Martin was employed by BG Group plc and its predecessor companies, retiring after 30 years in February 2014 as Chief Operating Officer and a member of the board of directors.
In 2016, he co-founded Tellurian Investments with Charif Souki and the company, which is developing a 26 mtpa LNG export facility in Louisiana, USA, is currently involved in a reverse merger with NASDAQ listed Magellan Petroleum.
He holds a number of external roles as well including non-executive director of BUPA, based in the UK, non-executive director of CC Energy based in Athens, chairman of TPH International based in Houston, senior advisor for Miro Advisors based in Perth and a member of the Advisory Board of the Center on Global Energy Policy at Columbia University’s School of International and Public Affairs based in New York.
1. Where do you see opportunities for LNG demand to grow, given the current oversupply?
Many places around the globe. Natural gas presents a proven solution to regimes whose people are choking on the fumes of economic growth. China, India and newly industrializing powers in Southeast Asia cannot continue to burn more coal (and at the same time act as a responsible global citizen). China represents a tremendous example of how useful and competitive LNG can be – with the government lowering prices even slightly, Chinese demand has responded very positively, especially in the Northeast. This latent demand story exists in many places, we just need to unleash it. Low cost LNG will do just that. We are not worried about oversupply; it is short-lived and the market will begin to rebalance itself early in the next decade. Conventional fields -- such as Malampaya in the Philippines, where I started my career, Bongkot in Thailand, others in Indonesia, Malaysia, Indonesia and Trinidad – are running out of gas. The greater risk is underinvestment by the industry which could lead to scarcity and higher prices – a volatile situation that could actually stunt demand.
2. What will be the long-term role of natural gas in the energy mix?
Natural gas is the only proven means of achieving our emissions reduction goals in the near term. Referring to gas as a bridge does it a disservice - unlike wind and solar it is reliable. It is also abundant, clean and the perfect complement to help us achieve our renewable goals without sacrificing economic competitiveness. It is time to do away with the popular refrain that natural gas is a bridge and replace it with natural gas plus renewables is the best way forward.
3. How can innovation help natural gas companies remain competitive as we progress toward a low-carbon future?
The name of the game is low cost, low cost, low cost. We must continue to look for innovative ways to lower production, liquefaction and transportation costs – the market won’t tolerate anything short of a sea change in cost over the long-term. This is about a shift in mindset: projects must use tried and tested technology, standardization of design and equipment, and stop engineering once construction has begun – practices that have become commonplace in other industries. In shipping, innovation in technology has improved efficiency and reduced operating costs; however, the market is skittish about future charter demand so ship owners have taken on more risk in building fleets. We must get creative in how we look at transportation to ensure gas remains competitive.
4. How can the industry lower LNG plant costs and remain operationally viable?
Again, it’s about mindset. Not everything has to be customized and there is nothing wrong with using off the shelf equipment. Bigger is not necessarily better – in fact the industry has shown diseconomies of scale in recent years. Experience is the best teacher and, I always say, an LNG plant is not complex, it is just a big refrigerator. Let’s not overcomplicate it. On the subject of mindset, it’s about aligning incentives: we choose our vendors very carefully and once we have made a selection, we become partners in the costs and risks of the project, and work to resolve costs together. Both teams have to align on the same goals.
5. What are your thoughts on the SIEW 2016 theme “New Energy Realities”?
It is a perfect theme for where our industry needs to be focused, on reality. No longer can we sit back and rest upon our old paradigms, or get paralyzed by fear of the unknown. We are living in uncertain times and the reality is, the turbulence probably won’t lessen in the near future. However, this makes it a great time to be in the LNG industry. With innovation, foresight and courage, we should be investing in our future and ensuring we can supply the world with a sustainable, clean and abundant source of energy for decades to come.
About the SIEW 2016 theme “New Energy Realities”
The theme reflects the opportunities and challenges we face in the current environment of an excess supply of oil and gas. Oil prices have stayed down for a longer period than most had expected. This has discouraged new upstream investments, which would impact future supply. At the same time, the Paris Agreement following COP21 has given new impetus to the deployment of renewables. Technology progress has also continued to make energy production, systems and networks smarter, heralding new possibilities. Against this backdrop, SIEW 2016 will discuss how we can work together to navigate this period of change.