The future of hydrogen production through steam methane reforming
“Energy security” is not a weak platitude or a PR term coined by the oil and gas industry to position hydrocarbon production as a legitimate business endeavour. It’s a very real issue, and one that is starkly in the spotlight as a new energy crisis takes hold.
The reality is that we will pay the price – economically and environmentally – if we cannot secure our own domestic energy supply, and that’s the essence of the British Energy Security Strategy announced this week by the UK Government.
With COP26 fresh in our memories and following the IPCC’s most recent report stating that it’s ‘now or never’ for climate action, the imperative for collective, bold steps in order to protect our world is critical. There is no disputing this fact.
But energy security and climate action need not be a binary choice.
As the world ramps up its investment in the renewable and low carbon energies that will power society in the future, we must be able to plug the supply gap and reduce our reliance on imports – imports which present a security challenge, as much as an environmental and an economic one.
Energy security means affordability. It means being able to light our hospitals, power or fuel our cars, and warm our homes. It means reliability and resilience and, crucially, it means not having to choose between heating or eating.
In the immediate, medium and longer term, we have four distinct opportunities to better ensure affordable and responsible energy security:
The simple economics of supply and demand have sent commodity prices soaring. We need the taps which are already turned on to operate as efficiently and with as little carbon impact as possible.
There are steps we can take today, almost immediately, to drive a reduction in carbon emissions while simultaneously improving the efficiency and reliability of production. That’s a win-win-win. More energy, better economics, less carbon.
Integrating alternative energy supply, improving the energy efficiency of the asset itself, optimising operations, tackling fugitive emissions through asset integrity, and reducing flaring. Leveraging smart maintenance technologies, implementing digital innovations, and applying decades of decarbonisation expertise means that this isn’t ideological thinking – they are practical solutions that can make a difference today.
Maximising potential today and tomorrow
As much as we need existing production to run better and smoother than ever before, we also need to maximise the potential of existing infrastructure to make it run longer.
The strategy highlights that “maximising North Sea production” is an important lever in ensuring energy independence, as well as setting out that “producing gas in the UK has a lower carbon footprint than imported from abroad”, and so we need to recognise the important role this domestic production will play in the our shared quest for energy security and transition.
The North Sea Transition Authority advises there are more than 300 oil and gas “small pools” in the UK North Sea. With higher commodity prices, small pools which were previously determined uneconomical, now stack up.
With a stronger economics case, sanctioning these opportunities for development means we can increase the potential of existing assets by hooking up additional wells. That will reduce the environmental impact by avoiding the construction of new facilities, while boosting production and securing supply. Again: win-win-win.
Enabling future-ready energy
The increasingly polarising debate regarding new oil and gas developments endures. Irrefutably, our world cannot afford new oil and gas developments that don’t have bullet-proof climate mitigation measures embedded from the outset.
But, even by the most ambitious measures, oil and gas will feature as part of an integrated energy future for decades to come. Knowing this means we have a moral and ethical duty to ensure our future energies are developed with a carbon neutral, or even carbon negative, impact.
But what does this mean? It means electrification ready. It means carbon capture technology. It means minimum-manned assets and it means the most efficient and optimised operations our industry has ever seen.
The good news is that we have these tools in our armoury. We have the expertise, motivation and ambition to make it a reality; to make homegrown, net-zero energy security possible.
A pragmatic and sustainable way forward
So, again, there doesn’t have to be a trade-off between energy security and climate action.
The new Energy Security strategy shows that both are possible, indeed key to delivering a lower-carbon energy system that can support people all across the UK.
I applaud the renewed focus on offshore wind – as an island nation, the UK has access to enviable wind and tidal resources. As we expand into deeper water through floating developments, I’m confident we also have a skilled and experienced offshore workforce that can cement the UK’s position at the very front of this industry.
The fresh commitments around hydrogen are also fantastic news for our industry – if carbon drove the industrial revolution, then hydrogen will underpin the low-carbon revolution we need as we continue on the long road to net zero.
Most importantly, I welcomed the clear signal the government provided that, in line with the goals set out in the North Sea Transition Deal, there is an enduring role for responsible hydrocarbon production activity.
The opportunity for all of us lies in delivering conventional energy as cleanly and efficiently as possible while we chart this path to newer, cleaner sources on an industrial scale. This is a necessary compromise, not a cop-out, and will help deliver a world where the energy trifecta is a reality not an aspiration.