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ore than 100 countries have pledged to reach net-zero emissions in the next 30 years, but as these countries work to define the scope and priorities, the energy industry faces one of the greatest challenges of the 21st century. How to address global emissions and climate change while meeting the rising demand for energy and furthering economic growth and prosperity? Efforts like deploying all available clean energy technologies – such as renewables, hydrogen, and ammonia – are ongoing. However, natural gas is projected to become one of the largest global energy sources by 2040. As these other technologies mature and are deployed at scale, natural gas will continue to be an important complement to renewable generation and is expected to displace higher carbon-emitting fuels such as coal and oil in a variety of markets well into the future. According to the US Energy Information Administration (EIA), since 2005, shifts in electricity generation from coal to natural gas and renewable energy have reduced cumulative US CO2 emissions by 5475 million t, with more than 60% of that reduction occurring due to a shift to natural gas. US LNG is already contributing to lowering global emissions by displacing more carbon-intensive fuel sources, especially in developing markets hungry for reliable energy. Decarbonising the LNG value chain will be key to enhancing the climate benefits of an expanded use of natural gas. Sempra LNG’s infrastructure platform is well-positioned to lead in the energy transition.
Role in the global energy transition
Sempra LNG is one of the US’s leading LNG companies. Sempra LNG owns a 50.2% interest in Cameron LNG, a 12 million tpy export facility operating in Hackberry, Louisiana (Phase 1) and is working with Cameron LNG on a proposed expansion of the facility (Phase 2) through one additional liquefaction train with an offtake capacity of over 6 million tpy. Sempra LNG and its partners, IEnova and TotalEnergies, are also building the 3 million tpy ECA LNG project (Phase 1) in Baja California, Mexico. ECA LNG Phase 1 is the only project in the world to achieve a Final Investment Decision (FID) in 2020. ECA Phase 1 has started construction, and the first production of LNG is expected by the end of 2024. Sempra LNG is firmly committed to the proposition that the US’s new role as a global leader in LNG exports can enable the same greenhouse gas (GHG) emissions reductions that the US has demonstrated in the electricity sector worldwide. Beyond the electricity sector, Sempra LNG believes that US LNG exports are critical to quickly lowering emissions in hard-to-decarbonise sectors that are today fuelled by higher emitting coal and oil energy sources. Climate change is a global problem. The EIA projects that 80% of global energy demand
Paty Ortega Mitchell, Sempra LNG, USA, considers the route to decarbonisation and how the company’s infrastructure is wellpositioned to lead in the energy transition. Figure 1. Sempra LNG owns a 50.2% interest in Cameron LNG, a 12 million tpy export facility operating in Hackberry, Louisiana, US (Phase 1) and is working with Cameron LNG on a proposed expansion of the facility (Phase 2) through one additional liquefaction train with an offtake capacity of over 6 million tpy.
through 2050 will occur in emerging and developing economies and effective climate policy must recognise that US exports of lower-carbon energy will be critical to helping these markets achieve sustainable growth. Efforts to further decarbonise the US natural gas value chain will be critical to achieving even greater GHG reductions domestically and globally, and Sempra LNG is leading the way. In July, the company announced the first carbon offset LNG cargo delivery to its Energia Costa Azul facility. While the company expects natural gas to continue to play a crucial role in the energy transition, it is also examining the potential to leverage existing facilities in combination with investments in new infrastructure opportunities in nextgeneration energy technologies including carbon capture and sequestration and low-carbon hydrogen. In December 2020, Sempra announced an integrated series of transactions to form Sempra Infrastructure, a new business focused on developing, building, and operating North American energy infrastructure. Sempra Infrastructure will be formed through the business combination of Sempra LNG and IEnova, with a view toward creating a larger platform to capture new opportunities that support the clean energy transition. During the recent Sempra Energy Investor Day, Justin Bird, CEO of Sempra LNG, announced the company’s initiative to expand its LNG business focus to include net-zero solutions to support its customers and help position the US as a global energy leader. “Our infrastructure provides services and solutions to our customers to help reduce GHG emissions and
Figure 2. Sempra LNG and its partners are adding
liquefaction capabilities to the Energia Costa Azul regasification terminal in Mexico. ECA LNG is the only project in the world to achieve a Final Investment Decision in 2020.
Figure 3. Last July, the newly built BW Helios made its
inaugural voyage and arrived at Energía Costa Azul with the first carbon offset LNG cargo to Mexico.
Reprinted from September 2021
facilitate the energy transition,” said Bird. “We use innovation and technology to improve all aspects of our business, and we are excited to expand our investments to emissions reduction technology, carbon capture and sequestration, hydrogen, and battery storage.
Decarbonising the energy value chain
LNG terminals operating and under construction in southwest Louisiana and southeast Texas have enabled the US to become a global leader in exporting natural gas to foreign markets. Increasingly, customers of these facilities are seeking natural gas sourced through lower-carbon processes to meet their energy needs and are looking to US suppliers to accomplish their goals. Sempra LNG is actively advancing the utilisation of new technology that can significantly reduce the GHG emissions associated with the liquefaction process, as part of a broader suite of lower-carbon initiatives. The International Energy Agency highlighted a potential need for carbon dioxide storage to increase from approximately 40 million tpy today to more than 5000 million tpy by midcentury. Today, the US is the global leader in carbon capture, use, and sequestration (CCUS), holding more than 60% of current CCUS capacity and half of all global CCUS capacity under development. Sempra LNG is in the early stages of development of the Hackberry Carbon Sequestration project in southwest Louisiana. Projected to have the capacity to store a total of 89 million t of CO2, this facility could have the potential to serve as a permanent geologic repository for CO2 not just from LNG facilities in the area, but other industrial facilities along the US Gulf Coast. Sempra LNG has been actively evaluating the incorporation of e-Drives for the refrigeration compressors for Phase 2 of Cameron LNG as well as other future LNG projects such as the Port Arthur LNG project in Texas. When paired with zero carbon electricity from the power grid, this technology will not only increase LNG production, but will also have the potential to reduce the liquefaction facility’s GHG emissions by 60 - 65%. Together with carbon capture and sequestration, overall emissions in the liquefaction facilities can be reduced by as much as 80 - 90%. Beyond the LNG terminals, Sempra LNG is committed to working across the value chain to reduce emissions. As a member of the Collaboratory to Advance Methane Science, the company is funding research to improve the quantification and measurement of methane emissions with the goal of identifying best practices to drive these emissions to zero. Sempra LNG is also actively engaged with industry partners to develop advanced frameworks for the reporting, mitigation, and reduction of GHG emissions, including a recent memorandum of understanding with the Polish Oil & Gas Company to advance the best practices in this area and the aforementioned agreement with bp to deliver a carbon offset LNG cargo to the Energía Costa Azul facility. “Through the combined strengths of our assets in North America, we are dedicated to investing in infrastructure to build the energy systems of the future,” Bird noted in his Investor Day comments. “We’ve demonstrated the capability to build large scale infrastructure and expect to have meaningful opportunities to grow and invest in infrastructure that will helps us meet Sempra’s net-zero emissions goal.”