Cheniere, one of the leading U.S. LNG companies, announced its first “carbon neutral shipment” to Europe this week after a tanker left Cheniere’s Sabine Pass export terminal in Louisiana and travelled across the Atlantic to supply Shell as part of the two companies’ long-term LNG contract.

Unlike a standard LNG cargo, Cheniere’s “carbon neutral” shipment was made possible as a result of purchasing Shell’s carbon offsets from its nature-based portfolio. The calculated greenhouse gas emissions from Cheniere’s cargo – considering the entire LNG value chain – were traded with Shell’s extra “carbon credits” – a result of the company’s investments in natural solutions to capture CO2.

This announcement shows Cheniere’s innovative approach of putting the U.S. natural gas industry in a solid position to lead the way through the energy transition.

Carbon neutrality is not a single road 

Achieving carbon neutrality entails adopting diverse emission reduction solutions that can target specific industry concerns and are activated simultaneously to a company’s strength. For example, the industry has shown great interest in advancing Carbon Capture and Storage (CCS) technologies, a field where it has a natural advantage from both technical and capital standpoints.

Some of the industry’s latest investments in low-carbon technologies include:

  • ExxonMobil’s $3 billion investment in low-carbon CCS efforts.
  • Chevron’s launch of a $300 million fund to invest in low-carbon technology, while also partnering with Microsoft and Schlumberger to build a CCS plant in California.
  • Occidental’s announcement of the company’s first “carbon-neutral” petroleum shipment by offsetting it through CCS. Furthermore, the company is heavily investing in air carbon removal technology.

As EID has reported previously, according to a study by Columbia University, the continued improvements to gas leak detection and repair, as well as retrofitting natural gas infrastructure to transport hydrogen and other low carbon gases are also playing critical roles in reducing emissions.

An innovative approach to carbon neutral

Cheniere and Shell’s project also reflects the avant-garde vision when it comes to reducing the industry’s carbon footprint. Nature-based solutions (NbS) are considered a non-conventional CO2 emission reduction approach, consisting of projects aimed to protect, transform, and restore carbon-capturing ecosystems to address climate concerns.

While there is not a clear consensus on the definition and scope of NbS, projects may include restoring degraded agricultural areas, forests, grasslands and wetlands.

Nonetheless, the potential for NbS as an emissions reduction strategy is noteworthy. According to a study by the Proceedings of the National Academy of Sciences of the United States (PNAS), NbS could mitigate one-third of the projected CO2 reductions required per year between now and 2030. For context, this would more than offset the entire annual CO2 emissions from the global transport sector.

The fact that the industry is investing in these solutions as part of its climate and carbon-neutral portfolios demonstrates a willingness to actively contribute to emission reduction solutions without compromising energy affordability and reliability.