G20 Natural Gas Day successfully held in Beijing

By Li Yalan

x Li Fanrong, Vice

Administrator of China’s National Energy Administration gave the Welcome Speech for the High Level Forum and praised the event for its insights and effectiveness.

On June 29, 2016 the G20 Natural Gas Day, co-hosted by the National Energy Administration of China and the International Gas Union, was successfully held in Beijing. Beijing Gas Group Company Limited, jointly with China Gas Society and China Gas Association co-organised the event. Over 300 delegates including energy ministers from the G20 countries, international organizations, key industrial players, consulting and financial companies participated in the event.

Zhang Gaoli, Vice Premier of China and Dr Shamshad Akhtar, Under-Secretary-General of the United Nations, delivered the welcome speech on the Joint Opening Ceremony for G20 Energy Ministerial Meeting, G20 Conference on Energy Access and G20 Natural Gas Day. David Carroll, President of IGU,

Dr Fatih Birol, Executive Director of the International Energy Agency (IEA) and Li Fanrong, Vice Administrator of China’s National Energy Administration (NEA) all spoke in the opening session of the G20 Natural Gas Day which was followed by three panel sessions centring on the theme of ‘Natural Gas – Promoting Sustainable Development’.

The G20 Natural Gas Day had great significance to Asia and the global gas industry.

The event has clarified the role of natural gas in energy transition. Natural gas is not a transitional energy; rather, it is the fundamental fuel of the future energy mix. Natural gas is a clean and efficient fossil fuel. It has unique advantages including supply stability, technology viability and flexibility. In recent years, the improvement of exploration and extraction technology has significantly improved the production level of natural gas, thus bringing profound change to the structure of the world energy supply. Meanwhile, as a clean form of energy with great adaptability, the application of natural gas in power generation and transportation has also been rapidly expanded. Natural gas as an economic, secure and flexible energy source has a great development potential. Natural gas is a way leading to energy transition. Governments around the world should remove bias towards natural gas and launch more favourable policies to promote the development of natural gas to embrace the ‘golden era’ for natural gas.

David Carroll reported the results of the event to the G20 Energy Ministerial Meeting. The G20 Natural Gas Day sends a strong message to the world that natural gas is an accessible, affordable, economic, clean and

sustainable fuel that is the fundamental energy for our future energy mix.

Beijing as location of the G20 Natural Gas Day was a specially good one. Beijing has dedicated great efforts and made major achievements in converting from coal power to natural gas and on improving air quality. Last year, natural gas consumption in Beijing exceeded 14 bcm. Beijing ranks third in the world for gas consumption in a single city. It presents a strong case to the world that using natural gas can improve the environment. However, even with such a large consumption volume, Beijing still lags far behind the world average level for the ratio of natural gas in the primary energy mix. The rest of China’s cities has an even greater gap to reach the world average level. In China natural gas accounts for only 5.8% of the primary energy mix. Li Fanrong pointed out that the Chinese government has already taken active measures to increase the consumption of natural gas with the aim to control air pollution. By 2030, natural gas is expected to account for 15% of the primary energy mix. Natural gas has huge

room for further growth in Asia and the rest of the world. Clarifying the position of natural gas as a fundamental fuel has great importance in promoting the further development of both the Asian and world gas industry.

c Dr Fatih Birol, IEA

Executive Director, giving the morning session’s welcome speech on global gas markets in transition, said that governments and industry must must take action to ensure security of supplies in the coming decades.

x Li Yalan, Chairperson

of the Board of Directors, Beijing Gas Group, spoke on the need to make natural gas a fundamental energy in China.

z Pål Rasmussen, IGU

Secretary General, presented IGU’s Case Studies in Improving Urban Air Quality. Beijing has made great efforts to improve air quality and the topic is of key concern to governments and people the world over as city populations continue to rise.

While we see the major opportunities and potential for natural gas, we should not ignore the difficulties and challenges facing the industry. Li Fanrong highlighted at the event that the high cost of natural gas, in particular

in storage and transportation, affects the competitiveness of natural gas against traditional fossil fuels in markets far away from gas fields. With favourable policy support, renewable energy achieved rapid development. Technological breakthroughs in renewables could bring fundamental change to the current energy mix. Natural gas still faces double pressures. The market players should work together to reduce costs and improve the competitiveness of the natural gas industry.

This is the first time a Natural Gas Day has been held under the G20 framework. It is an important step forward to shape the role of natural gas in global energy governance. Li Fanrong praised both the G20 Natural Gas Day and the work undertaken by Beijing Gas Company Ltd. As he underlined, the “G20 Natural Gas Day is a great success. It is a highlevel, in-depth, effective global natural gas summit; an experts dialogue filled with wisdoms and observations”.

Li Yalan is Chairperson of the Board of Directors Beijing Gas Group Co., Ltd and IGU Regional Coordinator for Asia and Asia Pacific.

c Kim Rudd, Parliamentary

Secretary to the Minister of Natural Resources, Canada gave a governmental perspective to the panel focusing on how natural gas could be used to respond to climate change and clean air.