Qatar’s energy minister yesterday shared a stage with the bosses of Exxon Mobil Corp. and TotalEnergies SE — the second time in three weeks he’d joined Big Oil to discuss the green transition.
But the main takeaway from the forum in Doha? Gas is here to stay.
The outlook of the two supermajors and the Gulf state — all large producers of the fuel — clashes with that of the International Energy Agency, which sees a peak in demand by the end of this decade.
Companies such as Total contend that gas is part of the solution to a warming world. They say it emits less carbon than coal or oil and is a more reliable source of power than intermittent wind and solar.
Alternatives such as hydrogen — seen by many as a key fuel of the future — are weighed down by steep costs, while meeting ambitious renewables targets requires a vast expansion of power grids across the world.
That creates space for gas.
Qatar, one of the biggest suppliers of liquefied natural gas, is investing billions of dollars in new capacity on a bet demand will climb. It may add even more if enough gas becomes available, Minister Saad Al-Kaabi said at the Qatar Economic Forum.
That confidence is underpinned by the long-term supply contracts the country has signed with Total and other buyers from Europe — multidecade deals that tie the continent to fossil fuels beyond 2050.
Such agreements have raised alarm in some quarters as climate change gathers pace. While gas emits less carbon dioxide than coal when burned, there’s concern that huge methane leaks across the LNG supply chain can make the fuel worse for the environment.
With mounting global calls to move away from all fossil energy, resource-rich states are making attempts to diversify. Even Saudi Arabia is adding renewables and carbon capture — and Qatari Finance Minister Ali Al Kuwari said his country is on the same path.
Yet the nation’s LNG expansion is making those efforts more difficult, he conceded. It’s an admission that encapsulates the growing acceptance that gas will play a core role for many years to come.
–Rakteem Katakey, Bloomberg News. The government of the State of Qatar is the underwriter of the Qatar Economic Forum, Powered by Bloomberg.
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