A new analysis cites carbon capture and storage as a “costly and largely untested technology” that U.S. liquefied natural gas (LNG) developers are counting on to “burnish their green credentials and boost their competitiveness”.
While gas giants Cheniere Energy and Sempra Energy both launched big, new carbon capture (CCS) initiatives last week, “the moves remain largely hypothetical, with neither company offering up a timeline or a budget for investing in the green projects they floated,” reports Bloomberg Business. “While federal tax credits are available for carbon capture, the technology isn’t currently economic and hasn’t been deployed at a commercial scale.”
The industry’s motivation is to “clean up its image and bring a dozen stalled projects into development by landing contracts with environmentally conscious buyers in Europe and elsewhere,” the news agency adds. “While American LNG is among the cheapest in the world thanks to abundant shale gas, its carbon footprint is significant. The European Union, a key U.S. export market, has sought to pressure American firms to slash their emissions as the bloc tightens its own carbon goals.”
“I think we’re committed and have committed some real dollars to development and engineering,” Cheniere CEO Jack Fusco told investors Tuesday. “I think our customers are going to expect us to continue to offer a sustainable LNG product.”
“The greening up of the value chain here in North America is something the sell side and buy side should follow because I suspect that it will make America increasingly competitive over time,” Sempra CEO Jeff Martin added Wednesday.
But even if the companies can make CCS a green, cost-effective reality—something that may be far easier said than done—“a cleaner footprint is no guarantee that the global LNG market will support the development of new export facilities,” Bloomberg writes. “Annova LNG last month scrapped plans to build one of the greenest proposed export facilities in the U.S., citing ‘changes in the global LNG market’.”