Page 6 - NorthAmOil Week 24 2021

NorthAmOil COMMENTARY NorthAmOil

Clean LNG initiatives accelerate

New initiatives related to clean LNG and decarbonisation appear to be accelerating,

with more developments announced in recent days

GLOBAL EFFORTS to decarbonise LNG continue apace, company Temasek Holdings, put out a call last
and appear to be picking up momentum with year for sellers of LNG to quantify their GHG
WHAT: a handful of new developments announced in emissions and to partner with it on developing
More initiatives related recent days. an industry standard for reporting and moni-
to the decarbonisation Some of the initiatives mark a continuation toring such emissions. The three subsequent
of LNG have been of previously announced plans, while others are supply deals illustrate that at least some LNG
announced in recent altogether new developments. And both types players are responding to the call.
days. illustrate that decarbonisation is increasingly Ultimately, Pavilion also wants producers of
becoming a priority for the LNG industry as it LNG to offset their emissions. The company
WHY: seeks to demonstrate that it can have a role to imported Singapore’s first carbon-neutral LNG
LNG industry players play in the energy transition. cargo in April.
are increasingly trying
to demonstrate that they Third supply deal Cheniere’s progress
can have a role to play in Among the most recent developments is a new Pavilion is not the only company to be making
the energy transition. supply deal between Singapore’s Pavilion Energy progress with its plans to quantify – and ulti-
and BP with a greenhouse gas (GHG) emissions mately reduce – GHG emissions from LNG. The
WHAT NEXT: quantification component. US’ Cheniere Energy announced this week that
Yet more moves to clean Pavilion Energy Trading & Supply announced it had agreed to collaborate with five gas produc-
up LNG are expected that it had signed the long-term sale and pur- ers and several “leading” academic institutions
to follow, but the costs chase agreement (SPA) with BP Singapore for on implementing quantification, monitoring,
involved will be a the supply of roughly 800,000 tonnes per year reporting and verification (QMRV) of GHG
concern. (tpy) of LNG to Singapore for 10 years from emissions performance at gas production sites.
2024. The two companies said they would “strive This comes as Cheniere – the US’ largest
to co-develop and implement a greenhouse gas producer of LNG – works towards providing
(GHG) quantification and reporting method- its customers with GHG emissions data asso-
ology”. The methodology will cover emissions ciated with each of its cargoes, from wellhead
from the wellhead to the discharge terminal, to cargo delivery point, from 2022. This initia-
they added. tive comes with a particular set of challenges, as
This is the third long-term deal to be signed Cheniere sources its feed gas from a wide variety
by Pavilion since November, as Singapore seeks of regions and producers.
to diversify its gas imports ahead of the expiry of In this, the US’ LNG industry differs from that
pipeline gas contracts with neighbouring Indo- of certain other countries, where a single com-
nesia from 2023. The other two deals – with pany or consortium may develop a field solely
Qatar Petroleum (QP) and Chevron – both to support an LNG project that it also operates.
require each delivered cargo to be accompanied Now Cheniere is taking steps to overcome the
by a statement of its GHG emissions. challenge involved in quantifying emissions
The deals were struck after Pavilion, which from the multiple parties involved in its supply
is owned by Singapore state-owned investment chain.

P6 www. NEWSBASE .com Week 24 17•June•2021