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GLNG COMMENTARY GLNG

Shell to sell two more cargoes

of carbon-neutral LNG

Royal Dutch Shell has agreed to supply two more cargoes of carbon-neutral

LNG, as it continues to grow this nascent industry

ENERGY ROYAL Dutch Shell announced this week that Chinese gas customers looking to decarbonise
TRANSITION it had agreed to deliver two cargoes of “car- their energy use.”
bon-neutral” LNG to a subsidiary of China Shell said in its statement that nature-based
WHAT: National Offshore Oil Corp. (CNOOC). The projects protect, transform or restore land, help-
Shell is supplying delivery, to CNOOC Gas & Power Group, will ing to boost oxygen while carbon dioxide (CO2)
carbon-neutral LNG to mark the first carbon-neutral LNG to reach emissions from the atmosphere are absorbed. In
a subsidiary of China’s the Chinese mainland. Shell has supplied three addition to protecting biodiversity and restoring
CNOOC. carbon-neutral cargoes to date, starting in June ecosystems, the super-major hopes the credits
2019 – to Tokyo Gas, South Korea’s GS Energy from projects in Qinghai and Xinjiang may also
WHY: and Taiwan’s CPC. increase the added value of forestry in China
A small number of and provide a new source of income to local
buyers are increasingly Carbon neutrality communities.
interested in ways to Shell said in a statement that for LNG to be car- Shell has said previously that its global
offset their carbon bon neutral, all emissions from exploring for and portfolio of nature-based projects includes the
footprint. producing the natural gas used as feedstock, as Katingan Peatland Restoration and Conserva-
well as the use of the fuel by the final consum- tion project in Indonesia, the Cordillera Azul
WHAT NEXT: ers, are offset by credits from a variety of nature- National Park project in Peru and the Form
Questions of affordability based projects. Under the latest agreement with Reforestation project in Ghana. The super-ma-
need to be addressed CNOOC, the nature-based projects include jor notes that there is no single solution as far as
as carbon-neutral afforestation schemes in China’s Qinghai and decarbonisation goes, which is why it is investing
LNG becomes more Xinjiang provinces that the company supports. in nature-based projects as it strives to become
widespread. “We are very excited and humbled to be a “net-zero” emissions company by 2050 or
working alongside our trusted partner CNOOC sooner. Nature-based projects are one compo-
in bringing the first carbon-neutral LNG car- nent, with Shell also pursuing targets such as
goes to [the] Chinese mainland,” Shell Energy’s an improvement in the energy efficiency of its
executive vice-president, Steve Hill, stated. “We operations, selling more natural gas, generating
are particularly pleased to be able to also use electricity from renewables and providing low-
credits from projects in China for China. Using er-carbon fuels such as biofuels and hydrogen.
nature-based credits in conjunction with LNG In another innovation, the cargoes being
is a unique solution to support the needs of delivered to CNOOC will be auctioned through

This will be the first
carbon-neutral LNG to
be supplied to mainland
China.

Week 25 26•June•2020 www. NEWSBASE .com P11