LNG infrastructure suited to the demands of the transition is a must but faces issues

LNG and natural gas have been identified as fuels to fulfil energy demand growth while helping the world decarbonise. But progress could rest on the challenge of developing necessary infrastructure to support this pathway.That scenario drove a Strategic Dialogue session titled ‘Mapping and delivering the natural gas and LNG infrastructure required to meet demand growth scenarios’. 

Brian Essner, VP - LNG Origination & Commercial, Chevron, stated natural gas will continue to play an important role in meeting the world’s energy demand in the short, medium and long term.

But he told the Energy Collaboration Theatre: “Policy and technology developments have lagged global ambitions for a rapid energy transition. 

“And each jurisdiction is different. No one solution fits everybody, and it takes local partnerships to tailor solutions and infrastructure to meet those local markets.  

“So we find partners in local jurisdictions to help us meet the energy demands of that market. And if you think about policy as an enabler, really it is the tool to make long-term decisions that allow new industries to be born and scaled.” 

Carlos de la Vega, VP - Marketing & Commercial Development, Sempra Infrastructure, touched on risk with regards LNG projects in certain geographies. “From the physical standpoint, we know that to build LNG infrastructure can be done relatively quickly,” he said.   

“This is really about regulatory hurdles and credit, who is basically going to guarantee LNG that’s coming from whatever part of the world. Who’s going to take that risk? If it’s not sovereign governments, it’s got to be Western governments, Western entities.” 

Thomas Hardy, Acting Director, US Trade & Development Agency, described “energy access as the road to prosperity” as he outlined his organisation’s role as a “first mover” in finding new customers for US LNG exports. 

“There’s still huge parts of the world that don’t even have access,” he said. 

Hardy explained, “That’s the other side of the equation the agency plays, helping to provide that early catalyst grant capital to advance critical infrastructure projects in emerging markets.” 

Carsten Poppinga, CCO, Uniper, said that political regulatory framework had to be right and guarantee stability for infrastructure to progress in Europe as well. He also emphasised the role of storage in the infrastructure puzzle to underpin energy security. 

“Europe will need natural gas for decades,” he said. “Storage will be important as a flexibility source, not only for gas to power, but also the gas market. So we need proper regulation in place and that storage infrastructure gets built,” he said. 

Tiffany Pitts, VP - Gas Technology Services, Industrial & Energy Technology, Baker Hughes, said her company was answering the challenge of developing infrastructure to support gas growth while meeting decarbonisation goals by providing technology designed for optimisation. 

“We still have a lot of work to do in terms of regulatory policies that need to be in place to support these projects as they develop across the world, including the right financing. 

“But let’s assume those things happen. We’ve made the case for natural gas as a contributor to energy security…how do we make those the most efficient, most optimised projects in the world? That’s where Baker use comes into play.” 

Pitts made the point that not all operators were in a position to replace an installation, however, but tech was enabling change. 

“You look at greenfield, you look at brownfield, because you need all to come together to optimise your portfolio,” she said. “Technology that’s already installed also has the opportunity to be improved for efficiency and for lowering emissions, things like upgrades.” 

Bhupesh Thakkar, SVP & GM - LNG & Regas Bechtel emphasised customer focus and the importance of the workforce in the LNG/gas ecosystem. 

“The main driver for us is that our customer’s committing millions of dollars, and they’re counting on the revenue when the project starts,” he said.  “And the most important thing is our people…the teams make a huge difference.”