispensabletounderpinthedoesnotneedtopurchaselargevolumesofspotLNGatthisintroductionofmorerenewableenergy.time.Despitedeclineinthelastyear,LNGprices»Ontheotherhand,Chinaissteadilyexpandingitslong-termremainhighversushistoricallevels,andvolatile.LNGimportportfoliotocoverfuturedemand.InNovember2022,Sinopecsigneda4MTPA,27-yearsalesandpurchase»JKMLNGpricesremainhighlydependentonTTFprices.agreement(SPA)withQatar,andinApril2023,itacquireda1.25%stakeintheNorthFieldEast(NFE)expansionproject.Withtheincreasingbuild-upofinventoriesinEuropesinceInJune,CNPCalsosignedaSPAunderthesameregimeandearlyonintheyear,bothJKMandTTFaremuchloweracquiredaninterest.thantheywerelastyear,butstillhighcomparedwithhistoricnorms.JKMisdoublethelevelofpreviousyears»InMay,PetroChinaandBPeachacquired2bcmaofreceivingcapacityfor20yearsfromOctober2026,followingtheexpansionoftheGateLNGreceivingterminalintheNetherlands.ChinaisgainingafirmfootholdintheglobalLNGtrade.»AlsoinMay,theHongKongLNGprojectwaslaunched.ThegaswillbedeliveredfromanFSRUmooredatanoffshoreberthtotwoonshorepowerplants.CLPPower,whichis12GLOBALVOICEOFGASOCTOBER2023REGIONALUPDATEleadingtheproject,hasalreadysignedalong-termLNGSouthKoreaareexpectedtodeclineinthefutureduetopurchaseagreementwithShellfor1.2MTPAoflNGforthegaspricehikeinMay.10yearsstartingin2020,withcommercialoperationsscheduledtostartinJuly.»LNGimportsareforecasttodeclineslightlyin2023,»IncludingtheTangshanLNGreceivingterminal,whichby1MT,duetothecommissioningofthe1.4-GWShinHanul-1and1.4-GWShinHanul-2nuclearreactorsinstartedoperationsattheendofJune,thenumberofDecember2022andSeptember2023respectively.LNGreceivingterminalsinChinahasreached25,withareceivingcapacityof120MTPA.However,importshaveAustraliangovernmentrollsoutkeynotincreasedasexpectedinrecentyearsandcapacitypolicies,includingtargetedemissionsutilisationisexpectedtoremainlow.reductionsatgasfacilities.JapaneseLNGimportsarefallingfast,»Underthenewgovernment,importantpolicieshaveandtherestartofmorenuclearplantswillfurtherdampendemand.beenannounced,includingawholesalegaspricecapandgassecurityguidelines.»LNGdemandwassluggishinthefirsthalfof2023due»InJuly2023,theAustralianSafeguardMechanismwilltocontinuedhighinventoriesfromthesummerof2022,mildweather,astrongrecoveryinnuclearpoweroutputcomeintoeffect,requiring215facilities,includinggasandsubduedgasdemand.productionfacilities,thatemitmorethan100,000TofCO2peryeartoreduceCO2emissionsby4.9%annually.»Onanannualbasis,LNGimportsareestimatedtoIfthetargetisnotmet,operatorsmustuseAustralianCarbonCreditUnits(ACCUs)tofillthegap.declinesignificantlyto64MTPAin2023,from73MTPAin2022.Afurtherdecreaseto55MTPAisenvisagedby2030,accordingtotheSixthStrategicEnergyPlan(2021).Halfoftheestimateddeclinewasachievedinasingleyear.»InJuly,theTakahama826-MWnuclearreactorsno.1and2resumedoperationforthefirsttimein12yearsafterFukushima.Takahamawasbuiltin1974.AfterFukushima,newregulationsrestrictedtheoperationofnuclearpowerplantsover40yearsold.However,bymeetingcertaincriteria,thesenuclearpowerplantsover40yearsoldcanextendoperationupto60years.Takahamaisthesecondnuclearpowerplanttooperateformorethan40years.TherestartofthesenuclearpowerplantswillfurtherdampenthedemandforLNGforpowergeneration.HigherpricesandincreasednuclearalsoweighdownonSouthKoreangasconsumption.»GassalestoresidentialandindustrialcustomersinOCTOBER2023GLOBALVOICEOFGAS13REGIONALUPDATEEurope»Nevertheless,theuncertaintiesregardingRussianpipeDIDIERHOLLEAUXgasandLNGflowandtheconsciousnessthatthesecurityofPresidentEurogas,ExecutiveVicenaturalgassupplytoEuropeisn’tguaranteedifthewinterisPresidentEngieandIGUcold,havemeantthatvolatilityontheEuropeanmarketandRegionalCoordinator.thereforetheglobalLNGmarketremainshigh.Forinstance,thethreatofastrikeonsomeLNGfacilitiesinAustraliainDespitehighlevelsofgasinstorage,theSeptemberhadasignificantimpactontheshorttermgasrisksofapotentiallycoldwinterandapricesinEurope.furthercutinRussiangassupplymeanthatmarketvolatilityremainshigh.»Globallytheshort-termpricesinEuropehavehoveredin»AspartofthefalloutfromtheRussia-Ukraineconflict,gasthepastmonthsinthe€30-40perMWhrange,farbelowthepeaksofabove€300perMWhseenin2022,butstillaboutsupplytoEuroperemainsseverelyconstrained,withRussiantwicetheusuallevelseenin2010-2020.TheprojectedpricepipegasdeliveriestotheEUbeingrestrictedto25bcmafor2024ofaround€50perMWhstillshowsthatmarketcurrently,versus140bcmain2021.Thisgasisflowingthroughplayersconsiderahighriskofanunbalance.UkraineandTurkstream,andthereisgrowingspeculationaboutwhatwillhappenwhenGazpromandUkraine’stransitConsumptionremainslow,dentedbylastcontractendsinDecember2024.year’shighprices.Therearefewerlong-termLNGsupplycontractsbeingsignedthisyear,»ThedropinRussianflowhastoalargeextentbeenandthereareindicationsthattheimpactoftheEuropeanCommission’sjointpurchasingcompensatedbyextraLNGimports–around50bcmamoremechanismhasbeenonlymodest..thanin2021.ThatincludesmoreLNGfromRussia–some15-20bcma.NeitherRussianoritsEuropeancustomersseemto»Highpricesandthelowlevelofeconomicactivityinmanybeconsideringacutinthissupply,asLNGisaglobalmarketandtheredirectionofRussianLNGtotheAsianmarketswouldcountriesinEurope,someofwhicharesufferingrecessions,havealimitedglobalimpact(includingonprices).Ontheothermeanthatgasconsumptionremains10-25%belowthehand,itremainstobeseenifNovatekcanstartArctic-2LNGaverageof2017-2021.Thisdropistheresultofgreaterenergyplantasearlyas2024/2025andifsuchisthecase,whereefficiency,voluntaryreductionsbycustomerslookingtocutthesecargoeswillgo.theirenergybillsandavoidsupplydisruptions,anddemanddestruction,intheformofsomeindustrialplantsclosingdown»Duetoamild2022/2023winterinEuropeandrelativelylowin2022.demandinAsia,theLNGmarketin2023isnotastightasit»Afterawaveoflong-termLNGcontractsdedicatedtowasinthepreviousyear.LNGimportstoEuropeinJulyandAugustthisyear,forinstance,werebelowthe2022level.Europeweresignedin2022andearly2023,thelastsixmonthshavebeenquieteronthisfront,anditisclearthatonly»EuropehasbeenabletorefillitsgasstoragefacilitiestoasmallshareofthemissingRussiansupplyhasbeenreplacedwithlong-termLNGsupply.Morecontractsmaybesignedinveryclosetoitsmaximumcapacity,reaching94%bymid-thecomingmonth,butthisslowdownincontractualactivitySeptember,surpassingthe90%byNovember1EUdeadline.seemstosignalaclearanddeliberatechoicebysomeutilitiesEuropeantradershavealsobeenstoringsomegasinthetostickwithsuppliesonashort-termbasis.ThischoicecanwesternUkrainianundergroundstorages.beexplainedbyfearstheyhaveofhavingtoomuchgassupplyafter2040,whenEUgasconsumptionwillprobablydecreasesharply.Europeanbuyersareessentiallyacceptingthepriceriskoverthevolumerisk.»Theso-called“jointpurchasingmechanism”launchedbythe14GLOBALVOICEOFGASOCTOBER2023HighpricesandthelowlevelofeconomicactivityinmanycountriesinEurope,someofwhicharesufferingrecessions...EuropeanCommissionwasfinallyreducedtoa“demandoftheplayersinthisareaanticipatethattheEU35bcmaaggregationtool”(akindofdatingplatformbetweenobjectiveforproductionby2030shouldbeoverachieved.buyersandsellers).Ithasbeenasuccessintermsofmatchingupbuyersandnewpotentialsuppliers.ButinThereremainsintenselegislativeandtermsofhowmanycontractswereactuallysigned,itsregulatoryactivityaffectingtheEuropeansuccessappearsmodest,tosaytheleast.Theimpactonenergymarket.pricesorgasimportvolumesisimperceptible.»ThelegislativeandregulatoryactivityinEuroperemainsTheexpansionofgasinfrastructurehaspracticallyeliminatedphysicalveryintensive,withmostofthetextsofthe“Fitfor55”constraintsonLNGimports,whiletheandthegasandhydrogenpackagesoflegislationcomingoutlookforbiogasandbiomethanetothefinalstageofdecision-making.Electricitymarketproductionlookspromising.reformisalsostillahottopicfordiscussion.»EnoughFSRUshavebeenputinplacein2022and»Regardingmethaneemissionsregulation,theEuropeanearly2023topracticallyeliminateanyrestrictiontoLNGgasindustryisinsistingthatEuropealonecannotdefineimportsintotheEU.Nevertheless,someinfrastructurerulesforthewholeworld.Weneedtofindawayfor(bothpipelineandregasification)whichweredecidedlastallimporterstocoordinatetheireffortstowardstheiryeararestillunderconstruction,includingsomefixedsupplierstoimprovetheirperformance.WealsoonshoreterminalsinGermanytopermanentlyreplacetheneedanappropriategovernancestructureregardingFSRUs.Someoftheseterminalswillalsobedesignedtomethanemonitoring,reportingandverificationtoavoidimporte-fuels,suchashydrogen,e-ammonia,e-LNGandfragmentationofthemarket.Inthatregard,theinitiativee-methanol.ThisconstructionprogrammedemonstratesbytheUSDepartmentofEnergytoconsultwithEuropeanthatmostEuropeanplayersconsiderthattherewillstakeholdersonthistopiciswelcome.benoreturntothestatuquoanteofthepre-wargasmarket.Howevertheconflictisresolved,theEuropean»Finally,theproposalbytheEuropeanCommissiontogasindustryneedstoadjusttoverylimitedgasflowfromRussiaandlatersignificantimportsofgreengasfromthetransformanumberoftheemergencymeasures,adoptedrestoftheworld.lastyeartofacetheenergycrisis,intopermanenttoolshasmetalukewarmreceptionbytheindustry,who»InsidetheEU,theconstructionofproductionplantsconsidersthatemergencymeasuresshouldbeusedonlyinemergencysituations.forbiogasandbiomethaneremainsverydynamic.MostOCTOBER2023GLOBALVOICEOFGAS15EarlyBirdRegistrationnowopen!InternationalGasResearchConference2024Banff,AB,CanadaMay13-16,2024BANFFMAY13-16,2024WWW.IGRC2024.ORGSave15%–byregisteringbeforeNovember15,2023JoinusinBanff,Canada,fromMay13–16,RegisterbyNovember15,2023,to:2024andexperienceIGRC2024,adynamicglobalconferenceforinnovators,academics,•SaveUS$250–15%discountofffulldelegatefee.andresearchorganizations.Uncoverbreakthroughresearch,leadingpractices,•Haveexclusiveaccesstoacomprehensiveprogramandtransformativeinsightsfuellinggasthatincludesstrategicsessions,thought-provokinginnovationwhileenjoyinganexceptionalplenaries,andenlighteninglunchkeynotes.delegateexperienceintheheartoftheCanadianRockies.