Natural gas at a turning point

Increased cooperation between producers and buyers, digitalisation across the value-chain, investment in infrastructure and research and development in innovative technologies will play a pivotal role in positioning natural gas as a fuel of choice for the 21st century global economy.
These were some of the key messages by international gas industry leaders and panellists who participated in the 3rd GECF Annual Workshop on Promotion of Natural Gas Demand held virtually and organised by the GECF (Gas Exporting Countries Forum).
The speakers opined that natural gas is the fuel that can achieve the UN Sustainable Development Goals and the objectives of Paris Agreement as its credentials far outweigh that of other energy sources such as coal and oil.
GECF Secretary General Yury Sentyurin said: «We recognise the vital role that natural gas has to play in energy transition and sustainable development as we strive for energy security for all nations. Now more than ever, there must be a spirit of collective collaboration amongst industry players in order to sustain existing markets, and more so to create new promising ones.»
«We also recognise the crucial role of digitalisation as we strive to reduce cost across the natural gas value chain and enhance the competitiveness of natural gas.»
The keynote speakers included President of International Gas Union (IGU) Joe Kang, Executive Chairman of African Energy Chamber N J Ayuk, Chairman of Egyptian Natural Gas Holding Company (EGAS) Magdy Galal, and Vice-President LNG Marketing and Trading of Petronas Shamsairi Mohd Ibrahim.
Ayuk emphasised the crucial need for development of the gas industry in Africa through investment in infrastructure and industries.
In his comments, Dr Galal pointed out the steps taken by the Egyptian government in stemming the decline in consumption in Egypt due to the Covid-19 impact.
The country saw a drop in demand by 13 per cent between January and May 2020 compared to last year. He said despite the government having lowered the price of gas in the industrial sector, more incentives were needed to be provided by it, especially in the upstream activity by providing flexible terms in the concession agreements.
Speaking on behalf of Petronas, Ibrahim said the rising number of LNG importing countries, from merely 15 in 2005 to 39 countries in 2019, shows that LNG is well positioned to prosper as the most significant source of energy in the future.
He also highlighted some solutions including LNG bunkering, virtual pipeline system, small-scale break-bulking and vertical integration that will create new and niche markets.
GECF Gas Market Analysis Department Head Mahdjouba Belaifa spoke about the importance of the annual workshop for the industry and the GECF’s role in aligning many voices as one voice.
She explained that in the previous two workshops the key identified areas for natural gas were held with a focus on cost competitiveness, policy advocacy, importance of long-term oil indexed contracts for the security of supply, development of infrastructure, and new business models.
She highlighted some of the proposed actions after the workshops such as reinforcement of dialogue, role of R&D, fair access to technology, engagement of policymakers in advocacy for fair policies towards natural gas, the role of social media to sensitise various segments of the public, as well as digital technologies to improve productivity.
In a panel discussion, ‘Improving the competitiveness of natural gas through Cost Optimisation and Digitalisation’, the participants discussed a number of themes affecting the global gas and LNG markets.
Robbin Mills, CEO of Qamar Energy, focused his views on the Middle East region, where he mentioned that gas demand growth is expected to shift from power to the industrial sector in the long-term due to increasing renewables deployment and improved efficiency.
As it relates to a gas surplus in the region, this could bring several opportunities, including new lighter industries, intra-regional export projects (gas, LNG and electricity), enhanced oil recovery, hydrogen production, and expansion of e-vehicles, which will support a growth in electricity demand.
Vincent Demoury, General Delegate of International Group of LNG Importers (GIIGNL), held the view that although LNG has been growing at a healthy pace over the last few years it faces several challenges in a post-Covid-19 world, including economic growth, volatility, affordability, and environmental policies.
As such, there is a need that producers, consumers, and policymakers work together to develop methodologies and invest in technology for decarbonising the gas industry and innovation to improve its competitiveness and sustainability.