Shell aims to strengthen its focus on LNG over the next decade, with chief executive Wael Sawan saying that LNG will be the company’s “biggest contribution to the energy industry”, per a Reuters report that cited a statement by the executive.
Sawan noted that natural gas is one of the best fuels to reduce emissions in places that currently rely heavily on coal, such as China, India, and the rest of Asia. “We are absolutely committed to this sector,” he said, reiterating Shell’s prediction from earlier this year that demand for liquefied natural gas is set to expand by 60% between now and 2040.
The share of LNG in global natural gas trade will also increase as a result of the demand rise, from 13% at the moment to 20% in 2040. Production capacity will also expand. In the five years to 2030, more than 170 million tons of new LNG supply are expected to come onstream, mostly from the U.S. and Qatar, helping to meet stronger gas demand, especially in Asia. However, the start-up timings of many new LNG projects are uncertain, according to the Shell LNG Outlook published earlier in the year.
The supermajor is the largest LNG trader in the world and one of the biggest producers. Shell recently started production at its Canada LNG plant and is now considering making a final investment decision for Phase 2 of the project in Kitimat, British Columbia. While the previous Canadian federal government believed there was no business case for LNG in the country, the government led by Mark Carney considers Canada LNG one of five nation-building projects and is ready to support it.
“I don’t think I’ve ever seen the stars as well aligned as I see now in Canada,” Sawan said of that support, evident both on the federal and provincial government levels. “Everyone is really keen on that project materializing.”
By Irina Slav for Oilprice.com
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