There is always so much interesting stuff in the @bp_plc energy outlook. Some thoughts on my main take-aways for natural gas. 🧵…
At first glance, on slide 5, natural gas looks good: it overtakes coal by 2025 and oil by 2035; renewables surpass it in 2040, but even in 2050, gas is the largest fossil fuel. This supports the thesis that gas will do relatively better in the transition.
But these are percentages. In total consumption, gas defends its position in a rapid transition—growing a bit, then declining a bit. But in a "net zero" world, gas demand is near its peak already. By 2050, consumption is down by a third.
That "net zero" outlook, however, hinges on carbon capture utilization and storage and/or hydrogen. More than a third of gas used in 2050 is for hydrogen; around 3/4 of gas used is carbon abated in one way or another.
The change in how gas is being used is made clear in this chart too—in systems with very high renewables penetration there is a shrinking, not a growing role, for gas.
There has always been this assumption in the gas industry that gas is most “energy-transition-proof” investment it could make. That’s still true. But between the “rapid transition” and the “net zero” world is a shrinking market eventually. (But one that still needs investment.)
It is also a market where gas must become more expensive—in order for the carbon dioxide to be abated. Gas, which has struggled to compete on a cost basis in the last decade, now needs to become more expensive to survive. That's a tough proposition.
All the more reason to tune in when Spencer Dale comes (virtually) to @CSISEnergy to discuss the outlook with @sladislaw. Sign up here 👇 (fin).…

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More from @ntsafos

11 Sep
The idea that the current tensions in the East Med are due to “decades-old” disputes isn’t entirely right. I am not sure people appreciate how much the Turkey-Libya delimitation created new realities and claims. Let's look at some maps.
My go-to source is always @CErciyes—his slides are excellent and make clear the Turkish position (I’ve added some links at the end of this thread). There is also a certain rhythm to his presentations, which makes them easier to compare over time.
Here is a map from May 2019, before the Turkey-Libya delimitation, showing Turkey’s claimed Continental Shelf. It uses the Turkey-Egypt midpoint and assumes that Kastellorizo has no or reduced effect. It reaches the 28º meridian, and then the firm line becomes a dotted line.
Read 12 tweets
19 Aug
So many bad takes on what is going in the East Med, what countries are fighting over, and how energy fits in. The narrative “tensions over energy” is neat, simple—and mostly wrong. Let's break it down.
There are two conflicts: one over Cyprus, the other over the role of islands in determining maritime boundaries, continental shelves, exclusive economic zones (EEZ), etc. And each conflict subsumes several sub-conflicts.
First, Cyprus. Turkey is frustrated by the Republic of Cyprus’ (RoC) hydrocarbon activities; it disputes the right of the RoC to declare EEZs, to issue licenses, to exploit resources, to spend the revenue, etc. This dispute has nothing to do with sea boundaries.
Read 21 tweets
29 Jul
Every week, there are a few stories on my timeline about Greece, Turkey and energy in the East Med. They tend to say the same thing; I mostly gloss over them. But there are three things that drive me nuts in how people talk about this issue. Pardon the rant.
First, I wish people would stop saying that Turkey is “exploring.” Exploring implies a target, some, you know, exploring and, eventually, results. Turkey isn’t *really* sending ships where it might find hydrocarbons—and I never hear of any actual results (are there?).
Now, Turkey is pretending to explore, of course—mostly to annoy, I think. But that’s like saying someone is “working out” because they follow some fitness accounts on Instagram and bought fancy clothes and new shoes. Put “exploring” in quotes, please.
Read 8 tweets
9 Jan
I guess, there is always space for another “Why are you closing your nuclear reactors Germany” story to rehash the same old points… It is unfortunate that angle gets that much airtime.

Here is what I wish we highlighted about the Energiewende. 👇…
1/ GHG emissions per capita were 80 percent higher in the United States than in Germany in 2017 – which is a polite way to say that the United States has a lot of work to do merely to be able to see Germany eye-to-eye on carbon footprint. That's a good place to start.
2/ Will Germany miss its 2020 targets? Yes, but only by a bit. In fact, in 2019, there was a sharp drop in coal production, bringing Germany much closer to its 2020 target.…
Read 13 tweets

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