•Diveintogroundbreakingresearchpresentedduringourtechnicalsessionsandposterpresentations.RegisternowforIGRC2024:•Beattheforefrontofthegasindustry'sinnovation,Connect.Collaborate.Innovate.bywitnessingleadingtechnologydisplayedbyourexhibitors.•ImmerseyourselfinCanadiancultureduringourthreenetworkingreceptions,whereconnectionsandcollaborationswillthrive.StayConnected!Gettimelyinformationonallimportantupdates,includingconferenceprogrammedevelopment,speakers,keynotes,plenaries,andtechnicaltoursinformation.@IGRC2024IGRC2024www.igrc2024.orgThecaseforCCUSindecarbonisingLNGAnewreportpreparedfortheGlobalGasInnovationRoundtableconcludesthesuitabilityofCCUSasadecarbonisationoptionvariesgreatlyacrossthesupplychain,andgreatlydependsongeography,governmentpolicyandlocalindustrialcontext.Butitshouldbestronglyconsideredasapotentialsolution.JOSEPHMURPHYThereisnoone-size-fits-alloptiontodecarbonisingTherehasbeenarapidriseindevelopmentsincethen,theLNGsupplychain,butcarboncapturestorageandhowever,with30commercialfacilitiesupandrunningbyutilisation(CCUS)shouldbestronglyconsideredasSeptember2022andnearly90pilotanddemonstrationpartofasuiteofsolutions,areportpreparedbythefacilitiescompleted.ThereportattributesthisincreasedCanadaWestFoundationfortheGlobalGasInnovationmomentumtotechnologicaladvances,privateandpublicRoundtable,releasedinJune,found.sectorclimatecommitmentsandfavourablegovernmentpolicy.CCUSiswidelyrecognisedascriticaltoreachingalow-emissionsfuture,includingbytheIntergovernmentalToday,CCUSisatechnologythat“hasbeenPanelonClimateChange(IPCC),theInternationalEnergydemonstratedtobesafe,effectiveandscalable,”thereportAgency(IEA),theUNFrameConventiononClimateconcludes.Butitcautionsthat“substantialchallengesexistChange(UNFCCC)andtheWorldResourcesInstitute–bothtechnicalandfinancial.”(WRI).Andthetechnologyisnotnew–sincethe1920sCO2hasbeenremovedaswastefromrawnaturalgas“Asaresult,thesuitabilityofCCUScomparedtowhenitisprocessed,andsincethe1970s,capturedCO2otherdecarbonisationoptions(suchaselectrificationorhasbeeninjectedintooilreservoirstoboostrecovery.fuelswitching)dependsgreatlyonspecificcircumstancesThissaid,only10commercialCCUSfacilitieswereinthatareshapedbygeography,governmentpolicyandoperationby2010,withacombinedcapacityofonly13localindustrialcontext,”itstates.“TheLNGindustryMTofCO2.facesimmensepressuretoreduceemissionsquicklyandmassively.AsaproventechnologythatcanbeeasilyOCTOBER2023GLOBALVOICEOFGAS17Figure1Source:CCUSasaToolforLNGInnovation,preparedfortheGlobalGasInnovationRoundtableintegratedintoLNGprocesses,producersshouldthereforebecutthrougheitherpre-orpost-combustionstronglyconsiderCCUSaspartofasuiteofsolutionstotechnologies.achievedecarbonisationgoals.”ThentherearelessthangoodfitsforCCUS,suchasVariedsuitabilityLNGshipping,whichistechnicallyfeasibilitybutstillataveryearlystageofdevelopment,accordingtothereport,ThesuitabilityofCCUSasadecarbonisationsolutionwhichcitesafeasibilitystudyandapilotprojectcarriedvariesgreatlyacrossfromtheLNGsupplychain,theoutbytheOil&GasClimateInitiative(OGCI)onaStenareportstresses.bulkmediumrangetanker.TheearlyconclusionsfromthatresearcharethatcapitalandoperatingexpensesThetechnologyisparticularlywell-suitedfornaturalareasignificantchallenge,andsootherdecarbonisationgasprocessing,asCO2hastoberemovedfromgasoptionssuchasfuelswitchingorusingsailstolimitfuelbeforeitisliquefiedatthisstageanyway,andsothereneedsarelikelytobemoresuitable.islittletonoaddedcost.Theonlyaddedcostrelatestosequestering,whichiswhyCCUSisalreadydeployedEvenlesssuitableistransportationofgas,typicallyorduetobedeployedatmanyprocessingfacilitiesviapipeline,andatreceiving,storageandregasificationglobally.infrastructure.Emissionsfromtransportationusuallyoccuratsmallfacilitieslikecompressorstationsthat“Thereisaverystrongvaluepropositionforusingarespacedoutacrossthetransportroute.Assuch,theCCUSfornaturalgasprocessing,”thereportargues.reportconcludesthatCCUShereisimpractical.TheIEAindicatesthatelectrificationisabetteroption.CCUSisalsoagoodcandidateforliquefaction,becauseemissionsattheseplantsarehighandEmissionsfromregasificationarerelativelylow,concentratedinasinglelocation.ThetechnologycanmakingthecaseforCCUSweak.Furthermore,thereduceemissionsassociatedwithliquefactionbyasprocessistypicallybeyondthezoneofcontrolofLNGmuchas90%,accordingto2021researchbyEdinburgh-proponents,thereportnotes.basedWoodMackenzie.Itcanbedeployedsuccessfullyatanumberofliquefactionplantsglobally,includingatTheleastapplicablepartofthesupplychainforRasLaffaninQatar,SnovhitinNorwayandGorgoninCCUSisupstreamgasproduction–whereCO2isemittedAustralia.fromdispersedwellsites.CO2canbecapturedatliquefactionplantseitherThereportalsoemphasisesthatthreequartersoffromthefluegasfromgasturbinesusedtogenerateemissionsalongtheLNGlifecycleareassociatedwithpower,orfromemissionsreleasedfrompowertheend-usecombustionofthegas,meaningthisisgenerationfortherestofthefacilities.Emissionscanan“excellentfit”forCCUS,dependingongeological18GLOBALVOICEOFGASOCTOBER2023conditionsinthearea.ButtheseemissionsareusuallyprovidingdirectorindirectsupportthroughdifferentoutsidethecontroloftheLNGproducer.methods.TheUSforexampleprimarilyusesataxcredit,whileEUsupporthingesmostlyongrantsandloans.GovernmentactionIndirectsupportcanalsocomeintheformofcarbonoffsetmarketsandsupportfortheproductionofblueWhilethevalueofCCUSisclear,thereportcautionshydrogen.Anotheroptionistherestrictionorpricingofthatprojectsarestillcomplexandexpensivetorealise.emissions,asemitterswillbewillingtobearCCUScostsThe5-MTPANorthernLights/LongshipdevelopmentiftheyarelowerthanthetaxorpenaltiestheywillavoidinNorwaythatissettobeginoperationsnextyear,forbyadoptingthetechnology.example,willcost$1.6bn.Thissaid,costsarefallingthankstotheknowledgeobtainedfromfrontrunnerOnthelegalfront,governmentscanalsosupportprojectssuchasQuestCCSinAlberta,Canada,whoseCCUSbydevelopingframeworkstosimplifythecomplexdevelopersestimatewouldhave30%lesswereitquestionsoverpropertyrightsandwhoownsormaydevelopedagain.RecentstudiesdemonstratethattheaccessthespacesbetweenrockparticlesunderthetechnologywillbeevencheaperandmoreefficientinsurfacewhereCO2canbesequestered.thefuture,addingthatfurthercost-savingswillcomefromtheuseofsharedinfrastructuremodelsthatcreates“Thetake-awaymessageisthatgovernmentscanuseeconomiesofscale,thereportnotes.arangeofdirectandindirectpolicyapproachestohelpCCUSadoption,”thereportsaid.“GiventhatCCUSisFortunately,governmentsrecognisethehighcostexpensive,thissupportwilllikelybeneededinalmostallofinitialtechnologydeployment,andmanyarenowcasestomakeCCUSviableforLNGprojects.”TheLNGindustryfacesimmensepressuretoreduceemissionsquicklyandmassively.AsaproventechnologythatcanbeeasilyintegratedintoLNGprocesses,producersshouldstronglyconsiderCCUSaspartofasuiteofsolutionstoachievedecarbonisationgoals.AbouttheTheGlobalGasInnovationRoundtable,establishedthisyearwithsupportGlobalGasfromtheCanadianGasAssociation(CGA),statesthatitsmissionis“toInnovationensurethatgovernments,policymakers,multilateralinstitutionsandRoundtableenergythoughtleadershaveagreaterunderstandingofthetechnologyandinnovationunderwaythatwillimprovetheperformance–environmentalandotherwise–ofthegassector.”“Itwillraisetheprofileofgastechnologyandinnovationthroughavarietyofliveanddigitaltouchpoints,includingthesharingofleadingpractices,highlightingemergingtechnologyresearchandinnovation,andprofilingthearrayofeventsunderwayatanytimearoundtheworld,”itsays.OCTOBER2023GLOBALVOICEOFGAS19LNG:goingall-electricisasite-specificoptionAll-electricdrivesareakeymeansofreducingLNG’scarbonfootprint,butchoosingtheoptiondependsonmultiplefactors,notleasttheavailabilityoflowcarbonpowertogainitsfullgreenhousegas(GHG)benefits.ROSSMCCRACKENTheMelkøyaLNGplantinNorwaywasthefirsttotheincentivetoreduceittoanabsoluteminimum.installall-electricdrivetrains,whichmaysurprisesomeAlthoughthepictureismuddiedbysanctions,thereadersfollowingthecurrentdebateovertheplant’selectrification.Italreadyiselectric.importanceofreliabilityandreducedmaintenanceinremotelocationswillalsohavebeenafactorinRussianMelkøya’sthreeelectricdrivetrainshaveatotalLNGproducerNovatek’sdecisiontotransitiontoelectricinstalledcapacityof180MW.TwodrivesforrefrigerationdrivesforthesecondandthirdlinesofitsArctic-2LNGhave2x65MW+32MW,whileonedrivehas16MWforproject–despitetheadditionalcostofhavingtobuildnitrogenremoval.gas-firedplanttopowerthem.ThedecisionbytheNorwegiangovernmentinAugustReliabilitybenefitstosupporttheplant’sconnectiontothegridconcernsthesourceandcarbonfootprintoftheelectricityconsumedAtypicalgasturbinehasaminormaintenanceperiodbytheplant.ofabout4,000hoursandamajormaintenancecycleof20,000hours,whileanelectricdrivehasminorandThereasoningbehindthedecisiontogoall-electricmajormaintenanceperiodsof25,000and100,000wasbasedonthehigherefficiency,flexibilityandhoursrespectively.Inaddition,theminormaintenancereliabilityofelectricdrives,comparedwithdirectly-downtimeforgasturbinesistypically6-10daysversuscoupledheavy-dutygasturbines.Melkøyaislandisinthe1-2daysforelectric.farnorthofNorway480kmabovetheArcticCircleclosetothesourceofitsgasfeedstockintheBarentsSea.TheGas-powereddrivesalsoloseefficiencyasremotelocationmeansthatbothplannedandunplannedtemperaturesincrease,whereaselectricdrivesdonot.Inmaintenanceisdifficultandtimeconsuming,increasingQatar’smegatrains,SiemensROBICONPerfectHarmonyOCTOBER2023GLOBALVOICEOFGAS21Figure1:Figure2:ElectricitygenerationinNorway,2022(TWh)ElectricitygenerationinAustralia,2022(TWh)0.33.85Hydro0.317.1SolarWind14.8Hydro46.338.8OtherRESSolarCoal127.6Wind31.7GasOtherRES3.2OilConventionalSources130.945-MWvariablefrequencydrivesareusedtomoderateplant,includingcarboncaptureandstorage(CCS),buttheperformanceofthegasturbines,addingadditionaleventuallyfoundthatbecauseofthecostofintegratingapowerinhotsummertemperaturesandreturningexcessnewCCSunit,additionalelectrificationprovidedthebestpowergenerationinwintertothegrid.emissionsreductionpathway.ThereasoningisimportantbecausenewLNGplantscanbedesignedinwhichThrowinthehigherefficiencyofelectricmotorsCCSisanintegralpartoftheengineering,reducingtheoverawiderangeofoperations,andtheutilityofcomplexitiesofretrofitting.verticalshaftdrivesinquicklyfinetuningoperationstorequirements,andtheadvantagesofbeingall-electricAsaresult,Equinorisbackingasolutioninwhichthestarttomountup.gas-firedpowerplantwhichcurrentlysuppliespowertotheplantisshutdownandelectricityissourcedfromCarbonfootprintthegrid.However,howtheelectricdrivesarepowerediscriticalLowcarbongridpowerwhencarbonemissionsareconcerned.Thishighlightsanotherlocation-specificcondition.Opencyclegasturbines(OCGTs),whichmightbeNorwegiangridelectricityisverylowcarbonbecausethepreferredoptionintermsofcapitalcostandspeedofdeployment,typicallyproduceabout0.52tonnesofofthedominanceofhydropower(seefigure1).In2022,CO2/MWhofelectricitygenerated.Optingforcombined-hydropowerprovided87%ofthecountry’selectricitycyclegasturbinesreducesthistoaround0.34tofCO2/withafurther10%accountedforbywind.Inaddition,MWh,aconsiderablereductioninemissions.Norwaygenerallyhassurpluspower,exporting25.8TWhin2021,althoughlastyearithadtoconsiderPuttingitanotherway,Germanengineeringcompanysuspendingexportsbecauseoflowreservoirlevels.SiemensestimatesthattheuseofindustrialOCGTscanresultinCO2emissionsashighas250kg/tofLNGThesenear-optimalconditionsintermsoflowcarbonproduced.Thiscanbereducedtoarangeof6-190kg/tgridelectricitysupplyarenotprevalenteverywhere.ofLNG,ifconventionalpowerfacilitiesarecoupledwithrenewableenergyandbatterystoragesystems.TheTheabundanceofhydropowerinBritishColumbialatterprovidesinstantaneousresponseintheeventofawasalsoaclearfactorinLNGCanada’sdecisiontodeviationinpowersupplytoprovidethereliablepoweremployelectricdrivesandgridelectricity,asitisfortherequiredbyanLNGplant.smaller2.1mnt/yrCanadianWoodfibreproject.LNGCanadaphaseoneisunderconstructionandhopestoAtMelkøya,operatorEquinorevaluatedanumberstartshippingLNGwithintwoyears,whileconstructionofoptionstoreduceemissionsandextendthelifeoftheonWoodfibreofficiallybeganinAugust.Theuseof22GLOBALVOICEOFGASOCTOBER2023electricdrivessuppliedbyrenewablepowerwillmeanpropanerefrigerationcompressor’srotationspeedcanbelowcarbonLNGproductionforbothprojects.adjustedwithoutaffectingthecompressorssincetheyarenotcoupledtothesamedriver.Althoughitwillrequireupgrades,WoodfibrehasanelectricityconnectionalreadyinplaceasitisusingTheuseofgridpowermeansthatFreeportLNG’sarepurposedindustrialsiteforitsLNGplant.However,carbonfootprintistiedtothatoftheUSgrid.ItalsowhileLNGCanadahassecuredpowerforthefirstphasemeansoutsourcingthereliabilityofelectricitysupplytoofitsproject,asecondphaseexpansionhasthrownupUSutilitiesandtransmissionsystemoperators,anoptionnewissues.whichmightcauseconcernincountrieswithlowgridreliability.UtilityBCHydrodoesnothavesufficienttransmissioncapacitytosupplytheexpansion.Moreover,LNGCanadaGridcarbonintensitiesisnottheonlyindustrialprojectintheCanadiannorthwestkeentosourcerenewableenergytokeepitsactivitiesasTheUSEnergyInformationAdministration(EIA)hasenvironmentallyfriendlyaspossible.highlightedthehugeGHGemissionsbenefitswhichhaveresultedfromtheUSpowersector’scoal-to-gasThedilemmaovertheavailabilityofrenewablepowerswitching.FurtherreductionsinthecarbonintensityofUShighlightstheinterconnectednessoftheenergytransition.gridpowerseemcertainascoal-firedgenerationdeclinesForLNGplantstoproducelowcarbonLNG,moreandtheamountofrenewableenergycapacityincreases.renewablepowerisneededandintherightplace,whichcanoftenmeannewpowertransmissioninfrastructure.InMay,theEIApresenteditsAnnualEnergyOutlookBCHydrohasopenedconsultationswithstakeholderson2023,whichpositedthreescenariosinwhichcoal-fireditsNorthCoastElectrificationplansandLNGCanadahasdescribedconversationswithgovernmentandtheutilityPoweravailabilityasencouraging.wasonereasonwhyFreeportLNGLowcarbonpowerprovisionintheUSoptedforall-electricdrivesPoweravailabilitywasonereasonwhyFreeportLNGintobuildwhatistheUSoptedforall-electricdrivestobuildwhatisthetheworld’slargestworld’slargestsuchLNGfacility,whileatthesametimesuchLNGfacility,meetingstrictlocalenvironmentalrules,includingGHGwhileatthesameemissionsstandards.GEPowerConversionwasselectedtimemeetingstricttoprovidetheall-electricdrivesfortheplant’sthreelocalenvironmentalLNGtrainsrefrigerantcompressors.Theplanthasatotalrules,includingGHGinstalledelectricalcapacityof675MW.emissionsstandards.EachoftheninesystemsprovidedbyGEPowerConversionhasa75MW2-polesynchronousmotor,thelargesteversuppliedtoanLNGplant,a96MVAstepdowntransformerandan‘e-house’withancillaryelectricalequipment.GEPowerConversionsestimatesthattheelectricdrivesresultedinareductioninsitecombustionemissionsof90%,aswellasanetincreaseinproductionof6.5%,astheuseofelectricityallowsallofthegasenteringthesitetobeusedforLNG.Italsoestimatesthatbecauseofthehigherreliabilityofoperationandreducedmaintenancerequirements,theLNGplantcanproducetheequivalentofanextra10-15daysayear,comparedwiththeuseofconventionalindustrialgasturbines.Thedesignemployedseparatescontrolofthetworefrigerationloopcompressorsfromeachother,andtheOCTOBER2023GLOBALVOICEOFGAS23Thereisnoone-size-fits-alloptionfordecarbonisingLNGproduction,butelectrificationisamonganarrayofpossibilitiesthatoperatorscanconsider.generatingcapacityfallsbybetween52%and88%byCO2andcombustion-relatedemissions.2050.Renewablepowercapacityincreaseshugely,theInaddition,almost50%ofpowerinAustraliaisstilloverallresultbeingsignificantdeclinesinthecarbonintensityofUSgridpower,whichwillfeedthroughintogeneratedfromcoal(seefigure2).Hydroandotherthecarbonfootprintofgridconnectedall-electricUSrenewablesmakeupathirdofpowergeneration,LNGplants.althoughwindandsolargenerationareexpanding.GridpowerisandwillcontinuetobecomelesscarbonHowever,thispossibilityisbynomeansuniversal.intensive,butdoesn’tcurrentlyoffertheemissionsAustraliahassomeoftheworld’shighestemissionLNGreductionswhichwillbenefitLNGCanada,WoodFibreplants.Thisreflects,forsomeprojects,thehighCO2andMelkøya.contentofthegassupplyandthedistancesinvolvedintransmission,whichrequiresenergy-intensiveAsitstands,goingall-electricisagoodoption,butcompression.theemissionsgainsdependheavilyonlocationandthespecificsofeachLNGplant,aswellastheavailabilityofFornewprojects,theadoptionofelectricdrivesreliable,lowcarbongridpower.Asisalwaysthecase,wouldcutemissions,butnotsolvetheproblemofhighthereisnoone-size-fits-alloptionfordecarbonisingCO2contentgas.ThelattermightbetterbedealtwithbyLNGproduction,butelectrificationisamonganarrayofasinglecarbonstorageoptionforbothfeedstockstreampossibilitiesthatoperatorscanconsider.24GLOBALVOICEOFGASOCTOBER2023DecarbonizationSolutionsfortheFullSupplyChainchartindustries.comhowden.comVeritas:aconsistentapproachtomeasuringmethaneGTIEnergyanditspartnersarehoningasetofstandardised,science-based,technology-neutralprotocolsforthenaturalgasindustrytogetatruemeasurementofmethaneemissions.JOSEPHMURPHYForthelasttwoyears,USnot-for-profitGTIEnergyhasdevelopingamethaneemissionintensityvaluebasedonbeencollaboratingwithdozensofoperatorsacrossthetheirmeasuredmethaneemissionsdetectedbyavailablenaturalgassupplychainalongwithotherstakeholders–toolsandtechnologiesthatareoutthere.”fromacademicsandenvironmentalNGOstoinvestors,policymakersandtechnologyproviders–todevelopaTheprotocolscoversixsegmentsofthesupplychain:consistentapproachtomeasuringandverifyingmethaneproduction,gatheringandprocessing,transmissionandemissions.storage,LNGanddistribution.TheresultofthislabourwasthereleaseoftheVeritasThefirstprotocol,isMeasurement,describeshowprotocolsinFebruarythisyear.Thesestandardised,totakemeasurementstoinformemissioninventoriesscience-based,technology-neutralandmeasurementbysegment.MethaneIntensitydefineswhatmethaneprotocolsaredesignedtoassemblemethaneemissionsintensitiesshouldlooklikeforeachsegmentoftheinventoriesthatareverifiedbydirectfieldmeasurements,naturalgassupplychain.Reconciliationreconcilesinturnhelpingtheindustryaddressthoseemissions.Byemission-factororbottom-upinventories–namelythosetheendofthisyear,GTIEnergyaimstopublishaversionavailableundertheUSEnvironmentalProtectionAgency2.0oftheprotocols,informedbyincreasedtestingand(EPA)’sGreenhouseGasReportingProgramme–withanalysis,whichAmandaHarmon,GTIEnergy’ssenioractualmeasurementsbysegment.Thefourth,Supplymanagerthatisdirectingtheinitiative,expectswillbeChainSummation,bringstogetherestimatesfrommultipleclosetothefinalversion.segmentstocalculateanoverallemissionsintensityforthesupplychain.ThefifthandfinalprotocolisAssurance,“Veritasprovidesameansofgettingameasurement-whichprovidesguidanceforverifyinganemissionsinformedmethaneemissionsintensityforsegmentsacrossinventory,companydocumentationrequirementsandthenaturalgassupplychain,”HarmontellsGlobalVoicethird-partyauditing.ofGas.