Singapore has inked a deal with Qatar for the establishment of the first long-term liquefied natural gas (LNG) that details pollution from the fastest-growing fossil fuel.
A report by Al Jazeera said that Singapore-based Pavilion Energy Pte inked a 10-year agreement with Qatar Petroleum’s trading subsidiary for the LNG terminal that would produce as much as 1.8 million tons of fuel per year. It was expected to go operational by 2023.
Even if the fuel was much less polluting than oil and coal, the sector was under increasing pressure to reduce carbon emissions as nations were scrambling to meet their strict climate targets.
According to Pavilion, there was no obligation for carbon offsets but the intent was there to reduce emissions.
“In the context of energy transition toward a low-carbon economy, this partnership is testament to the sustainability drive of both companies and the strong willingness of Pavilion Energy to pursue decarbonization and offset strategies,” Pavilion Energy Chief Executive Officer (CEO) Frederic Barnaud was quoted as saying during the signing of the agreement.
For his part, Qatar Petroleum CEO Saad Al-Kaabi said that the deal was an achievement for the joint venture company
““This agreement reflects our commitment to respond to the needs of our customers, and to ensure supply security, price competitiveness and flexibility,” he was quoted as saying.
“[It] also constitutes an important step in reaffirming LNG’s critical economic and environmental factors and its strong role in the energy transition.”
Pavilion Energy opened the partnership bidding for the terminal in March. It said it expected to become a standard in the industry that has been lacking common and transparent practices of quantifying and disclosing emissions per cargo.
For Qatar which was seeking to expand its LNG footprint, the deal would make it a major supplier to Singapore’s growing market.
Al-Kaabi said that the project would be the first achievement of QP Trading, a unit set up to build a global LNG portfolio that includes both equity and third-party volumes.
QP Trading would be tasked to manage the price risk exposure of its portfolio through physical and derivatives trading, according to Qatar Petroleum in a statement.
The company hired Arnaud Dubois-Denis as global head of LNG trading to build operations for the gas giant.
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