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While its share of the cuts is far smaller than Offshore Oil Corp. (CNOOC). This will be the
the likes of Russia and Saudi Arabia, OPEC+’s first carbon-neutral LNG to reach the Chinese
lead members will want to ensure that all parties mainland.
keep to their promises. The stakes are high, as the Shell said all emissions from exploring for
deal’s collapse would derail the market recovery and producing the natural gas used as feedstock
and cause oil to spiral downwards once again. for the LNG, as well as the use of the fuel by the
Downstream, Russian refineries cut their final consumers, are offset by credits from a
gasoline output to a 15-year low in May in variety of nature-based projects. These include
response to a slump in fuel demand triggered afforestation projects in China’s Qinghai and
by coronavirus-related travel restrictions, the Xinjiang provinces that the company supports.
country’s energy ministry estimates. The speed Shell has been supplying a small number of
at which fuel demand collapsed in Russia has carbon-neutral LNG cargoes to buyers since Shell has agreed
been matched by how quickly it has recovered, June 2019. The first buyers of these cargoes were
catching suppliers unaware. At the start of June, Tokyo Gas and South Korea’s GS Energy. Shell to deliver two
Russia’s energy ministry called on producers to supplied a third carbon-neutral cargo to Taiwan’s
cut gasoline exports and send more fuel to the CPC in March. cargoes of
domestic market. The cargoes being delivered to CNOOC will carbon-neutral
In Georgia, there is progress at the West be auctioned through the Shanghai Petroleum
Rustavi gas field, with London-listed operator and Gas Exchange (SHPGX), which Shell said LNG to CNOOC
Block Energy reporting the arrival of an early would offer many downstream gas buyers the
production facility. This brings the company one opportunity to decarbonise their energy use.
step closer to launching gas sales from the field No date has been disclosed for the auction,
in the second half. and the size of the cargoes has not been spec-
Despite slashing spending by 40% in April, ified either. However, Shell said the cargoes
Block says it remains “enthusiastically active on would provide enough energy to power nearly
many fronts.” It has formed a partnership with 300,000 homes for an entire year. Separately,
international consultancy EPI to help draw up the super-major has said that an average LNG
development plans for both its existing pro- cargo of around 70,000 tonnes results in roughly
jects and others it is looking to acquire from 240,000 tonnes of carbon dioxide (CO2) emis-
Schlumberger. sions across the value chain.
It has not yet been disclosed what additional
If you’d like to read more about the key events shaping costs may be involved in producing and selling
the former Soviet Union’s oil and gas sector then carbon-neutral LNG. However, it comes as the
please click here for NewsBase’s FSU OGM Monitor. industry is ramping up efforts to illustrate the
role natural gas can play in the energy transition.
Carbon-neutral LNG
Royal Dutch Shell announced this week that it If you’d like to read more about the key events shaping
had agreed to deliver two cargoes of carbon-neu- the global LNG sector then please click here for
tral LNG to a subsidiary of China National NewsBase’s GLNG Monitor.

Week 25 25•June•2020 www. NEWSBASE .com P9