“Thegoalistoprovideatransparentoperationaltoolforcompaniesalongthatchain,ameansforVeritasisdesignedtosupportcompaniesinusingvariousreportingandemissionreductionframeworks,OCTOBER2023GLOBALVOICEOFGAS27ProductionGatheringProcessing&BoostingLNGCollaborationwiththeTransmissiongasindustryandotherstakeholdershasbeenStorageDistributioncriticalforestablishingtheVeritasprotocols.suchastheOilandGasMethanePartnership(OGMP)2.0muchlargerthanthat,sothattheprotocolscanbeusedinitiatives,anddifferentiatingtheirgassupplybasedonitsnotjustbyoperatorsbutalsoexternalstakeholders,emissionintensity,sothattheymaymarkettheirgasaswhetheritbeanenvironmentalNGOoraregulatororresponsibly-sourced.aninvestor.”“ThemissingpieceofthepuzzleforOMGP2.0isThenaturalgasindustryhasbeen“incrediblyhowyoucancreatestandardised,measurement-basedsupportive”indevelopingtheprotocols,shesays.informationforsource-levelemissions,”Harmonexplains,andfillingthisgapisacurrentVeritasworkstream.“Theyrecognisetherearealotoftoolsandtechnologiesoutthere,andhowtheycanbestThetechnology-neutralapproachoftheprotocolsisoperationalisethemissomethingtheindustryisverykey,shesays.willingtoputtheeffortinto,intermsoftheirtimeandresources.”“WewantedtokeepanopenmindonwhichmeasurementtechnologiesarebesttouseforeachVeritascurrentlyhas37partners,representingthesegmentandsupportnewtechnologiescomingtotheentirenaturalgasvaluechain,andexternalstakeholders.market,”shesays.BesidesGTIEnergy,HighwoodEmissionsManagementandSLRInternationalarealsoleadingtheinitiative.ATheprotocolsensurethatthemethaneemissionhandfulofcompanieshavealreadyimplementedtheintensityestimateisinformedbyrequiringthatatleastprotocols,butHarmonhopesthatmomentumwillbuildinhalfofthemethaneemissionsaremeasureddirectly,and2024afterVeritas2.0ispublishedthisDecember.havingatechnology-neutralapproachisnecessarytoachievethis.“We’reaimingforVeritastolivethroughthesedifferentotherinitiatives,whethertheyaresingle-companyCollaborationiskeycorporatereportingofemissions,aninternationalgovernment-alignedmethanemeasurementverificationCollaborationwithkeyplayersinnaturalgasandotherframeworkoranemissionreduction,corporatereportingstakeholdershasbeencriticalforestablishingtheVeritasframeworklikeOGMP2.0,”shesays.“That’souraimandprotocols.weanticipatethatthatwilltakeonlyacouplemoreyears,giventhemomentuminthisspace.”“There’ssuchawealthofknowledgeacrosstheindustryinthisspace,fromtheoperatorstoother“Inthisrapidlyevolvingspaceofmethaneemissionsexternalstakeholders,whetheritbeacademics,measurement,it’simportanttobetransparentandtoconsultants,orothers,”Harmonsays.“Thoseprovidethe‘howtouse’forthesetechnologiestocreateperspectiveswereincrediblyimportanttodevelopingtheameasurement-informedmethaneintensityestimate.protocols;wedidnotwanttocreateVeritasinavacuumThedataiscomingthroughthesetechnologiesandthethatwouldonlybesuitableforonetypeofoperatororVeritasprotocolsreallyhelpusmovetowardswhatouronetypeofsegment.Theneedandimpactshouldbeunderstandingofmethaneemissionsare.”28GLOBALVOICEOFGASOCTOBER2023SuccessfullyProducingLNGforOveraHalf-CenturyLiquefiedNaturalGasFromKenaifirstproducingandimportingLNGtoJapanin1969tostartingup17newlarge-scaleLNGtrainson-timeinAustraliaandtheU.S.GulfCoastoverthepasteightyears,theOptimizedCascade®processprovidesmorethan110millionmetrictonsperyearoftheworld’sLNGsupplycapacityandislicensedin27trainsaroundtheworld.TheOptimizedCascade®process:Proudpast,brightfutureWeDeliver:•Industry-leadingperformance,efficiency,andoperationalflexibility•Predictableexecution,startupandoperation•Scalabletraindesignfrom1.5to7MTPA•WidefeedgascompositioncapabilityTheOptimizedCascade®processnowprovidesmoreEPCContractorchoicesforourclientsTolearnmore,visitlnglicensing.conocophillips.com.OptimizedCascade®isaregisteredtrademarkofConocoPhillipsCompanyintheUnitedStatesandcertainothercountries.23-0569©2023.ConocoPhillipsCompany.Allrightsreserved.Whatise-methane?e-methaneisoneofthewaysJapanKOKIHAYAKAWA,SECRETARYcanachieveaseamlesstransitionGENERALANDSENIORtoadecarbonisedsociety,loweringMANAGINGDIRECTOROFTHEemissionswhilesupportingstableenergyJAPANGASASSOCIATIONsupplyandmakinguseofexistinggasinfrastructure.TheJapanGasAssociation(JGA)announcedinisgenerallyreferredtoas“syntheticmethane,”whichisNovember2020its“CarbonNeutralChallenge2050”,tocalled“e-methane.”takeonthechallengeofdecarbonisingJapan’scitygasby2050,followedbythereleaseofits“CarbonNeutralHowdoese-methanework?Challenge2050ActionPlan”inJune2021.ThefeedstockCO2iscapturedfromfluegasoffuelInthe“ActionPlan,”theJGAhasestablishedacombustionsite,biogasmix,oratmosphereandusedforroadmapforachievingcarbonneutralityby2050throughproducinge-methane.Therefore,evenifCO2isemittedathoroughtransitiontonaturalgasandadvanceduseduringcombustion,theamountofCO2intheatmosphereofnaturalgasinthetransitionperiod,aswellastheisnotincreased,contributingtocarbonneutrality.developmentofdecarbonisationtechnologies,theintroductionof“e-methane”throughmethanation,andtheWhyise-methaneoneofthemostuseofbiogasandhydrogen.practicalpathwaystodecarbonisedgassupply?Thisarticledescribeswhate-methaneis,howitworks,andthechallengesinvolved.InJapan,heatenergyaccountsforabout60%ofenergyconsumptioninresidential,commercialandindustrialWhatise-methane?sectors.Therangeofheatthatcanbeproducedwithgasisverywide,andcanreachmuchhighertemperaturesThesynthesisofmethanebyaddingcapturedcarbonthancanbeproducedbyheatpumps.Conversely,thedioxidetohydrogeniscalled“methanation.”decarbonisationofsuchheatenergyisveryimportanttoachievecarbonneutralityinthefuture.Inotherwords,“methanation”isaformofhydrogenutilisationtechnologyandanimportantmeansofdecarbonisinggas.Methaneproducedbymethanation30GLOBALVOICEOFGASOCTOBER2023Inaddition,sincethemaincomponentofnaturalgasathoroughlow-carbontransition,reducingcarbonismethane(CH4),e-methanecanmakeuseofexistingemissionswithoutdisruptingenergysupply.LNGshippingfacilitiesandotherequipmentassameasnaturalgas.And,gasuserscancontinuetousegasTherefore,webelievethatwecancontributetoaapplianceswithoutadditionalinvestment.seamlessdecarbonisationprocessbypromotingsocietaladoptionofe-methaneandgraduallyswitchingfromInaddition,Japanispronetoearthquakesandothernaturalgastoe-methane,whileworkingontheeffectivenaturaldisasterssuchastyphoonsandfloods,“safety”isuseofnaturalgasandthedevelopmentandexpansionofaprerequisite,andpastexperiencesofearthquakesandhigh-efficiency,high-value-addedgassystems.othernaturaldisastershaveproventhattheexistinggasinfrastructureishighlyresilient.Byusingthetechnology,Isthereanotherwaybesidese-methane?wecanhelpimproveresiliencyandcontributetostableenergysupplybyproducinge-methaneusingrecycledToachievecarbonneutralgassupply,weconsidercarbonandrenewableenergysuchasgreenhydrogen.variousoptions,notlimitedtoe-methane,andthedirectuseofhydrogenisamongthem.Basedonthesebenefits,theJGAhasset2030and2050targetsforthegasindustryasalong-termroadmapThedirectsupplyofhydrogeninareassuchascoastalfore-methaneutilisation:morethan1%ofe-methaneindustrialcomplexesisassumedmainlythroughtheinjectionintocitygaspipelinesin2030and90%in2050.constructionofnewsocialinfrastructuresuchashydrogenpipelines.WhyisJapaninterestedinthistechnology?Asforhydrogen,inadditiontoinfrastructurecostissues,therearealsohandlingdifficulties,especiallyDuringthetransitionperiodleadingtothecreationofawhentransportingliquefiedhydrogenfromoverseastodecarbonisedsocietyin2050,itisimportanttopromoteJapanintheformofliquidhydrogen,whichrequiresalotofenergytoliquefyitoncetoatemperaturebelowOCTOBER2023GLOBALVOICEOFGAS31InJapan,whichispronetoearthquakesandothernaturaldisasters,“safety”isaprerequisite,butpastearthquakesandothernaturaldisastershaveproventhattheexistinggasinfrastructureishighlyresilient.