Climate change, geopolitical conflicts, and policy shifts can lead to energy supply disruptions and price volatility. As extreme weather events become more frequent globally, the harmful impacts of climate issues are not limited to the short term, often also bringing indirect harm and long-term severe challenges. Geopolitical events are more likely than ever to shake up international energy markets, threaten energy security and accelerate the restructuring of the global energy landscape. What strategies should policymakers and market participants adopt to shape a more resilient energy system to address the challenges of climate change and geopolitical tensions？

Energy security, affordability, and sustainability are the three key dimensions of the “energy trilemma”. Faced with the dual issues of meeting escalating energy demand while addressing the global climate crisis, countries contend with the challenge of achieving all three key dimensions simultaneously. Even though economies at different stages of development require different measures, any successful and lasting energy transition should balance the three major elements of the "energy trilemma".

What must happen to achieve energy security, affordability and sustainability?

According to the “14th Five-Year Plan for Developing a Modern Energy System” issued by China, in order to promote safer and more secure energy, China will further increase domestic oil and gas exploration and development and enhance oil and gas supply capabilities. The plan specifies for the annual natural gas output to reach over 230 billion cubic meters by 2025 while enhancing the capacity of natural gas storage and regulation by advancing the construction of underground gas storage facilities and LNG terminals. To expand the coverage area of the pipeline network, China will accelerate the construction of long-distance and regional natural gas pipelines.

It is predicted that natural gas consumption in China will reach 550 billion cubic meters in 2030, with peak consumption expected to occur in 2040 at about 650-700 billion cubic meters. Differences in resource reserves, economics, and infrastructure have led to varying growth potential and development characteristics in China’s regional gas industry.

What are the opportunities for the domestic development of China's gas industry? How can China more actively engage in transnational cooperation under multilateral mechanisms to contribute to the global gas industry?

Achieving global net-zero goals requires the collective effort of multiple parties. Cooperation between countries, industries, companies and organizations is key to addressing the challenge of methane emissions. Significant progress in methane mitigation has been achieved in the past through cooperative agreements, forming alliances, and launching initiatives. What collaborations or partnerships are needed to accelerate methane emission reduction?

The useful life of the current global natural gas infrastructure ranges from 1 to 75 years. The growing demand for natural gas requires investment in new infrastructure while also maintaining and upgrading ageing infrastructure. Additionally, the global gas industry is advancing the deployment of zero- and low-carbon gases such as hydrogen, biomethane, and e-methane. This new energy landscape will require repurposing and reutilization of existing gas infrastructure.

Where should the focus and priorities for the advancement of infrastructure be to best prepare for future development?

Investment in clean energy solutions is ramping up as governments and businesses race to meet ambitious decarbonisation targets. Solutions include utilizing low-carbon clean energy and renewable energy, deploying innovative technologies to address the most challenging emission sectors’ emission reduction and tackling residual emissions. Existing climate change technologies, such as CCS, CCUS, CDR, and DAC for traditional fossil energy sources already contribute to achieving Net Zero. It is estimated that by the early 2030s, annual investment of 4.5 trillion USD per year is needed to accelerate deployment and construction across all clean energy technologies and infrastructure.

How can funding for large-scale development and utilisation of low and zero technologies be secured to achieve Net Zero?

The expansion of Artificial Intelligence (AI) applications across various fields has a profound impact on future society. The notable economic advantages and swift growth in AI applications reveal significant potential for innovation, efficiency, and profitability in the gas industry. AI optimizes supply chain management by providing insights into demand forecasting, inventory management, and logistics planning. Predictive analytics can anticipate demand fluctuations, allowing companies to adjust their supply chain operations accordingly. AI provides deep insights through advanced data analytics, supporting more informed decision-making across various stages of the gas value chain. From exploration to production and distribution, AI-driven insights help companies optimize their operations. Better decision-making leads to improved efficiency, and cost savings. Additionally, AI helps in identifying new opportunities and mitigating risks.

How quickly must companies adopt and adapt these technologies to stay competitive?

In recent years, global LNG markets have experienced rapid expansion, with growing demand and production facilities coming online globaly. According to IEA forecasts, many LNG projects will come online in 2025, leading to unprecedented growth in global capacity. By 2030, the annual global LNG production capacity is expected to exceed 250bcm, equivalent to about 45% of the current total global supply. This significant increase in production capacity has reduced concerns about price, supply, and energy security. Given the likely slowdown of global natural gas demand growth and growing concerns about climate change, is investment in LNG projects still viable?

