Optimising the LNG value chain to meet global energy demands
The Australian LNG industry will play a pivotal role in energy security as the world transitions to renewable energy, Chevron general manager, LNG value chain optimisation, Mark Rose told the Energy Club October dinner.
He said the energy sector volatility linked to supply chain disruptions caused by Russia's invasion of Ukraine necessitated a global response.
“All of us, no matter what element of the energy sector that we're working in, will have to come together to solve both the energy requirements that our planet needs, alongside the climate challenge,” Mr Rose said.
He said countries around the globe would have increasingly significant energy demands over the next few years and leveraging Australia’s abundance of resources including space, sunlight, wind, and suitable reservoirs to sequester carbon provided a competitive advantage to become an energy solution provider.
“It’s a very promising, bright future for Australian LNG when it comes to the global supply situation,” Mr Rose said.
“Australian LNG will definitely be part of the energy supply mix into Asia and be competitively-advantaged.”
The world’s population was growing in number as well as in its desire to consume energy and promote economic growth.
However, hundreds of millions of people across the globe did not have access to reliable energy, which was why the industry needed to consider different and emerging fuels to complement current supply.
“We need to grow our capacity to produce energy, and we need to do it in an ever greener, ever cleaner way,” he said.
“When it comes to renewable fuels, this is an adjacent business sitting alongside more traditional fuels, so gas is going to be around for a while.”
Mr Rose highlighted the current energy crunch in the UK, where some people were turning to wood fires because electricity was getting too expensive.
“The role that we can play right now is to keep producing safe, reliable, affordable energy, and the West Australian market is one that balances very well their domestic gas and LNG exports,” he said.
According to Mr Rose, carbon capture and storage (CCS) would form a vital part of producing greener energy.
He said Chevron has committed to achieving net zero carbon emissions by 2050 for its Gorgon and Wheatstone CCS projects. Since 2019, it has sequestered nearly 70 million tonnes of CO2.
“Chevron firmly believes that natural gas and LNG form part of the solution, which is why we are expanding the LNG business. That's why we are going down this pathway of carbon sequestration,” Mr Rose said.
Up to 80 per cent of emissions produced across the LNG value chain are from the burning of natural gas.
Mr Rose said that carbon capture post-combustion remained the key to significantly reducing the carbon footprint of natural gas.
“We have to try and decarbonise, as effectively as we can, the entire value chain,” Mr Rose said.
“We will not be successful in hitting our net zero emissions targets if we focus on one particular segment. It has to be a holistic view.”
Mr Rose said Chevron was interested in a company called Blue Planet, which is looking at ways to permanently lock CO2 into cement, with a target of sequestering a billion tonnes.
“It's a good way of not only solving how to sequester CO2 but also solving one of the critical, heavy emitting issues that we've got as a planet,” Mr Rose said.
“The only commodity that is consumed more than cement is water.”
According to Mr Rose, adopting an industry-wide way of measuring scope one and two emissions would provide a consistent tool to measure the carbon intensity which could then be used to cut a company’s carbon footprint on a consistent basis.