-250°CandamorehighlyrigidstoragetankcomparedtoTherearethreeothernon-technicalissuesthatneedthoseusedforLNG.Toaddresstheseissues,webelievetoberesolved:(i)thedevelopmentofCO2countingthatJapanesegascompaniescantakeadvantageoftherules,(ii)theestablishmentofanenvironmentalvaluetechnologyandknow-howtheyhaveaccumulatedbytradingmechanism,and(iii)theestablishmentoffinancialhandlingLNG.supportmeasuresbasedoncostdifferences(introducingamechanismtocompensateforcostdifferencesbasedonInaddition,biogasemitsCO2whenitiscombusted,purchasepricedifferencesbetweene-methaneandLNG).butitisacleanenergysourcebecauseitabsorbsCO2whiletheoriginofbiogasgrowsup,andwebelievethatRegarding“(i)thedevelopmentofCO2countingrules”,thesupplyofcitygasusingexcessbiogasgeneratedfrome-methanedoesnotincreaseCO2emissionsbecausewasteandsewagetreatmentplantsandfoodfactoriesisitonlycirculatesCO2intheatmosphere,butthereareanimportantoption.noaccountingrulesoftheemittedandcapturedCO2.ClearrulesneedtobeestablishedtopromotetheuseofWhatarethechallengesforthesociale-methane.implementationofe-methane?Also,therulesforcountingCO2whene-methaneForthesocialadoptionofe-methane,itisnecessarytoproducedwithCO2captureinonecountryisconsumedincreasethecapacityofplantsanddeveloptechnologiesinanothercountryhavenotbeenfinalisedatthistime,thatcontributetothereductionofproductioncosts,andsointernationallyharmonizedruleswillneedtobevariouseffortsarecurrentlyunderway.developedinthefuture.InJapan,INPEXCorporationhassuccessfullyRegarding“(ii)Environmentalvaluetradingdemonstratedtheproductionof8Nm3/hofe-methanemechanism”,acertificationsystemisneededtoidentifyfrom2017to2021.Currently,INPEXCorporationande-methanewhenitisblendedwithnaturalgasforsupply.OsakaGasCompanyarecollaboratingtoprepareforamethanationdemonstrationatascaled-upplantfromRegarding“(iii)SupportmeasuresbasedoncostFY2025.Theproductioncapacityofthemethanationdifferences”,itisconsiderednecessarytointroduceplanttobedevelopedundertheprojectisplannedtocompensationmechanismforcostdifferences,astherebeapproximately400Nm3/h.Designstudiesfor10,000willbeapricedifferencebetweene-methaneandLNGtoNm3/hand60,000Nm3/hplantswillbeconductedinencouragefirstmoveratthebeginningstage.parallel.Japan’scitygasindustryisworkingwiththepublicInMarch2022,TokyoGaslaunchedademonstrationandprivatesectors,domesticandinternationalinitiatives,projectincooperationwiththecityofYokohamatoutilisetoaddresstheseissuesbypromotingtechnologyCO2fromincinerationplantsandbiogasfromsewagedevelopmentthroughdemonstrationprojects,establishingtreatmentplants.CO2countingrulesandenvironmentalvaluetradingmechanisms,andbuildingappropriatesupportsystems,Inaddition,theresearchanddevelopmentofandwillcontinuetoacceleratetheseefforts.innovativemethanationtechnology,whichisexpectedtofurtherimproveefficiencyandreducecosts,isbeingRegardingtheseissues,thedeclarationofconductedmainlybymajorgasutilitieswiththefinancialintergovernmentalcooperationtopromotee-fuelsandsupportofgovernment.e-methaneintheG7Climate,EnergyandEnvironmentMinisters’CommuniquéatSapporo(Japan)inApril2023isoneofthesignificantstepsforward.32GLOBALVOICEOFGASOCTOBER2023ThepathtoasustainablefuturestartswiththerightpartnerPartnerwithPETRONASandgrowyourbusinessresponsiblywithreliablelower-carbonenergysolutionsBalancingsurgingenergydemandswhileembracingelectriﬁcationofourassets,andembarkedoncarbontheglobalcallforemissionsreductionposesacaptureandstorageprojectsforcarbondioxidesigniﬁcantchallengeformanyindustries.Atsequestrationinouroperations.PETRONAS,weproudlystandasyouridealpartnerinthisjourneytowardalower-carbonenergyfuture.Aboveall,wearedrivenbyapassiontocreatesustainablevalueforbusinesses,societies,andtheWithliqueﬁednaturalgasasourcornerstone,weplanet.Oureortsandactionsresonatewithourpavethewaytoamoresustainabletomorrow.Overpartners'Environmental,Social,andGovernancefourdecades,we'vegrowntobecomeoneofthegoals,withoutcompromisingonenergysecurity.world'slargestsuppliersofnaturalgas,withaglobalTogetherwithPETRONAS,let’sputpassionintoproductioncapacityexceeding40milliontonnesperprogressaswemovetowardsamoresustainableannum.Ourtrackrecordboastsover12,600future.successfuldeliveriestomorethan25countries,atestamentofourcommitmenttocustomers'needs.Connectwithusatlngenquiry@petronas.comAtPETRONAS,customer-centricityliesattheheartoftoprogressyourbusinesseverythingthatwedo.Ourunwaveringcommitmentholisticallyandsustainably.revolvesaroundcraftingtailor-madesolutionsthatcatertoeverycustomers’sustainabilityneeds,PassionateaboutProgressrangingfrominnovativedeliverymethods,pricingoptions,andcontractingapproaches.FromLNGbunkeringtoISOtankdeliveryandship-to-shiptransfers,ourspecializedservicesextendtheadvantagesofLNGaccessibilityfarandwide.AstheﬁrstenergycompanyinSoutheastAsiatopledgeNetZeroCarbonEmissionsby2050,wehavepursuedmultiplepathwaystoreachourgoal.Wehavepledgedzeroroutineﬂaringinnewoildevelopmentsandexistingoilproductionsitesby2030,implementeddigitalsolutionsandprocessequipmentadvancements,investedintheDecarbonisationofLNGFigure1:LNGversusfossilfuelsNaturalgasandLNGareamongthecleanestfossilfuels,evenwhenaccountingforprecombutistionemissionsEmissionsfactorbyfuel,gCO2e/MJ1Emissionsfactorbyfuel,gCO2e/MJ1230.8~130.0100.879.376.589.6~20.8~10.056.8NG/LNGFuelOilCoalNG/LNGFuelOilCoalCombustionPrecombustionSource:McKinseychanges“wellbelow”2.0°Cabovepre-industrialtimes.Amongtraditionalfossilfuels,naturalgasasliquefiedTheenergytransitionistheshiftintheoperationsandprocessesintheglobalenergysectorfromfossil-based,naturalgas(LNG)isthelowestcarbonfuelcurrentlyhighcarbonemissionsystemsofenergyproductionandavailabletoshippingatscaletoday,reducinggreenhouseconsumption—includingoil,naturalgas,andcoal—togas(GHG)emissionsbyupto23%(well-to-wake)renewable,minimalor“netzero”emissionenergysourcescomparedtoVeryLowSulphurFuelOil.Thisisillustratedsuchaswindandsolar,complementedbyenergystorage,inFigure1.suchaslithium-ionbatteries.Theworldisincreasinglycommittedtoa1.5-degreepathway,whichreferstoThecarbonfootprintofLNG(LiquefiedNaturalGas)mitigatingclimatechangethroughdecarbonisationtolimitisameasureofthegreenhousegasemissionsassociatedwarmingto1.5°Cby2050,andtokeeptemperaturewithitsproduction,transportation,anduse.Carbon1Governmentshadpreviouslyagreedtoacttoavoidglobaltemperaturerisegoingabove1.5C.Asof2023theworldhasalreadywarmedby1.1Candnowexpertssaythatitislikelytobreach1.5Cinthe2030s.Thefocusnowwillbeoncomingbackdownasquicklyaspossibleafterovershootingthe1.5degreeCmark.ThisarticleisbroughttoyoubyTheNationalGasCompanyofTrinidadandTobagoLimited(NGC).TheopinionsandviewsexpressedinthisarticledonotnecessarilyreflectthoseoftheIGUorthepublisher.emissionsarereleasedthroughthecombustionofgastoplantandforfuelintheliquefactionprocess.Assuch,drivetheliquefactionprocessandanycarbondioxidehigherefficiencyplantdesignsorusingrenewableenergyremovedbeforeenteringtheplantisoftenventedintotoreplacefeedgascanhelptoreduceemissionsandtheatmosphere.Asaresult,globaleffortsareunderwaydecarbonisetheLNGcomingoutofplantsatanindividualtoreducetheoverallcarbonimpactofLNGuseasitisalevel.Intheupstream,thelargestopportunityfortransitionfuelandwillbepartoftheglobalenergymixdecarbonisationisinreducingCO2venting.Thiscreatesfordecadestocome.However,withtransitionandtheapotentialopportunityforcarboncaptureandstorage,demandforcleanerfuels,thedemandforcleanerLNGwhichcouldcutemissionsbyasmuchas25%.Globally,willonlygrow,withthecarbonfootprintofLNGcargoesseveralLNGprojects—includingSnohvitinNorway,settopotentiallybecomeadifferentiatorforbuyersandGorgoninAustralia,andQatar’sNorthFieldprojects—sellers.Infact,theseareearlydaysfor‘carbon-neutral’areexploringthisoption,althoughitremainsexpensive.orso-called‘green’LNG,assevensuchcargoeshaveLongertermsolutionsthatinvolvedecarbonisationarebeendeliveredoragreed,alltobuyersinAsia,withmoreviatechnologythroughsolutionssuchascarbon-neutralunderstoodtobeunderdiscussion.biogasesandcarbon-neutralsyntheticgas,carboncapture,useandstorageandtheincorporationofThatsaid,‘carbonneutral’doesnotmeanthatthehydrogen.LNGcargocreateszeroemissions.Instead,whatitmeansisthatthecarbonemissionsassociatedwiththeupstreamWithinTrinidadandTobago,effortshavebeenproduction,liquefaction,transportationand,ifrequired,focusedonreducingmethaneemissionsandreducingthecombustionofthegas,isthenmeasured,certified,andwastageofgasmoleculesviareducingflaringupstreamoffsetthroughthepurchaseanduseofcarboncredits,andminimisingemissionsintheupstream,maximisingwhichsupportreforestation,afforestationorothertheefficiencyofthroughputfromtheLNGtrains,andrenewableprojects.Switchingtonaturalgashasalreadygreateremphasisonassetintegritymanagementandhelpedtolimittheriseinglobalemissionssince2010,riskmitigationatLNGproductioninstallations.AsLNGalongsidethedeploymentofrenewables,improvementsdemandcontinuestogrowinthemediumterm,futureinenergyefficiency,andtherelookingofexistingcontractsmaylikelyrequirethatallLNGcargoescometechnologiessuchasnuclearenergy.withdetailedinformationabouttheemissionsassociatedwiththeirproductionanddelivery,alongwithevidenceofPragmatically,themainopportunitytoreducesuppliercarboncredentials.liquefactionemissionsinLNGiswithfeedgas,asroughly8%to12%offeedgasisusedforelectricityintheLNGThisarticleisbroughttoyoubyTheNationalGasCompanyofTrinidadandTobagoLimited(NGC).TheopinionsandviewsexpressedinthisarticledonotnecessarilyreflectthoseoftheIGUorthepublisher.PACHITEASUB-BASINTheShiraMountainsdividethesouthernpartofUcayalibasinintoalargereasternpor�onthatisdepictedinFigure1,andawesternpor�onthatincludestheOxapampa/EnefoldandthrustbeltandthePachiteasub-basin.TheeastwardleadingedgeoftheOxapampa/EnesegmentisdeﬁnedbytheSanMa�asFault,whichtrendroughlyNNW.Thissub-basininturnterminatesintoanolderbasementcoredupli�trendingNorth,theShiraMountains,wherethethrustbeltcollideswiththeShiraMountains,southoftheOxapampawells.Relatedtothepetroleumsystem,intheSub-AndeanFigure1.BasinsofPeru,basedonTOCandRock-Evaldata,Regionalmapshowingnumerousforma�onsfromOrdovicianagetothethePachiteaSubBasinTer�arycanbeiden�ﬁedaspoten�alsourcerocksinandthemainoilandgasthesub-AndeanBasinsofPeru.However,intheevidencesofthePachiteaSubBasincouldbeasfollows:petroleumsysteminthearea.Regionalcrosssec�oninblue.PALEOZOICTRIASSIC/JURASSIC•LatePermianEneForma�onisanimportantcontributorinthe•PucaráGroupisabituminouscarbonatewithMadredeDiosBasinandBoliviafurthertothesouth.interbeddedorganicrichshalesec�ons;•Ambo/Tarma-CopacabanaForma�onswithmarineshalesandTHEPROVENRESERVOIRSINTHEAREAcarbonatesinthesouthernpor�onoftheUcayaliBasin.TheAmbohassourcedthegiantgas/condensateﬁeldsoftheCamiseaArea.