“New gases”, including hydrogen, ammonia, biomethane, and synthetic methane, play a pivotal role in fulfilling the emission reduction commitments of the gas industry. There have been numerous breakthroughs in the development, production and deployment of these gas sources, which are essential for advancing their large-scale application.

What policy adjustments are needed to promote the large-scale application of "new gases"?

Currently, fossil fuels account for over 70% of global greenhouse gas emissions, which governments around the world are looking to reduce to achieve Net Zero goals over the next 50-70 years. In response to climate change, nations worldwide have introduced energy and climate policies, such as the EU's Fit for 55 and the US Inflation Reduction Act. With a growing global population and advancing urbanization, energy demand is increasing day by day. There are high hopes for low-carbon energy, including natural gas, hydrogen, ammonia, biogas and renewable energy. Against the backdrop of growing global demand for accessible, affordable, and reliable energy sources, natural gas is currently seen as a critical and viable solution. Additionally, governments continue to craft policies to reduce carbon emissions, forcing the industry to invest in current solutions like CCS and CCUS while still responding to the ever-growing demand.

How do energy and climate policies better promote the green and low-carbon development of the energy industry?

The three main pricing mechanisms for natural gas commodities are gas-to-gas competition pricing, oil-linked pricing, and government-regulated pricing. No matter which pricing method a country or region adopts, market participants are inevitably subject to the impact of price fluctuations. Policy adjustments, political events, supply and demand dynamics, and other factors can all cause significant volatility in natural gas prices. If prices suddenly spike or drops, producers, consumers, and traders will encounter corresponding trading risks. Price fluctuations can also lead to insufficient market liquidity and supply shortages.

What strategies should market participants adopt to cope with natural gas price fluctuations?

The global public and political consensus on achieving net-zero emissions has made traditional energy industry financing is proving difficult. Most banks and other investors that provide financing for oil and gas projects will find their investments come with stricter conditions when assessing and monitoring the environmental and social impact of projects. Transition financing introduces funds into private investment projects to reduce current high greenhouse gas emissions and help all industries transition to a carbon-neutral and sustainable economy. Financial institutions must be able accurately interpret international standards and methodologies for transition finance to effectively identify green energy projects. How can the capacity building of transition finance be enhanced to provide essential monetary support for the long-term development of the gas industry？

Europe has led the development of “natural gas” and “new gases” and has extensive experience in energy policy, the adaptation of new technology and operation management. Renewable energy development has gained traction and is becoming more prevalent in the region’s energy mix. What role will natural gas continue to play in the context of Europe’s energy transition?

Similar to the human brain, smart energy systems self-inspect, self-balance, and self-optimize. They meet the requirements for reliability, safety, and cleanliness. These systems also integrate digital technology and artificial intelligence which can be applied in the production, storage, transmission, and utilisation of energy. By monitoring, analysing, optimising, and scheduling energy in real-time, the smart energy systems can achieve efficiency, as well as emissions reduction. The smart energy system can enhance the role of natural gas in peak shaving, frequency regulation, and fluctuation compensation through unified dispatch. By applying simulation and digital twin technologies, smart energies can efficiently coordinate between thermal power and clean electricity. This addresses the randomness and volatility issues in clean energy generation caused by environmental and meteorological factors, effectively improving the utilization efficiency of renewable energy and enhancing the autonomous regulation capability of the energy system.

What emerging digital and intelligent technologies in the smart energy sector are worth extensively promoting and applying widely?

“Decarbonisation” is crucial to the ongoing sustainable development of the natural gas industry. As vital parts of climate change solutions, CCS and CCUS provide practical decarbonisation solutions for the traditional energy sector, enabling the continued production of essential energy while reducing emissions. Through repurposing captured carbon dioxide, CCUS can enhance the economic efficiency and sustainability of the energy industry. The potential for large-scale commercial deployment, accelerating the implementation and deployment of CCS and CCUS technologies is being explored.

How can CCS and CCUS technologies effectively play their important role in the current carbon reduction strategies of the natural gas industry?

