Natural Gas: Younghoon David Kim, Co-chair World Energy Congress
Mr. Younghoon David Kim, co-chair of the Organizing Committee of the 22nd World Energy Congress and chairman of the Daesung Group took the time for a round of Q&A's with Susan Sakmar on behalf of Natural Gas Europe.
The World Energy Congress (WEC) is one of the premier events for the energy sector and always offers critical insights into the most pressing energy issues of the day. From your perspective as the Co-Chair of the 2013 WEC and as head of one of the largest gas distributors in Korea, what are some of the opportunities and challenges you see facing the energy world in the coming decade?
The world is going through an extraordinary period where the global energy landscape is experiencing a major transformation. This means changes in both the distribution and consumption of energy and dramatic shifts in supply and demand. These trends will have a profound impact on what the World Energy Council calls the Energy Trilemma: how to secure global energy supplies and ensure social equity and energy access while mitigating environmental damage. We are particularly interested in these issues in Asia, which is the world’s largest and most dynamic energy market. So we are looking forward to discussing at the Congress whether shale gas will prove to be a game changer, for example, and if the prospect of abundant fossil fuels will reduce demand for renewables and nuclear power.
How do these opportunities and challenges tie in to this year’s theme “Securing Tomorrow’s Energy Today?”
“Securing Tomorrow’s Energy Today” should not be misunderstood as implying that the world is facing a period of energy scarcity. Rather, the opposite is true. It seems that we are entering an age of energy abundance. This is largely due to the development of unconventional energy resources, such as shale gas. So the theme is meant to address the choices we need to make today in determining the right energy mix for tomorrow that would best meet the demands of the energy trilemma.
What role do you see for natural gas in the 21st century and how does natural gas fit into WEC’s mission, which is “To promote the sustainable supply and use of energy for the greatest benefit of all people?"
It has been said that we are entering the Golden Age of Gas and I believe natural gas will play a crucial role in curbing carbon emissions while at the same time meeting the world’s energy needs. With energy demand set to increase as the global population continues to rise, satisfying that demand in a sustainable manner will be a continuing challenge. The advantages of natural gas will come to the fore as a result, being cleaner than coal or oil while being more dependable than renewables in providing energy generation.
Much of Asia is dependent on energy imports with Japan being the world’s largest importer of liquefied natural gas (LNG), followed by Korea. What role do you see for natural gas and LNG going forward for Asia as a region and Korea in particular?
The demand for natural gas and LNG in Asia will grow due to a combination of reasons. One, of course, is that the development of shale gas in North America frees up supplies of U.S. and Canadian LNG for Asia. This will likely lead, in turn, to lower LNG prices, particularly if they are delinked from oil prices with the development of spot markets instead of long-term contracts. There are also increasing LNG supplies in Asia, such as those coming from Australia and Indonesia, while China has shale gas reserves as large as those of the U.S. and Canada combined, although whether they can be fully exploitable remains open to question.
One of the most closely watched developments in the LNG world are the prospects for LNG exports from North America, with both Canada and the United States in the race to export LNG to Asia. How significant a development is this and what are the potential impacts for Asia?
While the prospects of increased LNG exports from the U.S. and Canada are significant, the key question is whether Asia can take full advantage of this opportunity. Aside from Korea, Japan and Taiwan, which already have extensive LNG infrastructures because of their large LNG imports, the rest of Asia does not have the natural gas infrastructure that matches that of North America or Europe. So Asia needs to expand its networks of pipelines and LNG terminals.
As a result of the shale gas “revolution” that has swept through the United States, many countries are now looking at shale gas as a potential resource with a wide range of opportunities and challenges yet to be explored. Is shale gas on the agenda at WEC?
This will definitely be a highlight of the Congress discussions, with several sessions devoted to this topic.
Susan L. Sakmar is currently a visiting assistant law professor at the University of Houston Law Center and an expert on global gas markets, including LNG and global shale gas development. She is the author of the latest book on LNG, “Energy for the 21st Century: Opportunities and Challenges for LNG,”which is available direct from the publisher at http://www.e-elgar.co.uk/bookentry_main.lasso?id=14131 or from Amazon at http://www.amazon.com/dp/1849804214/ref=rdr_ext_tmb.