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ExxonMobil's Lee R. Raymond discusses critical role of LNG in meeting
North America's energy challenges
Posted: 18 December 2003
In his address to the LNG Ministerial Summit in Washington, D.C.,
ExxonMobil Chairman and CEO Lee R. Raymond outlined a number of
challenges to harnessing the full potential of LNG, calling for
consistent and complete policies that, when encouraging the use
of natural gas, must also address the need for additional gas supplies,
including LNG. Stating that most of the gas North America will consume
six years from now is not yet in production, Raymond emphasized
that economic development of diverse supplies is needed to meet
growing energy demand and to replace inevitable declines in existing
production.
Raymond said consumers need all the gas they can get from all possible
sources, referencing ExxonMobil's $12 billion project with Qatar
Petroleum to supply LNG to the United States for a 25-year period
and the company's long-term 1.2 bcfd LNG production activities in
Indonesia to supply Asia Pacific markets. "Consuming countries
need to recognize that they have an important role to play in facilitating
timely energy development," Raymond added. "They can do
this by creating reasonable regulatory regimes that will allow facilities
to be designed and built without undue delay or unnecessary cost
and relying on free competition and market solutions to meet future
demand."
Raymond asserted that countries can facilitate development by fostering
an environment conducive to large, long-term investments in the
infrastructure needed to meet growing demand in Asia Pacific, Europe,
and North America, along with provision of a stable legal framework,
predictable tax structure, sanctity of contracts, an impartial court
system, respect for intellectual property, elimination of duties,
transparency in procurement, and workforce security. "Working
together," Raymond said, "governments and national oil
companies can play a constructive part by encouraging and facilitating
the growth in capacity that will be crucial to satisfying the world's
demand for energy over the coming decades." From an environmental
standpoint, he noted, "The benefits of natural gas make it
attractive for both the manufacturing sector and for power generation
throughout the world."
In the U. S., Raymond said, "Government agencies at all levels
of governance must rise to the challenge and facilitate terminal
development," adding cooperative relationships between project
developers and local, state, and federal government entities are
prerequisite for the efficient permitting and approval of new LNG
infrastructure being pursued by ExxonMobil and other companies.
Acknowledging that LNG technology is new and potentially uncertain
to those outside of the industry, Raymond stressed, "Nothing
is more important to our industry than the safety and health of
our employees and the people with whom we come in contact in the
conduct of our business. We need to communicate that message to
the public, make clear our commitment to operating safely, and discuss
the management systems we have in place to ensure that the highest
standards are met."
In addition to operations integrity, Raymond recognized technology
as a critical component of LNG's successful future, particularly
in regard to the efficiencies and cost savings it continues to generate.
In conjunction with joint-venture partners, ExxonMobil's engineers
have helped build some of the world's largest LNG plants, including
two in Qatar, which will ship nearly 10 million tons of LNG per
year. Utilization of new gas technology has contributed to efficiency
gains in liquefaction, transportation, and regasification. Recent
advances in LNG ship size and terminal tank design have produced
cost savings of more than 30 percent since the late 1990s.
"We must work for a future in which the immediate development
of new resources and flexibility in fuel choices provide more balance
to the North American natural gas supply and demand equation,"
Raymond concluded. "With so much at stake, failure is not an
option."
For more information see www.exxonmobil.com
Posted by Richard Price,
Editor Pipeline Magazine
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