As the gas world gathers in Singapore, it’s time to take stock

As we prepare to welcome thousands of industry participants to Singapore for Gastech 2023 (Sept 5-Sept 8), it’s an opportune time to reflect on the current circumstances of the energy world. 

Gastech 2022 in Milan took place shortly after natural gas prices hit their highest point for more than a decade. The impact of Russia’s invasion of Ukraine meant “crisis” was a word frequently used in relation to the global energy situation. 

There is probably a public perception of market stabilisation since those volatile times and it’s true that gas and LNG prices have dialled back since the heights they hit in May and August of last year. 

But people within industry know any outward look of stability masks ongoing precariousness. Gas usage in the 2022-23 European winter was tempered by milder-than-usual weather and it would be unwise to rely on that continuing. 

The reality is that global gas and LNG supply will remain tight until at least the middle of the decade, when more supply starts to come online from the US, Canada and the Middle East. 

Establishing ANGEA on the international stage 

Gastech 2023 is something of a milestone for the Asia Natural Gas and Energy Association (ANGEA), marking the completion of our first year of full-scale operations. 

I joined ANGEA as inaugural CEO in August 2022, as someone long fascinated by the energy systems of Asia but who knew he had a lot to learn. The past 12 months have comprised a very valuable learning curve for both ANGEA and me. 

As an organisation, ANGEA has undertaken a variety of positive engagements in Thailand, Indonesia, Vietnam, Japan and South Korea. We are headquartered in one of the world’s premier energy hubs in Singapore, and I have been fortunate to have the opportunity to travel to Houston, Washington DC, Sam Ramone, and Vancouver, as well as my native Australia. 

Our world’s energy systems are incredibly complex. No two countries have the same profile and none will have the same pathway in energy transition. There is also no single technology to drive decarbonisation – all options must be on the table. 

ANGEA was formed in 2021 to work with governments, industries and companies around Asia in tackling this complicated equation. Our membership comprises large global energy companies spanning the entire supply chain, with energy transition a central focus. 

Already we see many green shoots in Asia. 

In Thailand, where we have been working productively with government and energy officials over the past year, there is a strong desire to become a regional hub for low carbon energy solutions, including LNG. 

In Indonesia we have had very constructive engagements with a range of ministries, energy organisations and industries about the potential to develop a carbon capture and storage (CCS) industry. CCS will be critical to decarbonisation worldwide but is particularly relevant for Asia because of the major industrial clusters around the region and plans for rapid economic growth from many countries. 

One of those countries is Vietnam, which ANGEA visited for the first time in July. Vietnam has ambitious plans for LNG to underpin electricity generation but is also a fresh entrant to the LNG importing ranks and requires significant infrastructure investment to support its shift away from coal. 

Around the region, Malaysia’s progress towards developing a CCS industry is exciting, the Philippines is another new and potentially significant LNG buyer, and China and India, the world’s two most populous countries, continue to make encouraging steps towards increasing the role of gas in their energy mixes. 

The pathway ahead for Asian energy transition 

At the same time as we are encouraged by progress on energy transition, it’s important to consider some of the barriers and challenges that arise along the way. 

Availability and affordability of natural gas and LNG are clearly among them. Europe’s pivot to LNG since the start of the Russia-Ukraine war makes complete sense from the perspective of its own energy security and energy transition, but unintended consequences have been felt strongly here in developing Asia and other less wealthy parts of the world. 

Many of the world’s developing economies aspire to reduce emissions by switching to natural gas in power generation. However, when gas and LNG are out of reach from a pricing perspective – as has often been the case over the past two years – these countries fall back on a fuel that is affordable and available. 

In Asia’s case that fuel has largely been coal, which produces around twice the emissions in electricity generation that natural gas does. 

Gastech is an excellent forum to bring countries, industries and companies together to celebrate achievements in energy transition and talk realistically about opportunities and challenges that lie ahead.  

Energy transition doesn’t recognise borders and nations must work together on solutions and policies to support it. It’s been very pleasing to see nations such as Japan, South Korea and Singapore actively leading regional decarbonisation collaborations in Asia. 

Gastech also provides an avenue for Asia’s gas-consuming nations to engage meaningfully with gas-producing countries from other parts of the world. 

Over the next three decades, nations in Asia must strike a difficult balance: meeting rapidly growing energy demand that will help bring tens of millions of people out of poverty, while also making progress on climate targets. 

The recent Rystad Energy Study Into Energy Security in Southeast Asia, commissioned by ANGEA in partnership with the American Petroleum Institute, made it clear that natural gas is the best energy source to support credible energy transition in Asia. 

Yet it’s also an energy source where Asia’s demand will far outstrip its domestic resources. 

Successful energy transition in Asia, therefore, depends on trusted gas-producing partners like the US, Australia and the Middle East continuing to bring on additional supply, and newcomers like Canada and Africa entering the LNG market. 

It will also depend on learning from the experiences of countries around the world in carbon capture and storage implementation, development of fuels like hydrogen and ammonia and the blending of widescale renewables with more traditional forms of baseline power. 

Gastech, with its blend of conference and networking activities and truly global scope, is perfectly placed to support that kind of learning. 

Paul Everingham is the inaugural CEO of the Asia Natural Gas and Energy Association (ANGEA), which works with governments, society and industry throughout Asia to build effective and integrated energy policies that meet each country’s climate objectives. Paul will be attending Gastech and also taking part in a panel session on carbon capture and storage (CCS) as part of the strategic conference.