Partnerships can help redefine energy landscape but with progress over time

Companies and nations have to tackle a tough equation in which they must achieve net-zero aspirations while meeting rising global energy demand.

A high-profile panel of energy industry players from across several geographies spoke with pragmatic optimism on this issue on the first morning of Gastech 2024.

The growth and effectiveness of LNG figured large in Strategic Leadership session Redefining the energy landscape: Reimagining strategies and business models to balance growing energy demand with impactful progress on global climate goals.

Meg O’Neill, CEO and MD of Woodside Energy, said she was a very strong believer in the role of LNG in the energy transition conversation.

“We’ve got a deep belief as well that the world has the capacity to absorb more LNG…you only have to look to some of the nations around the world,” she told the Plenary audience.

“There have been forecasts of LNG gluts at a few points in the past, and none of them have come to pass, because the reality is the market is hungry for this source of fuel.”

She highlighted how when gas is used in lieu of coal for power generation, it produces about half the lifecycle emissions intensity.

“The total global LNG market today is equivalent to about 12% of coal use, so there’s a lot of room for us to grow the LNG market, to provide reliable, affordable energy and to tackle climate change.”

In a wide-ranging discussion, Musabbeh Al Kaabi, ADNOC’s Executive Director - Low Carbon Solutions & International Growth, was among the executives highlighting how business models are evolving to new strategies and technology required by a low carbon world.

“Traditional energy providers need to decarbonize the current energy system, while also investing in the new energy system of tomorrow,” he said.

“Post Cop28 it was clear that the task is going to be a challenge, but possible.”

While market forces play a role, of course, policy also weighs strongly in accelerating decarbonization, but could also slow things, as the pause on new LNG export licenses in the US illustrated.

Jack Fusco, Director, President & CEO, Cheniere Energy, said he hoped “cooler heads prevail.”

“I’m hopeful that at the end of the day we get to the right conclusions, and we can move forward and can meet the needs of a cleaner energy transition for the world and for energy security, for our allies.”

This led the panel to discuss the potential policy shift a change of administration could bring when the US goes to the polls this November.

Yukio Kani, Global CEO & Chair of JERA, spoke of his three decades of experience in the LNG industry during which time “this type of thing is popping up every time…that’s kind of a normal life for me, but there’s so many challenges ahead for LNG industry.”

Meanwhile, O’Neill said her company made its decisions with a very long-term orientation. “Any individual president or prime minister will be gone before our projects are finished,” she said.

Al Kaabi also weighed up the wider picture. “When we look at different jurisdictions, we look at the fundamentals of the business,” he said. “So as long as the fundamentals are strong, we pursue these opportunities.”

O’Neill summed up the mood when she said that things can work “really effectively” when government and private investment together are working with the same vision of where they want to get to “and with a clear understanding that the goal is progress over time, not perfection tomorrow.”

She added: “We need the policy settings. We need the regulatory framework. We need the investment appetite. But again, you have to have all three of those things working together to be able to unleash progress in this lower carbon space.”