Petronas delivers first carbon neutral LNG cargo to Japan’s Shikoku Electric
Malaysia’s national oil company Petronas has completed the delivery of its maiden carbon neutral liquefied natural gas cargo on Aug. 17, from the Petronas LNG Complex in Bintulu to Shikoku Electric at the Sakaide LNG terminal on Shikoku Island in Japan, the state-owned company said on Aug. 18.
The shipment comes amid growing interest in carbon neutral LNG, in which the emissions footprint of the fossil fuel is reduced and mitigated through carbon offsets, particularly to buyers in Asia. LNG producers are also increasingly investing in projects like carbon capture and storage and renewables-based electricity to lower their carbon intensity.
The estimated life cycle carbon footprint of the Petronas LNG cargo was offset through renewables-based carbon credits, certified through a rigorous verification process under the Verified Carbon Standard program, for the emissions generated from upstream gas exploration and production, transportation, liquefaction, and shipping of the cargo, Petronas said.
The company did not specify whether the carbon emissions from the combustion of the LNG cargo will be covered. It also didn’t provide any details on the pricing of the cargo.
“Reflecting our support of the energy transition and in line with our Statement of Purpose, Petronas will continue diversifying our products and offerings to the market, while transforming ourselves to be a cleaner and more sustainable energy provider,” Petronas President & Group Chief Executive Officer, Tengku Muhammad Taufik said.
Petronas is reducing its carbon footprint throughout its LNG and gas supply chain through flare recovery, carbon capture and storage from offshore gas fields.
In early August, Italy’s Eni said it would deliver a carbon-neutral LNG cargo to Taiwan’s CPC Corp. at the Yung An receiving terminal from the Bontang liquefaction facility in Indonesia as part of its contract with Eni Muara Bakau, the joint venture operated by Eni that owns and operates the Jangkrik gas field.
In June, S&P Global Platts launched the world’s first daily carbon-neutral LNG price assessment, which tracks the cost of carbon credits purchased and retired to offset the carbon emissions for an LNG cargo on the world’s most active trade route for LNG cargoes loaded in Australia and delivered to Japan, Korea, Taiwan and China.