“At Neptune my role is focused on three areas: decarbonisation of our operations, supporting Neptune’s ESG targets; Carbon Capture Usage and Storage (CCUS), a way to dual-purpose or repurpose our facilities and to create new business lines; and energy systems convergence i.e. new forms of energies that build on our skills and infrastructure.”
Girard outlines a future in which gas continues to have an important role for some time.
“We need a mix of energy sources, and hydrocarbons will continue to play a key role for many years to come. Gas has played a key role in reducing emissions in countries like the UK, where coal-fired power stations have been phased out and replaced by gas-fired efficient power stations.
“In Norway, we operate the Gjoa semi-submersible platform, which was electrified from the onset, saving 200,000 tonnes of CO2, annually, and we are pleased to be progressing the electrification of the Gudrun facilities.”
So the outlook is one of continuing change, with a role for gas but also for new technologies.
“Increased investments in renewables by O&G majors may be required by shareholders and investors in order for these companies to maintain their social licence to operate. In turn, this may put increased pressure on the supply chain, creating both opportunities and risks with possible associated cost increases. The intermittence of most renewable energy will also need to be addressed, with a continued role for gas and the possible growth of hydrogen as a solution, as well as further developments in battery technology.”
Of the various energy transition strategies outlined in this report, Neptune’s focus is on adopting climate-focused ESG considerations into its business models. For example, he sees a role for Neptune in carbon capture and storage.
“There is growing momentum to use CCS for hard-to-abate industries, and Neptune is well placed to play a key role, with studies to offer storage capacity at the L10 Hub in the Netherlands. We have applied for a CO2 storage licence in the UK and are keen to bring our experience and agile ways of working to offer value-for-money solutions and help the UK meet its goal on the journey to Net Zero.”
Neptune is also working on how to adapt its infrastructure for hydrogen.
“With our PosHYdon hydrogen project, we plan to progress feasibility studies to install an electrolyser on our operated Q13a-A platform and learn how to repurpose facilities to produce and transport hydrogen. We expect to see rapid changes in hydrogen technology. At this point we are technology agnostic and focus on bringing our expertise in safe offshore operations handling natural gas with the natural evolution to hydrogen.”
Based on the actions described above, Girard foresees an expansion in energy systems convergence, with increasing opportunities to combine hydrocarbon production with hydrogen from wind energy or with other forms of renewable such as geothermal.
“In 2020, Neptune Energy was in the top two in the industry for low CO2 intensity, according to Rystad [an energy consultancy], and we aim to maintain our low carbon intensity for operated assets at 6kg/boe in 2030. This will require significant investments that are likely to be facilitated by the introduction of new business lines for these assets.”
Neptune’s strategy has implications across the markets in which it operates. “We will continue to bring affordable gas to the Asian market, helping replace coal-fired power plants with gas-fired power plants.”
Finally, in terms of the challenges that the industry faces as the energy transition advances, Girard particularly highlights the need for clarity on CO2 pricing and how this will evolve over time, in order for companies to plan their investments accordingly.