IEnova Uses Carbon Offset to Meet Emission GoalsBy Cinthya Alaniz Salazar | Tue, 07/20/2021 - 10:19
After striking a deal with BP, Sempra Energy’s subsidiary IEnova in Mexico received its first carbon offset liquified natural gas (LNG) cargo at the Energy Costa Azul (ECA) facility on the Pacific Coast. The delivery follows a concerted effort from energy companies to reduce their carbon emissions, as the world enters an accelerated transition to clean energy.
According to BP quantification methodology, which it touts to have been developed following relevant international standards, the estimated carbon dioxide and methane emissions associated with LNG cargo would be offset by retiring the equivalent carbon credits from an afforestation project from BPs portfolio on behalf of Sempra LNG. Neither press release from the companies made clear if the transaction would render the cargo as carbon neutral. S&P reported that the companies did not respond to comment on the subject.
LNG, “the cleanest fossil fuel”, has become a point of interest for BP considering growing demand for the product, as it is increasingly seen as an alternative to coal and petroleum. It is also considered as a secure investment, given that natural gas is projected to account for 25 percent of worlds energy portfolio by 2035. Although it already stands at 21 percent, the four percent gap represents a potential demand of 5,1000 Gm³. With this in mind, BP is attempting to remain “one of the world’s leading and most innovative LNG suppliers” says Carol Howle, EVP of trading and shipping.
Respectively, Sempra and IEnova intend to continue supporting the growth of this sector “by diversifying their offerings, including developing bundled carbon offset LNG products.” In tandem, they are also building liquification facilities adjacent to their ECA facility with the aim to increase LNG export capacity by 12 Mtpa. More widely, it would also help Sempra LNG meet self-established goals of reducing GHG emissions by 20 percent by 2025 using 2020 as their baseline.
Sempra assures that ECA would continue to serve the needs of its customers, “including from the receipt of multiple LNG cargos each year pursuant to long-term sales and purchase agreement between bp and its partners in Tangguh LNG and Sempra LNG.”