Natural gas is very much “at the centre” of the move to a lower-carbon world, technology pioneer Baker Hughes’ chairman and CEO, Lorenzo Simonelli, said at LNG2026.
Simonelli argued that energy security is key, noting that “when you look at the abundance of natural gas around the world, [it] is really not a transition fuel. It is a destination fuel.”
“It’s thanks to natural gas that we’ll be able to go towards a lower-carbon economy. You’ve seen that happen in the US, and you’ve seen that happen in Europe, where already today a lot of natural gas is utilised. But elsewhere in the world, as part of the energy mix gas is still relatively small,” Simonelli observed at a panel titled ‘LNG: A Critical Enabler for a Lower-Carbon Future’.
Flexibility and versatility
The Baker Hughes leader talked up the global importance of the optionality that LNG provides. “When you think about natural gas outside of a pipeline, the best way to have natural gas is through LNG,” he said. Consumption and supply are not always in the same place, so it’s important to continue to build out LNG infrastructure, Simonelli noted. “And I would say that, over the last 15 years, the growth has been significant, and we don’t see that stopping. What’s good about an event like this is that we can tackle the questions around the fear of oversupply, which we think are exaggerated,” he added.
Simonelli said the world must realise the truth that energy demand is increasing—for example, with the rise of AI and datacentres—even in mature economies, where it was thought consumption patterns would slow and plateau, and across the developing world, where he argued it is only fair for everybody to share in economic development. Natural gas and LNG underpin both these elements.
“If we’re going to do the same things the way we did them before, we’re likely going to lead to brownouts,” Simonelli warned, citing the example of Houston, Texas where he lives, and the crucial need to keep building infrastructure to keep up with demand. “Many in this room, like I, would have felt that Houston doesn’t suffer blackouts; well, I can tell you that Houston suffers blackouts more than I thought,” he quipped.
Simonelli’s anecdote came with a serious message: the infrastructure is fragile, but that’s not because of a lack of investment but due to the scale of demand. “We need a resilient infrastructure going forward,” he concluded, stressing the critical role of working together in partnership and providing a consistent and collective voice, given that many outside the industry don’t really understand how energy is produced.
Liz Westcott, acting CEO of Woodside Energy, a top Australian energy company, highlighted the important role Asia will play in gas demand as well as LNG’s versatility and its ability to support renewables and the “the massive decarbonisation goals by displacing some of the really high intensity fuel uses such as coal and oil”.
Westcott contrasted Simonelli’s Houston example with that of Australia, where extreme heat recently put the electricity grid under pressure in some states that rely on a lot on renewable energy. “Without traditional energy such as natural gas, those states probably experience a blackout that day,” she warned, referring to a key Australia holiday in late January that caused the spike in energy use.
“It really just underpins the role natural gas can play, even in very established renewable volumes on backfilling and being flexible when needed,” Westcott said.
Yukio Kani, global CEO and chair of JERA, warned that volatility is increasing and that LNG, with its reliability and affordability is the only practical solution.
From a buyer side and as leader of a key Japanese power company, Kani emphasised the importance of diversifying sources to respond to seasonality in the near term but also long-term consumption patterns.
Addition not transition
Arnaud Pieton, CEO of Technip Energies, did not mince his words: “The world is finding out that we’re not in an energy transition, we are in an energy addition.”
Pieton added that there’s no replacement and there’s no displacement. “The cheesecake of energy is just getting thicker,” he said. “Of course, the share of renewable in that space is growing, but there’s no replacement and, actually, gas is a is necessary to renewables,” he added.
A leading engineering, procurement and construction player, Technip is observing that the demand for innovation is not stopping the demand for more efficient solutions.
“Decarbonisation will not be an affordable transition. So no one’s paying more for a low-carbon solution… we have to win on affordability,” was Pieton’s pragmatic message, even if the approach to innovation and appetite for risk has improved.
“The maths has to work—in terms of the capex, the opex and the rest. If the maths doesn’t work, there’s no adoption,” Pieton added.
Simonelli also highlighted how the LNG industry has metamorphosed. “We’re very excited because, if you look at the development of LNG over the course of the last few decades, it’s been impressive,” he said, adding that early large-scale projects were stick-built, non-modular and very labour intensive.
Simonelli underlined the point that financially viability is pivotal, with the cost curves over the course of the last 20 years having significantly improved relative to affordability.
“The operations that we are managing and working on are really working 24/7 and producing at limits that previously weren’t anticipated. That is innovation at scale. It’s progress at scale. And it’s allowing us to continue to look forward and make natural gas the destination fuel as opposed to a transition fuel,” Simonelli reiterated. “And I don’t see that stopping.”
Simonelli highlighted the crucial role LNG will continue to play as baseload power in energy systems, given how resilient and clean it is compared with alternatives.
The panellists all concurred that LNG integrates with other energy supplies such as hydropower, wind, solar and hydrogen. It is a case of both, and not either/or.
“You’re always going to need a baseload. And our belief is that natural gas and LNG can be that resilient baseload,” said Simonelli.
The panel also talked about the right regulatory policies and the right permitting and the importance of a well-functioning ecosystem and partnerships.
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