Globally, and especially in the U.S., Oil & Gas companies are working towards building more diversified, resilient, and low-carbon portfolios. This move stems from various factors such as meeting the growing energy demands driven by data centers and other energy-intensive applications and striving to achieve net-zero targets.

In this transition, LNG will play a key role for many reasons. First and foremost, the U.S. enjoys vast natural gas reserves, particularly from shale, which positions it as one of the world’s leading LNG exporters. Exporting LNG strengthens energy security, creates economic growth, and helps reduce trade deficits. The advances in hydraulic fracturing and horizontal drilling have unlocked large quantities of natural gas in the U.S., boosting domestic supply. There is a huge potential for integrating Carbon Capture, Utilization & Storage (CCUS) technologies with LNG to make it a lower-carbon option for the long term. Additionally, the availability of LNG helps stabilize domestic energy prices by balancing demand spikes, particularly in the winter when heating needs rise. For this and many other reasons, LNG is catching increasing attention, and the trend will continue for quite some time. 

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It’s not just LNG. It’s ‘low carbon’ LNG

With due acknowledgment given to all other benefits and strategic advantages, what makes LNG most promising is the possibility of it being ‘low-carbon.’ While we briefly touched upon integrating carbon capture, which makes LNG production carbon-light, reducing the carbon footprint of LNG heavily depends on how the facility is built, operated, and maintained. Inefficiencies on these fronts can significantly negate the possible benefits of the other technologies deployed. 

In this post, we will discuss how aspects of day-to-day asset management and maintenance can make or break the promise of ‘low carbon LNG.’ 

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An ‘Asset’ Is An Asset Only If you Know It Exists

It's not unusual to encounter facilities where the on-ground and on-cloud asset data is incomplete. In our experience, some companies have only 30% of their physical assets listed in the ERP system. While the company may still operate normally, it's far from optimal. Incomplete asset data results in frequent breakdowns, stock shortages, an overworked maintenance team unable to focus where necessary, and other issues.

We also see companies ordering and stocking spares for assets that do not exist, while other existing assets do not receive the required maintenance and spares on time due to missing, inaccurate, and outdated asset data.

If the asset data is not in place, the facility will underperform on all its KPIs from day one. Such gaps can easily hamper the production of low-carbon LNG and can offset the impact of other efforts in this direction. 

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Supply Chain: Binding or Enabling?

As Oil & Gas companies' portfolios become complex, so do their supply chains. Any LNG facility will have a complex supply chain. Factors like the push for just-in-time, minimizing inventory costs, avoiding dependencies, etc., are already pushing companies to optimize their supply chains. Low-carbon LNG also demands a supply chain that offers a minimum carbon footprint by supporting seamless and uninterrupted facility operations. 

LNG companies require highly accurate and reliable materials data to achieve perfection in their supply chain. Often, projects are initiated and commissioned without proper buying descriptions, leading to challenges in promptly procuring the correct spares. This issue prevents companies from building an optimized and diversified supply chain.

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Maintenance: Boon Or Curse? 

It's important to have the right maintenance strategy for every asset. Overmaintenance increases costs and environmental impact, while undermaintenance can lead to premature asset failure. Early failure of capital equipment can impact cash flows and the facility's carbon footprint.

Proper maintenance data for every asset is essential to the maintenance strategy. The strategy should consider the equipment's specific needs as well as the facility's overall priorities and objectives. Often, this aspect is overlooked, and maintenance can become a liability.

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Summary 

A comprehensive approach is essential to reducing carbon emissions from LNG production. Optimizing daily operations and maintenance is crucial, and accurate asset and maintenance data are fundamental for these activities. As LNG companies strive to minimize their carbon footprint, it's important to invest in establishing robust asset data and practices for operations and maintenance.

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