In an aim to decarbonize the liquefied natural gas (LNG) value chain, Shell Eastern Petroleum has signed non-binding memorandums of understanding with its Japanese-based clients Tokyo Gas and Osaka Gas.
The first MoU focuses on developing several potential solutions such as CO2 capture, utilization and storage, hydrogen, biomethane, and renewables-based synthetic gas. The second looks at opportunities involving synthetic gas produced with renewable energy such as wind and solar power.
“Based on the framework of this agreement, we will continue to develop solutions to achieve a decarbonized society, including studying the possibility of a demonstration project that will contribute to the establishment of a synthetic gas supply chain,” said Kentaro Kimoto, head of the Digital Innovation Division at Tokyo Gas.
This collaboration is taking place at a time when the US is focused on sending more LNG to Europe as the sanctions on Russia are shifting demand. Meanwhile, companies part of the LNG value chain are asked to decrease emissions brought upon by liquefaction, shipping, and regasification.
“We have been delivering LNG to Japan for over 50 years (…) and we are delighted to be collaborating with Tokyo Gas and Osaka Gas on exploring the potential of developing a range of low-carbon energy products and solutions (…) to meet their decarbonization needs,” said Steve Hill, EVP Shell Energy.
Generally, the LNG industry favors efforts to reduce CO2 emissions in the production and transport of liquefied natural gas rather than use carbon offsets, while carbon-neutral LNG is still underdeveloped.
Carbon capture, while usually more associated with the gas and oil value chain, is still in the picture for LNG. For example, the US-based TotalEnergies recently said they plan a carbon-capture project at Cameron LNG which will capture and sequester CO2 from several sources. There are also companies that aim to decrease the ecological footprint of LNG via certification.
Lowering the intensity of carbon emissions from natural gas production and shipping is critical in a world aiming to become truly net zero and developing carbon capture technologies is one mitigation pathway. The new collaboration of Shell on LNG decarbonization would meet the needs of the industry for energy sources with the lowest possible carbon footprint.