Enverus Blog

Insights across the energy value chain

From our perspective, the declarations made and the agreements reached at The 2015 United Nations Climate Change Conference (COP 21) in Paris made little or no reference to the future role of natural gas. This fossil fuel, without any hesitation, is the source of energy that could make reality the binding arrangements agreed in Paris. Let us explain why.

At the end of this 2015 (percentages more or less for a simple understanding of the subject), the world energy matrix is composed of 30% coal, 30% oil, 25% natural gas and 15% of other source of energy, mainly those considered clean (hydro, solar, wind, etc.). Replacing the three fossil fuels (coal, oil and natural gas), which make up about 85% of the global energy matrix? Impossible with current technology and existing alternative energy resources that are not abundant, are mostly intermittent and still quite expensive.

Of the three referred fossil fuels, natural gas is by far the one with fewer emissions of CO2 to reduce global warming, which worry all of us. Natural gas CO2 emissions are lower in 40 to 50% when compared to coal and 25 to 30% to oil and oil products. Therefore, public policies of countries that signed binding agreements should be aimed at massively replacing coal and oil with natural gas. This will enable us to reduce emissions and reach the target of increasing temperature less than 2 degrees Celsius.

Abundant energy is imperative (storable and not intermittent) to sustain the world energy demand in the long run and thus trigger more economic growth and reduce poverty for millions of people. As we will see natural gas has this condition.

There are close to 6,550 trillion cubic feet (TCF) of conventional natural gas reserves that give us approximately 55 years of life at current rates of consumption. The recent technological breakthrough of shale gas gives us another 7,300 TCF and adds another 61 years. Total we have 116 years and of course there are more conventional resources and shale gas resources that could be discovered at a later date. Vast quantities of methane hydrates (natural gas) exist in several coasts of the planet and still don’t have technology to be developed commercially.

Thus, without any hesitation, natural gas is the source of energy that we have at hand for transitioning to other abundant and cleaner energy sources to be developed in the future.

We can name a number of other virtues and advantages of natural gas: combustion efficiency in combined cycle plants to generate electricity (about 70% vs. 35% of other fossil fuels), lower degree of parts weathering when used in engines and machinery, etc. But most important, natural gas can be used as backup for intermittent energy sources such as hydro, solar and wind power that we also need to be promoted to reach the objectives outlined in COP 21.

Countries that have signed COP 21, for the reason noted above, will have to promote public policies and strategies to favor new uses of natural gas to replace and slow down the burning of coal in power generation and oil in the transport sector. More electric vehicles based on electricity generated with natural gas and more vehicles with liquefied natural gas (LNG) or compressed natural gas (CNG) are policies that should be promoted in different countries.

Public policies and economic resources aimed at scientific research to develop more efficient storage, transportation and distribution of natural gas will be needed. The world needs less costly and more efficient pipeline systems, but especially LNG chain systems “big and small and modular type” that allows us to reach many more places and more users and especially more economically.
The planet will need to encourage and provide resources to the scientific community and universities to make technological improvements in applications and uses of natural gas. For example, bunkering systems in ports and airports for ships and planes to operate with LNG and heavy machinery also using LNG instead of diesel oil.

The cards are already on the table. We believe that Latin America can take advantage of the economic resources available from COP 21 to turn more towards natural gas and other alternative renewable energy sources such as hydropower, solar and wind. After COP 21, natural gas has become the energy source of the XXI century and we need to take leadership to develop strategies to boost its demand and uses even more. It’s in our hands to do so.

Your Turn

What do you think? Leave a comment below.

The following two tabs change content below.

Alvaro Rios

Managing Partner of Gas Energy Latin America and Drillinginfo