Gulf Coast. In the Gulf Coast Corridor, Shell plans to install a small-scale liquefaction unit (0.25 million tons per annum) at its Shell Geismar Chemicals facility in Geismar, Louisiana, in the United States. Once operational, this unit will supply LNG along the Mississippi River, the Intra-Coastal Waterway and to the offshore Gulf of Mexico and the onshore oil and gas exploration areas of Texas and Louisiana.

To service oil and gas and other industrial customers in Texas and Louisiana, Shell is expanding its existing relationship with fuels and lubricants re-seller Martin Energy Services, a wholly-owned subsidiary of Martin Resource Management Corporation (MRMC). MRMC and its publicly traded affiliate, Martin Midstream Partners L.P. will provide terminaling, storage, transportation and distribution of LNG.

LNG-powered Offshore Supply Vessels. Image courtesy of Harvey Gulf International Marine. Click to enlarge.

Shell has a memorandum of understanding with Edison Chouest Offshore companies (ECO) to supply LNG fuel to marine vessels that operate in the Gulf of Mexico and to provide what is anticipated to be the first LNG barging and bunkering operation in North America at Port Fourchon, Louisiana. The LNG transport barges will move the fuel from the Geismar production site to Port Fourchon where it will be bunkered into customer vessels.

Great Lakes. In the Great Lakes Corridor, Shell plans to install a small-scale liquefaction unit (0.25 million tons per annum) at its Shell Sarnia Manufacturing Centre in Sarnia, Ontario, Canada. Once operational, this project will supply LNG fuel to all five Great Lakes, their bordering US states and Canadian provinces and the St. Lawrence Seaway. The Interlake Steamship Company is expected to be the first marine customer in this region, as it begins the conversion of its vessels.

Shell’s own use of LNG. Shell is also working to use LNG as a fuel in its own operations or to support its operations.

Shell has chartered three dual-fuel offshore support vessels (STX SV310DF) from Harvey Gulf International Marine utilizing Wärtsilä engine and LNG system technology. These vessels will be used to support Shell’s operations in the US Gulf of Mexico.

Shell has also begun to transition many of its onshore drilling rigs and hydraulic fracturing spreads to LNG. These conversions can reduce fuel costs and local emissions.

The new Mountains scenario: gas as the energy backbone. Shell last week released its latest scenarios exploring explore two possible ways the 21^st century could unfold, with dramatically different implications for society and the world’s energy system. (Shell famously has been developing and publishing scenarios to explore the future since the early 1970s.)

The latest iteration—the New Lens Scenarios—offers two: “Mountains” and “Oceans”.

• Mountains. The Mountains scenario sees a strong role for government and the introduction of firm and far-reaching policy measures. These help to develop more compact cities and transform the global transport network.

  The story of energy in Mountains is the story of the rise of natural gas. New policies unlock plentiful natural gas resources—making it the largest global energy source by the 2030s—and accelerate carbon capture and storage technology, supporting a cleaner energy system.

  In the first decade of the 21^st century, exploration success and technology advances have more than doubled the recoverable gas resource base. In the scenario, The eight countries that accounted for 60% of global gas production in 2012 continue to increase their share for the next three decades. However, the emergence of new resources creates a new world order of gas producers.

  The previously anticipated decline of North American gas production is reversed and China joins the top tier of producers, allowing both of these major energy consumers to reduce their demand for coal and ultimately oil.

  A profound shift in the transportation sector sees global demand for oil peaking in about 2035. By the end of the century, cars and trucks powered by electricity and hydrogen could dominate the road. Technology to capture carbon dioxide emissions from power stations, refineries and other industrial installations becomes widely used, helping to reduce CO₂ emissions from the power sector to zero by 2060. Another factor in the scenario is the growth of nuclear power in global electricity generation. Its market share increases by around 25% in the period to 2060.

• Oceans. The second scenario describes a more prosperous and volatile world. Energy demand surges, due to strong economic growth. Power is more widely distributed and governments take longer to agree major decisions. Market forces rather than policies shape the energy system: oil and coal remain part of the energy mix but renewable energy also grows. By the 2060s solar becomes the world’s largest energy source.

Without strong support from policymakers, carbon capture and storage catches on slowly. By mid-century CCS captures only about 10% of emissions, growing to about 25% in 2075. This slow uptake is the main reason electricity generation becomes carbon-neutral some 30 years later in the Oceans scenario than in the Mountains scenario.

Higher energy prices encourage the development of hard-to-reach oil resources, as well as the expansion of biofuel production. Oil demand continues to grow through the 20s and 30s, reaching a plateau after 2040. Liquid fuels still account for about 70% of road passenger travel by mid-century.

High prices also spur strong efficiency gains and the development of solar power. By 2070, solar photovoltaic panels become the world’s largest primary source of energy. Wind energy expands at a slower pace, due to public opposition to large installations of wind turbines.

Elevated demand for coal and oil, a lack of support for CCS and less natural gas development outside of North America contributes to about 25% higher total greenhouse gas emissions than in the Mountains scenario.

Both scenarios see global emissions of carbon dioxide dropping to near zero by 2100. Under the Mountains scenario, greenhouse gas emissions begin to fall after 2030. Nevertheless, emissions remain on a trajectory to overshoot the target of limiting global temperatures rise to 2 degrees Celsius.

Although the Oceans scenario sees a dramatic increase in solar power, it also envisions greater fossil fuel use and higher total CO₂ emissions over the century than the Mountains scenario.

Shell said that the scenarios highlight areas of public policy likely to have the greatest influence on the development of cleaner fuels and renewables, improvements in energy efficiency and on moderating greenhouse gas emissions. They include:

• Measures to promote the development of compact, energy-efficient cities, particularly in Asia and other rapidly urbanizing parts of the world.

• Mandates for greater efficiency in areas such as transportation and buildings.

• Policies to encourage the safe development of the world’s abundant supply of natural gas—and to promote its wider use in power generation, transport and other areas.

• A price on CO₂ emissions and other incentives to speed the adoption of technologies to manage emissions, particularly carbon capture and storage (CCS).