The International Group of Liquefied Natural Gas Importers (GIIGNL) announced the launch of a comprehensive framework for a consistent industry approach to declaring greenhouse gas neutral LNG cargoes, at a time when the practice of declaring LNG cargoes ‘carbon neutral’ is increasing.
The Monitoring, Reporting, and Verification (MRV) and GHG (Greenhouse Gas) Neutral Framework is part of a collective industry movement to account for and reduce GHG emissions associated with LNG, an increasingly important source of energy worldwide. Entities at every stage of the LNG life cycle can use it to assess the GHG footprints of their LNG cargoes.
The Framework promotes verified and consistent quantification of GHG emissions across the entire value chain, from extraction of natural gas, liquefaction, shipping, regasification to final consumption. Significantly, it creates a transparent practice to declare GHG neutral cargoes through an independently verified Cargo Statement which sets out both emissions and offsets.
GIIGNL promotes that emissions are avoided and reduced where possible, and if offsetting is used, it can compensate for residual emissions that cannot otherwise be reduced or avoided.
“To fulfil the LNG industry’s critical and unique role in supporting the global economy to transition to net-zero emissions, it is imperative that our sector consistently and collaboratively accounts for emissions across the entire value chain,” said President of GIIGNL, Jean Abiteboul.
“Alongside reducing and offsetting overall emissions, it is our intention that the Framework assists the industry in demonstrating greater transparency.”
Steve Hill, Executive Vice President, Shell Energy and GIIGNL Regional Vice President for Americas added: “The Framework provides organisations across the industry with a best-practice approach specifically designed to enhance transparency and accuracy in quantifying, reporting, and offsetting emissions associated with LNG cargoes. We are keen to start the groundwork on applying this framework to deliver a test “GHG neutral” LNG cargo as defined by the Framework.”
Michiaki Hirose, Chairperson of Tokyo Gas and GIIGNL Regional Vice President for Asia pointed out that “while corporate strategies to reach GHG neutrality may differ from one company to another, the industry expects to achieve GHG reductions throughout the LNG value chain.”
Dan Brouillette, President of Sempra Infrastructure and member of the GIIGNL Executive Committee explained: “The tools and pathways provided within the Framework will help LNG organisations create clear and reliable GHG emissions reporting that can be independently verified, supporting them to make good on their climate commitments.”
“We encourage the industry to begin using the Framework from now on but we understand that alignment will take time as industry participants build necessary resources and capabilities. We look forward to working with all stakeholders so that the global community has the best chance of reaching net-zero climate goals,” President Abiteboul concluded.
GIIGNL recognises the importance of reducing methane emissions and the Framework requires that they are reported separately in the Cargo Statement, alongside all seven Kyoto Protocol GHGs.
Use of the term “GHG Neutral” represents a full life cycle footprint across the entire cargo value chain, based as much as possible on primary data, supported by a long-term decarbonisation commitment, a delivered emission reduction plan and fully netted with high quality offsets.
The Framework does not seek to replace any established standards and methodologies for GHG emissions calculation, footprint determination and offsetting. It integrates established internationally agreed standards and methodologies and provides additional criteria for assessing and reporting GHG emissions associated with the specific case of an LNG cargo.