Distributed Energy Resources (DER), or decentralized energy system, refers to a small-scale energy supply system that uses natural gas or other fuels to generate electricity and thermal energy close to end-user consumption, such as Combined Cooling, Heat and Power (CCHP). Gas-fired distributed energy resources can provide power, heat and cold energy for residential, commercial, and industrial applications, enhancing energy efficiency, reliability, and flexibility. In an era of energy transition, the major development for gas-fired distributed energy resources lies in multi-energy complementation. For example, burning mixed hydrogen enables new and existing gas turbines to transition from fossil to low-carbon energy sources, which has important implications for the future gas turbine market. Gas-fired power generation energy systems can achieve the coordinated application of various energy sources more efficiently by integrating user information with cloud computing and analysis, and an intelligent operation and management system.

Under the model of multi-energy collaboration and intelligent coupling, what are the commercial potentials for gas-fired distributed energy?

With the increase of supply capacity and demand, LNG has become an important international commodity. Buyers now have a variety of index choices like Henry Hub, National Balancing Point (NBP), Title Transfer Facility (TTF), and offshore assessments in the Asia Pacific such as Japan Korea Marker (JKM), which has enabled various new LNG pricing methods. When asked, “What is the global price for natural gas?”, the short answer is, “There is no unified global price.” Analyzing the problems in the existing pricing mechanism and moving forward with innovative recommendations for a global LNG trading model is key to better managing supply and demand and reducing fluctuations. Establishing a transparent global benchmark and futures prices requires the adoption of industry-standard LNG contracts.

What are the key elements and requirements in establishing a global LNG trading model?

ESG standards aim to measure the performance of organisations or companies in environmental, social, and governance aspects. In recent years, countries have introduced multiple ESG policies that continuously improve regulatory and disclosure frameworks. In the gas industry, ESG regulations and policies not only encourage companies to adopt stricter social responsibility and corporate governance standards, but also guide them to actively participate in carbon neutrality and greenhouse gas reduction efforts. ESG regulations and policies promote the transition toward cleaner, more environmentally friendly, and more sustainable operational practices.

Given current ESG requirements, what strategic decisions and corresponding operational practices should gas companies adopt for continued growth?

Inspired by the Silk Road of ancient China, a network of trade routes that connected China to the world, the Belt and Road Initiative (BRI) has fostered global collaboration across multiple sectors since 2013. As a focal point of BRI, the Belt and Road Energy Cooperation encourages the development and utilization of energy resources to improve energy accessibility, affordability and sustainability among countries along the route. The Belt and Road Energy Cooperation has achieved results in the oil and gas sector, including the establishment of bilateral and multilateral cooperation and the implementation of oil and gas pipeline construction projects.

What best practices have been implemented under the framework of the Belt and Road Energy Cooperation? How will all parties continue to promote common prosperity?

As technology matures and commercial extraction models improve, global natural gas production and supply capacity have continued to grow. Nevertheless, the industry maintains a cautious attitude towards investing in upstream natural gas exploration and development projects. These factors include the energy transition, complex global economic environment, and geopolitical tensions. When meeting energy demand, natural gas remains one of the cornerstones of the global energy mix. In the coming decades, more natural gas resources may still be needed to meet energy consumption demands. Investments today are the reserves of tomorrow and future production. Increasing natural gas supply capacity cannot be achieved overnight; it requires advanced planning, strategy and the formulation of future investments to ensure energy supply stability.

How can investments be increased to ensure supply security?

The natural gas market in the Americas is facing unprecedented growth and changes with the rapidly developing export market. Natural gas resources in this region are among the most important in the global natural gas supply and consumption market. This has a significant impact on global supply and demand and plays an important role in international markets. What scenarios will ensure the Americas maintains its leading position in the global natural gas market?

Natural gas power generation has several advantages, including flexible start and stop, high load adjustment rate, wide adjustment range, and produces half the carbon emissions of coal. Natural gas power is not only an excellent source for peaking and frequency regulation, but it can also achieve efficient, flexible voltage regulation and phase adjustment and it provides system reserve and black start capabilities. With the integration of renewable energy in high proportions into the grid, electrical systems need natural gas power to ensure a stable and reliable supply. By replacing coal-fired power, natural gas power generation also helps promote the transition of the electrical system towards a cleaner and low-carbon future. Looking ahead, natural gas power generation will be key to establishing a resilient, secure and decarbonized system.

How can we maximize the benefits of natural gas power generation in power systems?

A balanced, diverse and inclusive energy market respects different energy consumption needs across the globe and promotes the balanced utilization of various energy forms. It also allows countries, companies, and individuals to share the opportunities and benefits of energy development. Such a market is not merely a platform for resource allocation but an important guarantee for promoting social equity and sustainable development, serving as the cornerstone for global energy prosperity and stability.

What are the essential conditions and elements for building a balanced, diverse, and inclusive global energy market?

Natural gas demand and consumption in the Asia-Pacific is an important driving force for global gas development. As a clean and efficient energy source, it plays a key role in meeting the increasing energy demand of regional countries. Besides Central Asia, the Middle East and Australia are rich in natural gas resources and are important to global energy markets. Oil and gas resources in the Asia-Pacific are not only crucial to local economic development, but also global energy security and price stability. Market participants are exploring more efficient, economical, and environmentally friendly methods for continued growth.

Given the energy consumption and production in the Asia-Pacific, how does potential growth facilitate the further development of the global natural gas market?

LNG terminals are facilities that integrate the receiving, storage, regasification, and transshipment of liquefied natural gas. As the global LNG market enters a phase of growth, the number of LNG terminal projects under construction and in operation has increased significantly. In this context, optimising operating models and improving the integrated utilisation rate of terminal equipment and facilities is imperative to further expand the effectivity of LNG terminals. The development of LNG terminals will face challenges in the future such as refining business models, green transformation and upgrading, and key technological innovations.

What are the challenges for global LNG terminals?

Africa is the fastest-growing region in the world, with the youngest demographics, abundant natural gas resources, and a great potential for future development. It plays a vital role as an ideal choice in Africa’s energy consumption structure, meeting essential energy needs for both daily life and economic development while addressing environmental concerns. Africa's exploration and production industry is rapidly developing and has become a crucial component of the global supply arena. What opportunities exist for African producers and operators in local and global markets?

The stable delivery of natural gas to consumers relies on transmission and distribution pipelines, gas storage facilities, LNG receiving terminals, and peak shaving infrastructure. Ensuring energy supply security and stable economic growth requires continuous investment in these infrastructures. Various forms of financial support are necessary for continued investment in gas infrastructure projects. Supports include long-term loans from multilateral development banks and international financial institutions, funding and tax incentives from governments, and equity investments or debt financing from private investors. Innovative financial instruments such as blended finance and sustainable bonds can also provide necessary funds for related projects.

What are the essential financial mechanisms to support natural gas infrastructure development？

LNG shipbuilding and transportation are crucial components of the natural gas industry chain. With the rapid growth of the global LNG market, the number of newly built LNG carriers continues to rise, the transportation capacity is rapidly increasing, and the global shipping network is constantly improving. New low-carbon, efficient, and intelligent developments impose stricter requirements on operators in areas such as ship design and building, technology research and application, transport service solutions, and capacity resource allocation.

How can the global LNG shipping industry make low-carbon, efficient, and intelligent advancements?

Natural gas is the cleanest and lowest-carbon fossil fuel. The utilization of natural gas has advantages such as abundant resource reserves, well-developed infrastructure, convenient transportation and supply, and flexible utilization methods. Achieving climate goals and securing a reliable and affordable energy supply are equally imperative while taking into account diverse global economic development stages and energy demands. The role of natural gas in ensuring global energy security, addressing energy poverty and promoting economic development is invaluable. Additionally, natural gas is the ideal partner for renewable energy, enhancing the stability and reliability of renewable energy applications.

As a cornerstone fuel, what role will natural gas play in new energy systems?

Carbon pricing is important for reaching Net Zero carbon emissions reduction goals. Currently, carbon taxes and Emissions Trading Systems (ETS) are two main methods for pricing carbon. As these two methods mature, they work closely together to significantly influence the decarbonisation of the energy sector. Many governments are pursuing a comprehensive pricing mechanism.

What strategies should energy companies proactively adopt to gain a competitive edge under carbon pricing regulations?

Due to differences in the supply of natural gas and growing demand, cooperation between importers and exporters can maximize economic and energy benefits and promote energy security and market stability. To promote a balance between supply and demand and enable the sustainable development of the natural gas industry, where and with whom should importing and exporting countries deepen their cooperation?

Technological innovations and digital management allow gas distribution companies to eliminate or mitigate operational risks. As demand for natural gas continues to grow in urban areas, necessary measures need to be taken to ensure that transmission and distribution systems are safe and stable to avoid endangering lives and property.

How does technological innovation enable the safe distribution of urban gas?