Emma Cochrane
Vice President of Liquefied Natural Gas (LNG), ExxonMobil and Director and Chairwoman, ExxonMobil LNG
Market Development
Geo Board of Investment Conference
April 17, 2018
Riyadh, Saudi Arabia

Hello, I'm Emma Cochrane, Vice President of Liquefied Natural Gas (LNG) at ExxonMobil and Director and Chairwoman of ExxonMobil LNG Market Development.

It is a pleasure and an honor to be speaking to you today in my current role, especially in such an exciting period for ExxonMobil in Pakistan

The work that those in attendance today are undertaking is of extreme importance. Energy is fundamental to economic growth and human progress. In the future, we will need much more energy to support rising living standards and a growing middle class. We all want a good quality of life, a clean environment, a better future for our children.

One of the triumphs of the past quarter-century has been a dramatic increase in living standards. The UN estimates that, since 1990, a billion people have escaped extreme poverty. And every year, 160 million are joining the global middle class. Energy is a key driver in this economic success story; and while we're making progress, we know we're not finished yet, as about 1 billion people still lack access to electricity across the globe. Each person here is contributing to progress on this front.

By investing in fuel and power options that are cleaner, reliably available, and affordable, we enable people to change their lives for the better. As we heard this morning, the investment climate in Pakistan is primed for just this type of growth, and at ExxonMobil, we are in the business of being the global partner to fuel that growth.

In my current role, I lead our global liquefied natural gas business, serving over 30 countries, and helping market leaders manage the enormous challenge of supporting greatly increasing energy demand while ensuring that energy is affordable, and also environmentally sustainable. At ExxonMobil, we refer to this three-part challenge as the "energy trilemma".  Abundant supply, reliably accessible to all, delivered and consumed with sustainability in mind. This is why we believe natural gas is the energy source that has the greatest potential to increase hope and opportunity for billions – including future generations – around the world.

When I started with ExxonMobil, global LNG demand was under 50 million tons per year, and today, it has grown to over 300 million tons per year. It fills me with pride to be part of an organization that has consistently opened new markets for gas and for over 45 years reliably supplied liquefied natural gas, cleaner burning fuel with over 60 percent fewer greenhouse gas emissions than coal along with fewer emissions of NOx, SOx and lead. Now, of course, Pakistan has grown considerably since I started in the industry [even faster than LNG demand!], growing over 900% in real GDP [1985 GDP was $31G, $279G in 2016]. This growth and potential is one of the reasons that we believe it is so important to invest in Pakistan's future.

Because natural gas is abundant, versatile and cleaner-burning, we see it as increasingly the fuel of choice, growing even faster than total energy demand. As you can see, gas grows as a percent of primary energy demand in almost all regions. New projects will naturally be required to meet this demand.

Fortunately, at ExxonMobil, technology advancements continually underpin the expansion of available resources such as liquefied natural gas, which supplies one-third of natural gas demand growth to 2040. In this time, supplies will continue to grow and diversify, and ExxonMobil is active across the globe. 

Far from being in decline, ExxonMobil sees that less than 15 percent of recoverable natural gas resources have been produced, and remaining natural gas resources can provide more than 200 years of supply at current demand. This is why we are partnering with nations like Pakistan, and we are ready to fuel future growth and underpin economic advancement.

Partnerships will be key to building the projects needed to meet the world's future energy needs. On choosing energy partners, nations need partners with a long-term vision to take on the toughest challenges and provide solutions, develop markets and products, and unleash technology to its full potential. Most importantly, nations need partners that have proven they can deliver a step-change in a nation's energy development while safeguarding the environment.  We feel well positioned with our world-class workforce, technical expertise, project execution experience and proven global capabilities, and we’re eager to bring all of this to our partnership with Pakistan.

ExxonMobil's strong balance sheet provides a unique competitive advantage, including substantial flexibility to capture all attractive opportunities, and unmatched access to capital on the most attractive terms.

Recently, we have captured highest-quality acreage in 10+ years, with continued drilling planned each year. We are progressing multiple LNG projects toward final investment decisions, and preparing for growing production in PNG, Mozambique, Qatar, and the United States.

The LNG Business is a focus area of ExxonMobil's growth, as global trade grows staggeringly to about 600 MTA by 2040. There are a variety of global LNG development opportunities to meet this growing demand, but affordability is key; Wood Mackenzie sees an inventory of opportunities that exceed the needed supply, but have widely varying supply costs, that range to well above the cost of supply in ExxonMobil's inventory of opportunities. 

At ExxonMobil, we understand that cost competitiveness will be key to determining which energy projects will succeed. We are progressing a range of the most competitive opportunities to bring gas to market in time to reliably serve growing demands in places like Pakistan. Here you can see that ExxonMobil has aggressively added to its potential for new capacity to serve the market in the coming years.

Our history in here can be traced back to the 1900s when we delivered products to Karachi and in the 1950s explored for oil in Pakistan.

Our partnership produced the Pakistan Refinery Limited, the discovery of the Mari field, and the Esso Pakistan Fertilizer Company. [Optional: ExxonMobil's divestment of the global fertilizer business was a strategic decision made in a different era.] 

Now, ExxonMobil and Pakistan have our newest long-term opportunity. We applaud Pakistan for its efforts to progress a broad and balanced energy mix that balances the three dimensions of the energy challenge—affordability, access, and environmental safeguards. The current Pakistan government has already implemented helpful policies to enable the country to import LNG. The government has also made good progress bringing on new power generation facilities. Bringing LNG to Pakistan will help the country upgrade older inefficient liquid fueled power plants.

Our history in here can be traced back to the 1900s when we delivered products to Karachi and in the 1950s explored for oil in Pakistan.

Our partnership produced the Pakistan Refinery Limited, the discovery of the Mari field, and the Esso Pakistan Fertilizer Company. [Optional: ExxonMobil's divestment of the global fertilizer business was a strategic decision made in a different era.] 

Now, ExxonMobil and Pakistan have our newest long-term opportunity. We applaud Pakistan for its efforts to progress a broad and balanced energy mix that balances the three dimensions of the energy challenge—affordability, access, and environmental safeguards. The current Pakistan government has already implemented helpful policies to enable the country to import LNG. The government has also made good progress bringing on new power generation facilities. Bringing LNG to Pakistan will help the country upgrade older inefficient liquid fueled power plants.

At ExxonMobil, we are relentlessly focused on strong fundamentals, which we believe are abundant in Pakistan.

Pakistan is a very important market for ExxonMobil and we are eager to bring natural gas to power its strong projected growth.

ExxonMobil has signed a heads of agreement with Pakistani consortium Energas to support the development of Pakistan's third LNG import terminal, and first private company LNG terminal, and to bring up to 1 BCFD of new supplies of LNG to Pakistan.

The heads of agreement is an important milestone for the project, which will help meet the country's energy needs and drive economic growth by providing a reliable supply of cleaner-burning natural gas.

As Pakistan's economy continues to progress, the demand for energy will continue to surpass supply without significant investment in infrastructure. According to Pakistan Energy Outlook 2017, Pakistan's current natural gas production stands at approximately 4 BCFD with a demand of around 6 BCFD. Some forecasts cite latent demand as high as 8 BCFD.

The government of Pakistan has done great work to improve access to affordable energy, delivering more than 11GW of new build power generation and putting Pakistan on the global LNG map. Pakistan has overcome the initial barriers to successfully import LNG by commissioning two LNG (FSRU) terminals—a game-changer for the country.

Emma Cochrane

Loading