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GLNG COMMENTARY GLNG

Total sees oil demand

peaking in 2030

Faced with gloomier prospects for oil, Total is doubling

down on gas and renewables

ENERGY FRENCH oil major Total has joined other oil vehicles (EVs), solar, wind and biofuel.
TRANSITION companies predicting that peak oil demand will “Momentum goes beyond the business-as-
arrive in the coming decade, forecasting an end usual scenario; nevertheless, it fails the well-be-
WHAT: to consumption growth in 2030. low 2oC target globally,” Kristoffersen said.
Total has forecast in its This represents a more bullish forecast than Rupture, on the other hand, sees all countries
Energy Outlook that oil that of UK peer BP, which recently warned that pledging net-zero targets while also envisaging
demand will peak in oil consumption would peak in the early 2020s, breakthroughs in as-yet-unproved technologies
2030, or possibly sooner, if it has not done so already. However, it still such as hydrogen, synthetic fuels and carbon
depending on the pace of marks a major turnaround in Total’s thinking. capture. This will enable them to be developed at
decarbonisation efforts. Just a few years ago Pouyanne described peak oil scale to cut emissions. As such, global tempera-
demand as merely a possibility. Consumption ture growth will be limited at 1.5-1.7oC.
WHY: could reach its height sooner than 2030, Total While primary energy consumption will
Oil will begin to cede now says, depending on the pace of decarbon- climb by 0.6% annually in Momentum, it rises
market share in transport isation efforts. by only 0.4% per year in Rupture.
to cleaner fuels, and Faced with gloomier prospects for oil, Total is Solar and wind power will see a rapid expan-
the petrochemicals not only looking to expand in renewable energy sion in usage in both scenarios, being deployed at
sector will undergo a but also gas, which it sees as having a much a rate of more than 200 GW per year in Momen-
transformation, Total stronger outlook. Gas will have an important tum and over 500 GW per year in Rupture. The
says. role in decarbonisation by displacing dirtier share of EVs in transport will also soar to 60%
fuels, Total argues, especially as greener gases in Momentum and 75% in Rupture, compared
WHAT NEXT: are adopted. with the current 1%. Carbon capture and storage
Total believes the outlook “Oil demand will reach a plateau around 2030 (CCS) capacity will also be scaled up to 2,000-
for gas is much stronger. and then decline slowly thereafter due to trans- 7,500 gigatonnes per year.
It plans to double its port and petrochem accelerated transforma- Gas will primarily seize market share away
LNG sales within the next tion,” Total’s president for strategy-innovation, from coal and oil. In Momentum, its consump-
decade and focus on Helle Kristoffersen, said. “Gas will continue to tion will increase by 1.3% annually and reach 5.7
making gas greener. play a key role for decades. It has a key role to play trillion cubic metres by 2050. Its biggest gains This represents
in power systems, heat and in transport.” will be in Asia, where it will substitute a lot of
coal-fired generation. Gas will remain vital in a more bullish
Energy outlook power generation, in industry and in residential forecast than that
Kristoffersen was discussing Total’s Energy and commercial sectors, Kristoffersen said. It
Outlook report published on September 29. The will also expand in transport, becoming a more of UK peer BP,
company forecast continued growth in global widespread fuel for vehicles and ships.
energy demand over the next three decades in all Even in Rupture, gas will remain an impor- which recently
scenarios considered, by 10-25% in total during tant means of ensuring power grid stability and
the period. But this extra demand will be met by flexibility at an affordable cost, Total said. Under warned that oil
low-carbon power. that scenario, demand for natural gas will peak consumption
Electricity’s share of final energy consump- in 2040, but consumption will continue climbing
tion will rise from 20% currently to 30-40% by beyond 2050 if hydrogen and other green gases would peak in the
2050. are included in the mix.
Total bases its predictions on two main sce- “To fully play its role in the energy transi- early 2020s.
narios which it calls Momentum and Rupture. tion, gas has to become much greener and much
Both envisage Europe becoming carbon neutral cleaner,” Kristoffersen explained. “That will
by 2050 – the goal set in the European Green come at a cost, at least in the early years.”
Deal. Momentum sees countries in the rest of In Momentum, the share of green gas will be
the world pursuing their existing national cli- limited by its higher cost and a lack of sufficient
mate targets, as well as an aggressive deployment carbon regulation. Even so, it should rise to 8%
of proven clean technologies such as electric of total gas supply by 2050, versus 0.1% in 2018.

Week 40 09•October•2020 www. NEWSBASE .com P13