Total Looks to Decarbonize Russian LNG

Russian LNG must be decarbonized if it wants a role in the energy transition, TotalEnergies CEO Patrick Pouyanne tells Energy Intelligence. The French major's increased focus on renewables doesn't mean it intends to scale back its Russian LNG expansion plans, but at "new projects, we need absolutely to consider that all CO2 emissions must be diminished to the minimum,” he said on the sidelines of the recent St. Petersburg International Economic Forum. Total is not the only Western major hoping to keep its hands on Russia's relatively low-cost oil and gas while repositioning for the transition. BP CEO Bernard Looney told the forum he sees scope for cooperation in low-carbon projects. Royal Dutch Shell said it will consider hydrogen production and carbon capture technologies at its upstream projects with Gazprom Neft, state-owned Gazprom's oil arm, and will buy renewable power from Finland's Fortum for its Russian operations. Total signed a memorandum of understanding with Russian partner Novatek in St. Petersburg to cut emissions and develop hydrogen and renewable power in the Arctic. The Russian independent plans to produce up to 70 million tons per year of LNG in the region by 2030, up from 18.8 million tons in 2020. The only plant now in production is Yamal LNG, in which Total has 20%. As well as a 19.4% stake in Novatek itself, the French firm owns 10% of Arctic LNG 2, whose three 6.6 million ton/yr trains are slated to start in 2023, 2024 and 2025 (WGI Jun.2'21). While in St. Petersburg, Total said it had also bought 10% of Novatek’s LNG transshipment terminals in Murmansk and Kamchatka, scheduled to open in 2022-23 to cut Arctic LNG's shipping costs. “We’re not scaling down [our Russian LNG business] at all,” Pouyanne said. Even though the EU is cracking down on gas, he said it will be needed in the global energy transition as an alternative to coal. He sees gas demand peaking in 2040, at the earliest. Still, the future of LNG is low carbon, which is why Total is looking into carbon capture and storage (CCS), hydrogen, ammonia and wind power generation in the Arctic. “There’s a lot of wind" in the Arctic, he said. “We’ve already put a pilot, we need to measure wind strength and seriously we think we can produce wind energy in order to bring some renewable power -- “green” power -- to the [LNG] plant, so it’s a way to save some CO2." Total and Novatek will make a decision on a wind project in the Yamal Peninsula at some stage in the future, he said. Novatek has already been looking into CCS at Yamal LNG and at gas fields feeding future projects. A final investment decision could potentially come next year, as could a decision on an ammonia project near Yamal LNG. This could replace the planned Obsky LNG, where Novatek is struggling to scale up its Arctic Cascade liquefaction technology. Novatek and Total see ammonia as a way to transport hydrogen, and are betting on growing interest in Asia. The Russian independent also wants to decarbonize its Cryogas Vysotsk, or Vysotsk LNG, project in northwest Russia. It signed a memorandum of understanding with Fortum in St. Petersburg to purchase “green” electricity for the 660,000 ton/yr plant, intended to supply Europe as well as shippers. It says the deal will help Novatek “offer its LNG customers a more sustainable product," with lower Scope 2 emissions associated with electricity purchases. Vitaly Sokolov, Moscow