THE RESILIENCE OF GAS IN AN INNOVATIVE ENERGY LANDSCAPE
George Gilboy, Chief Representative Japan, Woodside Energy
Headlines the world over cite the increasing penetration of renewable energy to proclaim a successful crossover into the mainstream, and the imminent decline of fossil fuels in the energy mix.
The increased uptake of renewable energy is welcome, as the world seeks to limit temperature rises in line with the recommendations from the UN’s Intergovernmental Panel on Climate Change.
However, far from fossil fuel producers becoming fossils, the coming decade of transition to lower-carbon energy sources offers a once-in-a-generation opportunity – particularly for gas producers.
The ‘new energy landscape’ still contains a great deal of ‘old’ energies. Demand for coal is still projected to increase to 2025, particularly in the Asia-Pacific region. Renewables continue to present challenges, in the form of reliability, lifecycle costs and unintended external impacts.
Gas has certain inbuilt advantages over both coal (including ‘clean’ coal) and renewables. In this innovative energy landscape, LNG remains resilient. Gas supporting renewables is the best solution we currently have to the energy ‘trilemma’ of cost, reliability and emissions. Yet, we can’t assume this is widely understood, let alone accepted. We’ve got to be ready to effectively, credibly and regularly explain the role of gas in reducing global emissions.
At the same time, winning the debate is not going to be enough. For the gas industry to capitalise on our natural advantages, we’ve also got to evolve the way we go about producing and selling gas. In other words, we’ve got to be innovating at the same time as advocating, so that gas truly becomes the reliable,
low-cost, go-to backup for renewables that we say it is.
In particular, we as an industry need to focus our efforts and resources on innovation in four key areas, to produce a new business model:
Energy efficiency to reduce costs and emissions, while increasing the volume of saleable product;
1. Contractual flexibility;
2. New uses and markets for gas; and
3. New and credible ways to offset carbon emissions.
George J. Gilboy, PhD, will share what Woodside is doing in each of these four focus areas, borrowing from our experience pioneering the LNG industry in Australia. We are lowering emissions by designing them out, operating them out and offsetting them. We are exploring options for integrating renewables and batteries with gas-fired power at our facilities, and developing a new business to develop and acquire carbon offsets at scale. We are developing new opportunities for LNG to displace higher-emission fuels, including in trucks, trains and ships.