More of a buzz than usual at the Gas Asia Summit in Singapore this year. Gone were long faces about low prices — indeed, the big players in LNG seems to have forgotten the supply glut ever happened. The mood was upbeat: not quite business as usual, more like a shot of strong coffee after a heavy night out. I had a feeling that people were rolling up their sleeves having made some big decisions. GAS was part of Singapore International Energy Week (SIEW) and as ever the island is buzzing.
This conference had three big takeaways for me:
Canadian LNG is no longer a pipe dream. It will happen, and it will probably be on a big scale. The Shell FID gave a clear signal that, despite the complex permitting process, it can be done. A Canada spotlight panel reckoned that Canada could have 5-12 liquefaction projects up and running by 2030, on both the east and west coasts. Exports will be of the same magnitude as those from the US, Qatar or Australia.
LNG in shipping is becoming a reality. Shipyards are busy preparing vessels for the IMO 2020 regulation, but older vessels will be scrapped rather than retrofitted. The next generation of boats will be dual-fuelled or LNG ready, but the yards also have orders for LNG-fuelled vessels from barges to tankers. What we are seeing now is the seeds of a new industry. This is no longer something that is waiting to happening, it is happening now.
Islands are getting smart about energy. Advising SIDCs on fuel supply has always been my idea of a dream job, and I met a gentleman who was doing just that over lunch. LNG is the fuel of choice, as it ticks all the boxes: lower carbon than diesel, energy intensive, resilient and with lower investment cost than alternatives such as energy storage.
Mega-trends
After a conference, it’s important to think about what was not said, as well as what was said. Were there elephants in the room that no-one talked about? Yes. A whole herd of them. Here are just two:
The benefits of LNG vs diesel are crystal clear, but I felt that many in the gas industry were in denial about the potential for energy storage. Maybe batteries are the next big story, despite all the skepticism. Lithium has already had its first supply shock, after prices soared above $20,000/t a couple of years ago because supply couldn’t meet demand. The battery brigade are already looking at lithium alternatives such as selenium, costs are declining, and battery life and range improving. It cannot yet replace gas as a backup fuel for intermittent renewables, but by 2030? Perhaps.
King Coal has lost its crown, but no-one seems to entertain the idea that coal might make a significant comeback. I never understood the idea of Clean Coal, but if Carbon Capture and Use (CCU) were possible on a large scale, it would be a game-changer. Researchers are looking into ways to solidify emissions and potentially also finding uses for the solids. The dash for gas in China and India has been driven as much by air quality concerns as GHG emissions. CCS as a carbon disposal technology remains out of reach, but CCU could be a game-changer.