•EneForma�on(LowerPermian)•CushabatayForma�on(LowerCretaceous)•OrdovicianContayaandDevonianCabanillasForma�onshave•VivianForma�on(UpperCretaceous)extremematurityandmoderatepresent-dayTOCvaluesintheSEMarañon,andlikethePermiansourceareimportantcontributorsintheMadredeDiosBasinandBolivia.Figure2.A)RegionalStructuralcrosssec�oninthePachiteaSubBasinacrosstheSanMa�asandShiraMountains.(seeloca�oninFigure1)B)2Dpetroleumsystemmodelfromtheprevioussec�on(ModiﬁedfromPERUPETRO,2019)ThemostattractiveareainUcayaliBasiniswithinthefoldandthrustbeltalongitsentiretybutparticularly,intheareaoftheOxapampawellswhereaconsiderablegascolumnhasalreadybeendiscoveredinoneofthewellsasitpresentedinFigure2.Intheforeland,therearestillalargenumberofundrilledstructures.Theﬁnalpointtoemphasizeisthatthisareahasmultiple,maturesourcerocksandthereapparentlyhasbeenlargequantitiesofoilandgasmigratingthroughthesystemasevidencedbythenumerousshowsinmostofthewellsdrilledinthearea.PolicyiskeyforsupportingLNGsupply:MidOceanEnergyCEOPolicyiscriticalforencouragingmoreDELAREYVENTER,investmentinglobalLNGsupplytoCEO,MIDOCEANENERGYkeepupwithdemand,whilealsodrivingreductionsingreenhousegasemissions,DelaReyVenter,CEOofLNGplayerMidOceanEnergy,tellsGVG.JOSEPHMURPHYInvestmentinglobalLNGsupplyhasacceleratedpost-challengeswithexecution.Thewindowoftimetoavoidpandemicandtheindustrynowfindsitselfinan“optimumtheloomingsupplygapbygreenlightingnewprojectsisweatherpattern,”DelaReyVenter,CEOofLNGplayerclosing,hesays.MidOceanEnergy,tellsGlobalVoiceofGas.Buthewarnsthatasupplygapissettoreemergearoundtheendofthe“IfaprojecthasnotreachedFIDby2025,it’snotdecade,urgingpolicymakersandotherstakeholderstodogoingtobeonstreamby2030.”moretokeeptheinvestmentflowing.Importantly,newsupplyprojectsarenotonlyneededDemandhasrecoveredandhighpricesaremakingtokeepupwithdemandgrowthbutalsomakeupforsupplyprojectsmoreattractive,andthereisalsomorefallingproductionatexistingfields,henotes.AndthiswillpoliticalsupportforLNGthaninalongtime,hesays.becomeanevenbiggerissuegoingintothe2030s.Thereisenoughgasinthegroundtofueldemandfordecadesto“ThishasunleashedaprimarilyUSandQatarisupplycome,hesays,butdevelopmentmusthappenfaster.sideresponseataverylargescale,”hesays.“WhatthatmeansisthatoverthemediumtermwewilllikelybeMidOcean,ownedandmanagedbyUSinvestmentfirmquitereasonablysupplied.ButwhenyoulookouttotheEIGpartners,isworkingtobuildupitsownportfolioofendofthedecade,thesupplygapopensupagainandLNGprojects–itiscurrentlyintheprocessofacquiringitbecomesquiteayawninggapaswegotowardstheinterestsinfourAustraliandevelopments.Thisstrategymid-2030s.WearefastmovingoutofthecurrentoptimalgotanimportantvoteofconfidenceinlateSeptember,weathersystem.”whenSaudiAramcostruckadealtoacquireaminoritystakeinMidOceanfor$500mn.AramcohasanoptiontoThereisnotmuchtolookatintermsofsanctionedexpandthatinterestinthefuture,undertheagreement.newsupplyprojectsoutsideNorthAmericaandQatar,henotes,citingpermittingissues,politicalrisksandGenerally,itisgettingincreasinglyhardfortheLNGindustrytosecurefinancing,andthatfinancingitcanOCTOBER2023GLOBALVOICEOFGAS37obtainisgettingmoreexpensive,accordingtoVenter.ButwhenyoulookouttotheWhatcanpolicymakersdo?Theirroleiscriticalforendofthedecade,thesupplygapopensupagainanditunlockingmoreinvestment,hesays.becomesquiteayawninggap“Policymakersareverymuchkeytothisquestion.aswegotowardsthemid-2030s.WearefastmovingoutInvestmentingassupplyisstimulatedbypragmaticofthecurrentoptimalpolicies–policiesthatacknowledgethelong-termroleweathersystem.ofgasasanenableroftheenergytransition,thatsignaltheexpectationofsustainedgasdemandovertimeatDELAREYVENTER,CEO,MIDOCEANENERGYreasonableprices.”environmentalfootprint.Ontheotherhand,whenpolicymakersshuntheCustomersareanothercriticalpartoftheequation,valueofgas,arguingthatitwillonlybeneededforanotherdecadeorsoastheworldmovesonwithitshesays.Theyshouldfocusonworkingwithsuppliersthatdecarbonisationefforts,thatfeedsintobuyers’decisions.effectivelyandtransparentlyquantifytheiremissionsandTheybecomelessconfidentaboutcommittingtosupplyhavethoseestimatesverified.onalong-termbasis,andthisinturnmeanslesscapitalisavailableforsupply,Venterexplains.Thisiswhatwas“Customersshouldbecomeawholelotmoreseeninthelate2010s,hesays,resultingintheglobaldiscerningaboutthegreenhousegasintensityoftheLNGenergycrisiswehavetoday.theybuythantheyaretoday,”hesays.“We’reinaworldwhere,becauseofthesupplyshocks,thepriceorsecurity“Thesewerewell-intendedbutultimatelypoorlyofsupplyissometimesallthatmatters.Butintimeitmustconsideredmessagesfromsomepolicymakers.Iamabesupplementedwithcustomerspositivelydiscriminatingbigbelieverthatinthiswholeequationbetweenpolicy,betweendifferentsourcesofenergybasedontheirmoneyandtheindustry,itispolicythatisthecriticalone.greenhousegasintensity.ThatalsomeansofcourseaItneedstobeattheveryleastpragmatic,andnothostilewillingnesstorewardthosesuppliersthatdotheirbest.”togas.”TheLNGindustryhascomealongwayinaddressingAllthisisvitalforachievinganorderlyandaffordableitsemissionsovertheyears,Ventersays,buttherehasenergytransition,hesays,andnotonethatis“chaotic,beenafailuretocomeupwithoneagreedstandardforpainfulandcostly.”Whilepolicyhasbecomemoremeasuring,reportingandverifyingemissions.Therearepragmaticinresponsetotheenergycrisis,thisisonlyovertwodozenemissionsinitiativesandcoalitionsarounda“half-step–intherightdirectionbutnotenoughtotheworld,“butwhatweneedisone,unifiedapproach,”beacatalystforlong-termenergysupplyatthescalehesays.required.”ThegoodnewsisthatLNGsuppliersnowenjoyaTargetingemissionswidearrayofoptionsfordecarbonisingtheiroperations.Electrificationhascomedownincost,andretrofittingTheotherimportantroleofpolicyisencouragingplantstorunonrenewablepowerisbecomingreductionsingreenhousegas(GHG)emissionsassociatedincreasinglyviable,hesays.CarboncaptureandstoragewithLNGsupply.ThisshouldinvolveaddressingGHG(CCS)isanoptionworthconsidering,dependingonlocalintensityatbothnewandexistingLNGplants,usingaconditions.“carrotandstick”approach,hesays.Inotherwords,alackofoptionsisnolongerthe“Critically,policyshouldalsoincentivisetheprimeconstraint,hesays.Hecallsforahigheranddevelopmentofawholearrayofgasessuchashydrogenpredictablecarbonpricetodrivetheadoptionoftheseandammoniathattodayaresubstantiallylowercarbondecarbonisationoptions.Butoncemore,italsofallsonthanconventionalenergy,”hesays.“Itisonlypolicythatcustomerstodemandlower-carbonLNG.Whenitcomescanplaythiscatalystrole.”tolower-carbongases,VenterdoesnotseemuchsynergyintermsofinfrastructureandsupplychainsbetweenLNGHelamentsthatinrecentyearssomefinancialandhydrogenandammonia.Ontheotherhand,syntheticinstitutionshaverespondedtoenvironmentalsocialLNGrepresents“perfectcompatibilitywithexistinggovernance(ESG)pressurebyscalingbackfundingforinfrastructure,fromliquefactiontofinaluse.”LNG.Ontheotherhand,hepraisesotherfinanciersthat“understandthebiggerpicture”–thatgasisneededasareliablebaseloadenergysupplytounderpintheenergytransition.ThosefinanciershaverespondedtoESGpressurebybecomingmoreselectiveofwhichprojectstheyinvestin,basedonhowwelltheyareaddressingtheir38GLOBALVOICEOFGASOCTOBER2023AnIntegratedNaturalGasSolutionNaturalgasindicesacross130locationsinNorthAmerica.40+dailypowerpriceindicesinon-peakandoff-peakmarkets.Outlooksandstrategicanalysisforpower,gas,LNGandcleanenergymarkets.Newscoverageongasandpowercompanies,infrastructure,policies,andregulations.5-yearshort-termand30-yearlong-termfundamentalsandpriceforecasts.NaturalgashasdeliveredforIsraelIsraelisnowmarkingadecadesinceitsnaturalgasrevolution.Gasdevelopmentoverthattimehasgeneratedsignificanteconomicvalue,whilereducingemissionsthroughthesubstitutionofcoalandotherpollutingfuelsandshieldingthecountryfromthehavocwreakedbytheglobalenergycrisis.YOSSIROSEN,CHAIRMANOFTHEBOARDOFTHEISRAELINSTITUTEOFENERGYANDENVIRONMENTTheglobalenergymarketenduredthebiggestshocksinthatofOECDcountries.Thenumberofpeoplelivinginagenerationin2022.Globalnaturalgaspricessoaredenergy-starvedpovertyworldwidefarexceedstheentiretounprecedentedheights,leadingtoadramaticspikepopulationintheOECD.inelectricityprices.Mostcountriesfelttheshock,butIsraelwasoneofthefewcountriestoweatherthisstormRichindustrialisedcountriesareabletoendure,albeitvirtuallyunscathed,exhibitingremarkableresiliencyintheataheavyeconomiccost,theenergysupplychainissues.faceofthisglobalupheaval.ThiswasadirectoutcomeHowever,itisthecitizensofthenon-OECDcountriesthatofIsrael’snaturalgasrevolution,whichproducedhavebeenbearingthebruntofthecostofthiscrisis.Theyunprecedentedaccomplishments–intermsoftheareunabletopaythesurgingenergybills,theysufferfromeconomy,welfare,theenvironment,andgeostrategy.severeshortfallsinenergyandelectricitysupply,andareevenresortingtoseverely-pollutingenergysourcessuchThedramaticenergycrisesthatbesettheglobalascoal.energymarketthesepastyearshaveproventhatglobalreductionsingreenhousegasemissionsareonlypossibleNaturalgashastheadvantagesofenablingaiftheyoccuralongwiththestrengtheningofthelocalandgreenhousegasreductionprocesswhileatthesameglobalenergysecuritylandscape.timestrengtheninglocalandglobalenergysecurity–firstthroughexpandingtheglobalnaturalgassupplyAchievingthis,while83%oftheworld’spopulationinfrastructure,andthenbyusingthisinfrastructureforthelivesinnon-OECDcountries,isadauntingchallenge.Per-capitaenergyconsumptioninthesecountriesisone-thirdpurposeofCO2-freegases.Israelisnowmarkingadecadesinceitsnaturalgas40GLOBALVOICEOFGASOCTOBER2023Naturalgasreducescost-of-livingTheeconomysavedNIS190bn($47.2bn)asaresultofdramaticreductioninpollutantInthepastdecadethepriceofelectricityforIsraeliemissionsintensityhouseholdshasdroppedby11%,comparedwitha40%increaseinEurope.Areductionof85%intheintensityofSO2emissionintensityand76%intheintensityofnitrogenoxideemissions.RateofChangeofHouseholdElectricityPrices145Baseyear2013135EU-27125+40-%S02Emissions/KWh115100ag/kwh1050.01695850.01485%emissionintensity750.012reductionofNIS71.2billioninpollution0.010Israel0.008-11%57ag/kwh0.00620132014201520162017201820192020202120220.0040.002ContributionofrenewablesEUIsrael020122013201420152016201720182019202020212022TherateofchanceofelectricitypricesinEuropeisbasedonBDOanalysisandNotincludingsavingsfromemissionsintensityEurostatdata;therateofchangeofelectricitypricesinIsraelisbasedonIECdata.Source:BDOanalysisofelectricityeconomyreportsbytheElectricityAuthorityandThepricesincludetaxesandsubsidies.Pricesinlocalcurrency.Averageprices(2013theMinistryofEnvironmentalProtection“GreenBook”.tomid-2022).TheincreaseinelectricitypricesinIsraeloverthepasttwoyearsderivesfromtheincreaseinpriceofimportedcoal.revolution,whichbeganwiththesizableproductionbcmin2023.Israel’snaturalgasproductionduringtheanduseofnaturalgasin2013.Aspecialreportfromsameperiodgrewfrom2bcmto22bcm.IsraelhastheeconomicconsultancyBDO,writtenjointlywiththedevelopedanannualgasproductioncapacityof30bcmAssociationofOilandGasExplorationIndustriesinwithinlessthanadecadethankstothedevelopmentofIsrael,ADecadeofIsrael’sNaturalGasRevolution,hasthreeseparateoffshoregasproductionandgasdeliveryrecentlybeenpublishedandhasgainedconsiderablesystems,independentfromoneanother–fromtheTamar,attention.ThereportreviewsIsrael’snaturalgasleviathanandKarishgasfields–in2013,2019and2022revolutionthispastdecadeintermsofthebenefitandrespectively.valueaspectoverseveralcriticalareascriticaltoanycountry.Israel’spowergenerationsectorhasbeendramaticallyoverhauledtobecometheconsumerofthebulkofRecordsavingsIsrael’snaturalgas.In2012,naturalgasconstitutedamere17%ofthefuelmixinelectricitygeneration.TheThereportstatesthatthankstotheproductionofnaturalremaining83%wasbasedoncoal,Dieselfuelandoil.gasinIsrael,theeconomyhas,overthepasttenyears,Theabout-facewascompletedin2022,whensome68%savedover$90bn.Thisamount,calculatedfrompublicofIsrael’selectricitywasgeneratedbylocally-sourcedrecordsreleasedbytheMinistryofEnergy,theMinistrynaturalgas,while10%camefromrenewablesand22%ofEnvironmentalProtectionandotherbodiesoverthecamefromimportedcoal.years,dividesthesavingsintotwocategories:energycostsavingsduetothereadily-availablenaturalgas,Suchmassiveinfrastructuredevelopmentrequires,estimatedat$36bnandpollutionreductions(externalitybesidesthefundamentaleconomicimperatives,aholisticcosts)duetothesubstitutionofcoalandotherpollutingenablingpolicyregardingdevelopmentofthegasfields.fuelswithlocalnaturalgas,amountingto$54bn.Theper-InIsrael’scase,withinafewshortyearsgasdiscoverieshouseholdsavingsthankstotheuseofnaturalgasoverweremadetotaling1,000bcm.Thesefindscameasathepastdecadehavetotalledapproximately$35,000surprisetolocalindustry,thegovernmentandregulatory(morethan60%ofthe2022percapitaGDP)agenciesandtothegeneralpublic.EnergysecuritySeveralgovernmentcommitteesweresetupinsuccessionduringthosefirstyears.TheirmandatewastoWithinoneshortdecadeIsraelhasmadeagiantleapsetuptheoverallregulationofthesectorandinaddition,from2.5bcmofnaturalgasdemandin2012to13theydealtwitharangeofissuessuchasfiscalpolicy,outliningtheissueofgasexportsandcompetition,etc.TheguidingprinciplesaccordingtowhichtheregulatorydecisionsweremadewerebasedonthelinksOCTOBER2023GLOBALVOICEOFGAS41TheeconomysavedNIS190bnasaresultofA32%reductioningreenhousegasemissionsintensitydramaticreductioninpollutantemissionsfromtheproductionofelectricityintensityThankstothetransitiontonaturalgas,IsraelisoneofAreductionof85%intheintensityofNOxemissionstheleadingOECDcountriesinreducingtheemissionsand76%intheintensityofnitrogenoxideemissions.ofgreenhousegasespercapita.0.0160.8NOxEmissions/KWh0.01476%emissionintensity32%emissionintensityCO2Emissions/KWh0.75reductionofNIS23.90.012reductionofNIS94.90.70billioninpollutioncostsbillioninpollutioncosts0.0100.0080.600.0060.004Contribution0.55Contribution0.002ofrenewables0.5ofrenewables00.452012201320142015201620172018201920202021202220122013201420152016201720182019202020212022NotincludingsavingsfromindustryemissionsintensitySource:BDOanalysisofelectricityeconomyreportsbytheElectricityAuthoritySource:BDOanalysisofelectricityeconomyreportsbytheElectricityAuthorityandtheMinistryofEnvironmentalProtection“GreenBook”.andtheMinistryofEnvironmentalProtection“GreenBook”.BasedonOurWorldinData.org,Israelisranked2ndintheOECDforreductionofCO2emissionspercapitaoverthepastdecade.andinterrelationshipsbetweenthekeyaspectsofthe$10.8permmBtu–inEurope.Thankstothiselectricityenergymarket:energysecurity,economicfeasibility,pricesinIsraelhavedeclinedbyapproximately11%local-versus-exportmarkets,greenhousegasemissionsthispastdecadewhileinEuropeelectricitypriceshavereduction,pollutionreduction,taxation,etc.Oneoftheincreasedbysome40%onaverage.Inthesecondhalfofdecisionswasthat,inordertoendtheuseofcoal,three2022,consumerenergypricesinIsrael($0.17perkWh)separate,independentproductionsystemsneedtobewereroughlyhalftheaverageEUprice.Thankstothis,built.Israelhasemergedvirtuallyunscathedfromtheglobalenergycrisis,whichhasgivenitacompetitiveedgethanksDespitetheanticipatedsubstantialgrowthindemandtolowenergycosts.inthedomesticmarket,Israel’senergymarketwastoosmalltocreatethelevelsofdemandnecessaryNaturalgasandtheenvironmentfordevelopingtwoadditionaldeep-watergasfields.ExpandingthetargetmarketsandinstallingthepolicyTherapidtransitiontonaturalgas-poweredelectricityforthisbecamenecessarytoabsorbtheplentifulgeneration,replacingpollutingcoal,hasdrasticallynewly-discoveredsupply.Inotherwords,substantialreducedemissionsinIsrael.TheintensityofNOxexpansionofthetargetmarketsthroughexportsofemissionshasdroppedby76%overthepasttenyears,Israeligas.ThisholisticsolutionledIsraelintoaprocessandtheintensityofSO2emissionshasdeclinedby85%.ofunprecedentedinfrastructuredevelopment,whichWithinthesametimeframe,totalelectricitygenerationproducedenergysecuritywhichwashithertosomethinghasincreasedbyover20%.Additionally,CO2emissionthecountrycouldonlydreamof.intensityhasalsodroppedconsiderably–32%sincethestartofthenaturalgasrevolutioninIsrael.AmongOECDLoweringpowerpricescountries,Israelissecondinitsreductionofpercapitagreenhousegasemissionsthispastdecade.Therapid,efficientdevelopmentofthenaturalgasmarketinIsraelthroughmassiveinfrastructuredevelopmentTheeconomicvalueofthisreductioninairbroughtaveragegaspricestoalevelof$5.3permmBtupollutionintensityandgreenhousegasemissionstotalsthispastdecade,asopposedtodoublethatamount–approximately$90bn.Therehasneverbeenaproject42GLOBALVOICEOFGASOCTOBER2023Thetransitiontoenergyindependence:localPotentialundiscoveredgasof2,100bcm–doublethenaturalgaspushedoutimportedpollutingfuelsamountalreadydiscoveredAsaresultofthenaturalgasrevolution–transition2500fromdependenceonimportedenergyto80%localenergy.200020030%Localenergy202278%LocalenergyBCM100%150090%80%100070%60%50050%40%0Endof202230%Reserves20%Undiscovered10%Potential0%20032004200520062007200820092010201120122013201420152016201720182019202020212022TamarThetisSeaLeviathanKarish,Tanin&OlympusLocalNaturalGasImportedFuels:Coal,Oil,LNGRenewablesSource:BDOanalysisofElectricityAuthorityandNogaDataUndiscoveredpotential-basedonMinistryofEnergy2018(Dr.MichaelGardush,LevantOntheelectrictymarket.BasinHydrocarbonpotentialandfuturedevelopment);Endof2022reservesBDO.Analysis:basedonestimatesbyindependentassessorsonbehalfofthegascompanies,aspublishesintheirfinancialstatements.Thedataincludescategories2C,2PandtheEnergeandiscoveries-KarishNorthanddiscoveriesintheOlympusregionincludednon-audited29BCM.inIsraelthathasyieldedsuchadramaticenvironmentalIsraelisnowmarkingadividendasthenaturalgasproject.decadesinceitsnaturalgasrevolution,whichbeganwithIsrael’snaturalgasfieldsaredeepinIsraeliwaters,thesizableproductionandtensofkilometresfromthecoast.Despitetheseuseofnaturalgasin2013.beingcomplicated,expensiveprojects,themethaneemissionsfromthemareamongtheworld’slowest.Thisnaturalgashasbecomeamulticulturalenvironmentalaccomplishmentisduetothefactthatthesearemodernandeconomicbridgeheadbenefittingalloftheregion’sprojects,builtunderpresent-dayregulationswithstrictinhabitants.adherenceonthepartoftheowners.Israel’snaturalgasindustrytodaydelivers40%ofthecountry’senergyThelargescaleofthegasreservesdiscoveredinneeds.Productionisequivalenttothree-quartersofitsIsraelsofar,relativetoitsdomesticmarket,alongsideneeds,whileatthesametimemethaneemissionsfromgeologicalpotentialfordiscoveringanadditional2,000thisentireeffortare,accordingtoconservativeestimates,bcminsideIsrael’seconomicwatersand,moreover,amere0.3%ofIsrael’stotalmethaneemissions.throughouttheentireEasternMediterraneanbasin,provideIsraelandtheothercountriesintheregiontheAmulticulturalenvironmentaleconomicmeansofbecomingsignificantplayersinsolvingthebridgeheadworld’senergyshortages.Throughnaturalgasexports,ourregioncontributes,andwillcontinuetocontribute,ThesizablegasdiscoveriesinIsrael’seconomicwaterstowardbolsteringglobalenergysecurityandreductionofhavegeneratedmomentuminthesearchfornaturalglobaluseofpollutingcoal.gasacrosstheregionand,besidestherapidlocaldevelopment,regionalexportinfrastructurehasalsobeenbuilt.Thebenefitsthattheseindustriesenableareofunprecedentedeconomicandenvironmentalbenefits–notonlyforIsrael,butalsoforothercountriesintheregion,whichenjoyclean,stableenergysupplies.Thus,OCTOBER2023GLOBALVOICEOFGAS43AglobalgasmarketthatperformsTheIGU’sWholesaleGasPriceSurvey2023trackstheriseofgas-on-gaspricingandLNGspottradingovertheyears,thedeclineofoilpriceescalationandtherecentwideningofglobalgaspricevariation.JOSEPHMURPHYTheInternationalGasUnion(IGU)releaseditsfifteenthTheriseofGOG,thedemiseofOPEannualWholesaleGasPriceSurveyinSeptember,trackingtheevolutionofglobalwholesalepriceformationThesurveyshowedhowwholesalegaspriceformationsmechanisms.Thesurvey’sfindingsaresupportedbyhavetransformedsignificantlybetween2005and2022.responsesfrom85outofthe113gasmarkets,coveringTheshareofgas-on-gas(GOG)competitionpricing–91%oftotalglobalgasconsumption.wherethepriceisdeterminedbytheinterplayofdirectgassupplyanddemand–almostdoubledovertheperiodAsIGUPresidentLiYalanremarkedinaforeword,from31.5%to50%.Thislargelycameattheexpenseofthesurvey“continuestoshowthecriticalityofawell-theshareofoilpriceescalation(OPE)–wherethepriceisfunctioningglobalgasmarketatwork,asthegasmarketslinkedtocompetingfuels,typicallycrudeoil,gasoiland/havebeenexperiencingthemostturbulentperiodinorfueloil–fellfrom24%to17.5%.theirhistoryamidstasevereglobalenergycrisisandanongoingwarbetweenRussiaandUkraine.”TheriseinGOGanddeclineinOPEbetween2005and2017wasmostlytheresultofchangesinpipelineThiswell-functioningmarkethelpedEuropekeepitsimportsbyEurope,withOPEalmostvanishinginlightsonbyattractingunprecedentedadditionalLNGnorthwestEuropeandcentralEuropeonthebackofvolumestoreplacelostRussianpipelinevolumes,sheEuropeanenergymarketreformandliberalisation.OPEsaid,effectivelyredrawingtheglobalgastrademappersistsinEuropeinTurkey,thecontinent’ssoutheastwithoutinterruptingsupply.andtheBalticcountries,however–marketsthatwere44GLOBALVOICEOFGASOCTOBER2023Figure1:WholesalepriceformationmechanismsmapSource:IGUinthatperiodheavilyreliantonRussia.ItalsoremainsincreaseinspotLNGimportsinSouthKoreaandChinesepresentinSpainandPortugal,whichchieflyimportTaipei,andrisingdemandinRussiaalsospurredagrowthAlgerianpipelinegasandLNG.inGOG’sshare.Therewasashiftupuntil2016fromregulatedpricingThesevariousfactorsmorethanoffsetadropinGOGmechanismstomarket-basedpricingsuchasGOGanduseinAsiaoverall,asaresultofChinaandPakistanOPE,butthattrendhassincepaused.ThedrivingforcescalingbackspotLNGimports.WhileglobalgasimportsbehindGOG’sriseandOPE’sdemisesince2016wasthefellinvolume,onthebackofasteepdropinRussianformer’sincreaseduseintheLNGspace,inparticularviapipelineexportstoEurope,therelativesharesofOPEandspotmarkettrading.Withintheregulatedpricingarea,GOGwerenotalteredmuch,asthefallinRussianGOG-thebiggestchangeswereseenbetween2005and2012,pricedsupplieswasoffsetbyOPE-to-GOGswitchinginassubsidedpricingorregulatedbelowcost(RBC)pricingothermarketsandincreasedspotLNGflowtoEurope.gavegroundtohigher,butstillregulatedprices.Asnoted,GOGnowheavilydominatestheEuropeanOver2022,theshareofGOGgrewbyafurther1.5gasmarket(seefigure1),accountingfor82%oftotalpercentagepoints,primarilyattheexpenseofOPE.volumes,includingalmostalldomesticconsumption,GOG’sshareofgasimportvolumestouchedanewhigh82%ofpipelineimportsand76%ofLNGimports.Thisisof56%.Thegrowthwasparticularlypronouncedinamarkedcontrastfromin2005,whenonlytheUKhadEurope,duetoasharpincreaseinspotLNGimports,assignificantGOGuseonthecontinent.GOGnowexceedswellasaswitchinsomeofTurkey’ssupplycontractsforOPEeveninSpain.TurkeyisstillprimarilyOPE,butitgasfromRussiafromoilindexationtohubpricing.ThenowonlyjustexceedsGOGinshareasaresultofpricingpricingofgassuppliesfromAlgeriaintoTunisiawasalsoadjustmentsinRussiancontracts.adjustedtoGOGfromOPE.InAsia,therewasalsoanIncomparison,OPEisstillthemainmechanisminOCTOBER2023GLOBALVOICEOFGAS45“[Thesurvey]Figure2:continuestoshowWorldpriceformation2005-2022-LNGimportsthecriticalityofawell-functioning100%40%globalgasmarketatwork.”80%30%IGUPRESIDENTLIYALAN60%20%40%10%20%$/MMBTU%SpotLNG0%0%200520072009201120122013201420152016201720182019202020212022OPEGOGTradedGOGSpot%SpotLNGmostAsiancountries,whileintheFormerSovietUnion,Figure3:theMiddleEastandNorthAfrica,pricesremainlargelyWholesalepricelevels2005-2022byregionregulated.MoreGOGandspottradinginLNG3530ZeroinginontheLNGmarket,GOGpricingofLNG25importstookoffin2017,doublingitssharebetween201620and2022to47%(seefigure2).Thistrendwasdrivenby15risingspotLNGimports,andlaterarushofLNGflowto10Europe’stradedmarkets.MoreHenryHub-pricedgasenteringthosemarketsin2021alsoplayedarole.50TheshareofspottradingintheLNGmarketgrewsubstantiallyin2005-2022,fromunder5%atthestartto20052007200920112012201320142015201620172018201920202021202235%attheendoftheperiod.Growthpriorto2010wasmainlyintheAsia-Pacificregion,anditbegancatchingNorthAmericaEuropeAsiaoninAsiaafterthatyear.SpotLNGvolumesinEuropeAsiaPaciﬁcLatinAmericaFSUremainedrelativelylowuntil2018,buttookoffafterAfricaMiddleEastWorldthat,withasharpjumpseenin2022asLNGreplacedlostRussianpipelinevolumes.Since2016,thedriverofrisingthroughto2015duetoashiftawayfromsubsidisedincreasedspotvolumeswasthesurgeinLNGexportspricing,afterwhichpointtheylevelledoff.fromtheUS.FromthatyeartherehavealsobeengrowingspotLNGvolumesgoingintothemarketsofIndia,China,Asian,AsianPacificandEuropepriceshavegenerallyJapanandSouthKorea.trackedeachothersince2015butthelinkwasseveredin2019,afterasignificantdropinspotpricesthatmainlyInthefiveyearperiodending2022alone,spotLNGbenefittedtheEuropeanmarket.Thedifferencebetweenvolumesnearlytripledto171bcm.EuropeanandAsian/AsianPacificpriceswidenedin2020afterthepandemictriggeredacollapseinspotprices.Risingprices,greatervariationButin2021,thepost-coronaviruseconomicrecoveryledEuropeanpricestoovertakeAsian/AsianPacificpricesGlobalwholesalegaspricesweregenerallyrisingbetween(seefigure3),giventhatthelatterregionsusemoreOPE2005and2014,althoughtheNorthAmericanmarketwaspricing,whichwasmorestable.Thedifferencebecameanexception,wheretheshalegasrevolutionsawsupplyevengreaterin2022.soar.Globalpriceshitrecordsin2022,asaresultofRussiansupplycutsandthebroaderenergycrisis.Thevariationinglobalgaspricelevelswidenedsignificantlyin2021andevenmorein2020,incontrasttoRegionsdominatedbyregulatedprices–Africa,thethetrendofpriceconvergenceseenbetween2005MiddleEastandtheFormerSovietUnion–sawpricesand2015.46GLOBALVOICEOFGASOCTOBER2023ADVERTISEINGlobalVoiceofGasTheOfficialMagazineoftheInternationalGasUnion.Getyourcorporateandmarketingmessageouttotheworld.Ifyoumissedoutonthisissue,youstillhavetwomoreissuesleftfor2023!Foronlyasmallcostforafull-pagead,GlobalVoiceofGasGlobalVoiceofGasyoucangettherestoftheyearcovered.BYTHEINTERNATIONALGASUNIONBYTHEINTERNATIONALGASUNIONThemagazineisdigitallydeliveredtoover45,000stakeholdersISSUE4VOL02ISSUE1VOL03inthenaturalgasindustry.Amongthemare:ASPOTLIGHT·Decisionmakers(74%areseniormanagement)acrossUpstream,ONASIAMidstream,DownstreamandLNGsupplychains.TAKINGSTOCK·MembershipofIGU,includingtheIGU’sCharterandAssociateOF2022:Members,theCouncil,ExecutiveCommitteeandTechnicalCommitteesandTaskforces.WHEREDOESTHEMOSTTURBULENTYEAR·OrganisationsaffiliatedtotheIGU,IGUStrategicPartners,INGLOBALGASIGUWisePersons.MARKETSLEAD?·Seniorrepresentativesofgovernmentalandnon-governmental2022:themostturbulentyearEUgaspricecap:eitherSupplycrunchpromptsHighpricesposechallengetoWillAsianLNGdemandThejourneyofastartupthatishavingabodiesandmulti-lateralinstitutions.inhistoryforgasmarketssymbolicordangerousfallingasdemandIndiangasambitionsbounceback?realimpactinreducingﬂaringandrelatedmethaneemissions·Energyministriesandregulatoryauthoritiesforgasandpower.·GlobalUtilities,TransmissionandInfrastructurecompanies.·Leadingconsultantsandadvisorsinthefinancial,legal,environment,technologyandrenewablegassectors,aswellasglobalacademicsandthoughtleaders.GREGKLAUSMEYEREmail:gklausmeyer@naturalgasworld.comTel:+1281-224-6430AdvertisingSalesDirectorGlobalVoiceofGasAPublicationoftheInternationalGasUnionGlobalVoice(IGU)incollaborationwithMinoilsMediaLtd.ofGasIGUEditorialTeamBYTHEINTERNATIONALStrategicCommunicationsandGASUNIONMembershipDirectorTatianaKhanbergISSUE03VOL03IGULeadershipInternationalGasUnionSecretaryGeneral44SouthamptonBuildings,MiltonCatelinWC2A1APLondon,UnitedKingdomE-mail:info@igu.orgPresidentWebsite:www.igu.orgLiYalanMinoilsMediaLtd.VicePresidentc/o595BurrardSt,Suite#700,AndreaStegherVancouver,B.C.V7X1S8CanadaMinoilsMediaTelephone:+1604.644.6624AdvertisingandSponsorshipInquiresE-mail:engagement@naturalgasworld.comGregKlausmeyerWebsite:www.naturalgasworld.cominquiries@naturalgasworld.comCopyright©2023.Editor,GlobalVoiceofGasandTheentirecontentofthispublicationisprotectedbycopyright,Editor-in-chief,NaturalGasWorldfulldetailsofwhichareavailablefromthepublisher.AllrightsJosephMurphyreserved.Nopartofthispublicationmaybereproduced,storedinretrievalsystemsortransmittedinanyformorbyanyPublishermeans–electronic,mechanical,photocopying,recordingorMinoilsMediaLtd.otherwise–withoutthepriorpermissionofthecopyrightownerSeniorEditorsDaleLunanRossMcCrackenVicePresident,Strategy&EngagementJoaoSalvianoPresidentH.RickGill

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