LONDON – Royal Dutch Shell PLC invested heavily in natural gas as the energy source of the future when it bought BG Group for $ 54 billion. Five years later, it looks like the gas era won’t last long.
Falling prices for wind and solar energy, coupled with new green targets from government and industry, are accelerating a shift to cleaner energy and leaving natural gas – long seen by energy companies as a bridge between fossil fuels and renewable energy sources. stitch. The fuel is also increasingly being screened for methane leaks, causing some potential customers to skip gas and switch to low-carbon alternatives.
That’s a risk to Shell and rivals such as Exxon Mobil Corp. and Total SE, which also invested in gas, as gas projects typically cost billions of dollars up front and take decades to recoup that investment.
Shell halved its outlook for global gas demand growth to 1% per year last month, saying demand for the fuel could peak as early as the 2030s.
While burning gas emits less greenhouse gas than coal, environmental benefits are lost when methane, the main constituent of natural gas, leaks away. Methane is more powerful than carbon dioxide to contribute to climate change and has become a target of environmentalists.