Alex Volkov, Vice President & Head of Global LNG Marketing of ExxonMobil, co-hosts of Gastech; on the global prospects for the energy industry and the return of the event to the United States
What do you see as the future role for natural gas and LNG?
As governments around the world are seeking cleaner energy solutions, and populations are demanding a cleaner and affordable energy future, natural gas is ready to take on a much more prominent role in the energy mix.
One bold step is to accelerate the replacement of coal-fired power generation with natural gas. Natural gas produces up to 60 per cent fewer CO2 emissions than coal, leading to significantly fewer pollutants, which in turn would have huge environmental benefits.
In addition to its ability to replace coal, natural gas is also the ideal partner to support power generated by intermittent renewables (solar, wind, etc). It is reliable, efficient and flexible – making gas well suited to help meet peak demand and play a crucial role in securing our cleaner energy future.
LNG in particular is a game changer, allowing us to ship this cleaner burning fuel in quantities that we have not seen before, to destinations where it’s needed all over the world.
What is ExxonMobil’s LNG strategy going forward?
In the global LNG market, ExxonMobil LNG will provide a robust and flexible portfolio, creative commercial offers, an ongoing focus on technology and efficiency, and an absolute commitment to deep, mutually beneficial relationships.
Technology is becoming ever more critical as a key differentiator. Over our 25 years in the LNG industry, we have developed technologies to design and build the largest trains and tankers, become more efficient, and reduce costs and emissions. This focus on technology, efficiency, as well as flawless project execution, is the key to our future growth strategy.
How is ExxonMobil continuing to invest in gas and LNG?
The LNG value chain is complex and capital intensive. There are three recurring strengths that make ExxonMobil the partner of choice at every link in that chain – proven project execution; attention to safety and the environment; and unparalleled financial strength. We also highly value the customer relationships that we have established over many years, making us a reliable partner of choice.
ExxonMobil is currently one of the world’s leading producers of natural gas, with new projects and expansions in places like Papua New Guinea, Mozambique and the U.S. Gulf Coast.
At our Papua New Guinea project we’re planning to double our capacity to 16 million tons per year by adding three new trains. In Mozambique, we’re making good progress on our plans in Area 4. Construction is continuing on the Coral South floating LNG project, led by ENI, which is expected to start up in 2022.
In Russia, jointly with our Sakhalin-1 project co-venturers, we are beginning preparations for FEED for the RFE LNG (Russia Far East LNG) project. The proposed project will include expansion of the Chayvo onshore processing facility, construction of an approximately 200-kilometers long gas pipeline and a 6.2 MTA liquefaction plant located near the Sakhalin-1 De-Kastri oil export terminal in Khabarovsk Krai.
What are the main challenges facing the gas and LNG industry?
We see a number of opportunities in the industry, including increased supplies from a geographically diverse resource base, greater liquidity, more competition and a growing number of buyers and sellers. That said, there are also a range of challenges that confront us including the competitive development of gas resources during a time when CAPEX investments are high; and advocating the advantages of natural gas to governments, infrastructure investors and societies.
What is the significance of having Gastech come back to the U.S. after 20 years?
As the U.S. is now a major LNG producing country, it’s a great time to welcome Gastech back, and in particular to Texas, home to our Houston campus with over 10,000 employees working across the oil and gas value chains.
From an LNG perspective, we recently announced plans with Qatar Petroleum to proceed with the Golden Pass LNG export terminal on the Texas Gulf coast. It will have the capacity to produce around 16 million tons of LNG for export per year, starting in 2024.
The project leverages the long-term relationship we’ve had with Qatar Petroleum and the strengths of both our companies.
At ExxonMobil, we are proud of the role we are playing in helping to supply low-cost LNG to our customers, to fuel economic growth, improve living standards and reduce emissions. We’re excited about the prospect of powering growth and prosperity for years to come.
Alex Volkov will be speaking at Gastech on September 17 as part of the Global Business Leaders’ Panel at 16.30 pm on “How can buyers and sellers find a balance to co-operate and develop strategies for long-term market growth?”