INSIGHT: A CEO’s Perspective with Bryan Glover, President & CEO, Honeywell UOP

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1. How can we best reconcile our future environmental commitments with the continued global necessity for hydrocarbons, and more specifically, how do we get the balance right?

I think that can be a bit of a challenging question. There's no doubt when we look at the distribution of energy use today, that as we transition to a lower carbon future, hydrocarbons are going to be with us for quite some time.

Certainly, the amount of primary energy that's provided by hydrocarbons today will take some time to be displaced by other energy needs. In the meantime, it's important that we all do the most we can with the hydrocarbon usage that we have today, and that really means using hydrocarbons for energy and for petrochemicals as efficiently as we possibly can. I think we’ll all see additional use of natural gas in the future as a bit of a transition fuel, a hydrocarbon fuel that's at the lower end of carbon emissions, this will help.

Now the current environment makes increased use of natural gas a little bit challenging, but I think as we go forward in the future and we have a little bit more stable supply situation, I think we'll continue to see greater reliance on natural gas as that transition fuel.

In terms of crude oil, I think most companies today are looking at future transition strategies. It's important to understand where people are today and what their strategy is in the future, whether it's to shift more heavily to petrochemicals or to change the types of fuels that they're producing. A lot of things can go into that strategy. But first and foremost, everyone needs to understand what their future strategy is, and then the next thing is to start to make slow and steady progress. Like anything: it's as much about starting as it is about finishing. If we don't get started, we know we'll never finish.

So really when we talk with people about the challenge of the future strategy and moving forward, it's really identifying those early steps that start on a path to a more sustainable future but are accretive, no one wants to make investments early on, that just needs to be replaced later in the game, so we focus with people on how to make progressive and accretive steps along the way.

Certainly, the efficiency of processing hydrocarbons, whether it's to fuel or petrochemicals, is probably the most impactful thing that people can do now – minimising the energy consumption in the processing, minimising water consumption in the processing, minimising capital inputs in the processing. Those are all important.

One of the other key steps is the efficiency of hydrogen use in the process. We know that hydrogen can be a significant contributor to CO2 production in the world, production of hydrogen is a key contributor there, so using hydrogen efficiently in a refinery or petrochemical plant is very important as well, and so adapting or having the right technologies to use hydrogen in the most efficient way to transform molecules from what they start at in the crude to the chemicals or the fuels that a customer wants, in the end, is critically important.

We find that's where a lot of the initial low-hanging fruit is – in better hydrogen management, either better hydrogen capture, reducing the amount of hydrogen consumption by routing different feedstocks in different ways or using them for different purposes. So, there's a lot that can be done at the start of the journey to get people through those first steps of reduction in carbon intensity and in many cases, especially around hydrogen, those can actually have a return given the fact that hydrogen is a valuable commodity and expensive to produce.

As you said, very much a journey and the best thing to do is really identify those low-hanging fruits to get you onto that path.

Yes, that's right. Sometimes those things are obvious, but other times they're less obvious. What I can say when I think about UOP, there are a lot of new technologies and emerging solutions that we've been working on that really didn't even exist 5-10 years ago, and so what we find is, there isn’t always as much awareness as there could be of some of the new options, and some of the new technologies that are available. I think that's where it's valuable for someone looking at this journey to sit down with somebody like UOP and talk about what could be because I think the value that we bring is different today than it was even ten years ago.

And we hear that at many of our events, that collaboration is key.

I think, collaboration is very key today, especially because the problems we're trying to solve are more complex and in many cases, you know the answer can come from a single source or a single entity, but in other cases, it does require maybe more than one organization working together to provide a full broad-spectrum solution that really gets us where we need to go.

As a company, we've always collaborated with other parties to bring new technology to the market, but I think we find today that we're collaborating more than ever in order to bring new solutions to the market whether it's in the area of carbon capture, hydrogen production, decarbonization, new fuels from bio sources. In all those cases, I think the challenge becomes more complex and the speed of change increases and that really increases the opportunity for companies to work together to bring broader solutions to the market.

How can the downstream industry in the MENA region best adapt their existing assets to meet low carbon objectives, and how can technologies and technology solution providers like Honeywell UOP help?

I think the region in general is well-positioned to bring low-carbon solutions to the industry. A few things are an advantage. One is that, for the most part, it's a producing region, so having downstream in combination with production increases opportunities for things like carbon capture and storage. Not all regions can support that, but certainly in much of the MENA region that becomes a very realistic opportunity, and so there are technologies today that are readily available from UOP and others, but technologies like our cryogenic carbon capture or our advanced solvent technology, that can be readily applied to capture CO2 both pre and post-combustion, and then in a region like MENA there is the opportunity for sequestration.

Beyond that, a significant opportunity within the region, because it's a significant exporting region, is to tailor production to the most targeted products, whether that's petrochemicals or fuels produced with the lowest potential carbon intensity. So, the fact that the region in many cases is exporting products gives it an opportunity to tailor the products to things that are lower in carbon intensity and to maximise potential petrochemical production and minimise the potential for some of the more carbon-intensive fuels. So, I think those are some of the main opportunities for the region.

I think any given operator, any given refiner, or any given petrochemical plant can look beyond that because everyone will have site-specific needs or site-specific opportunities depending on what sort of resources are available on the ground. I think that's one of the important things when we think about long-term sustainability: is taking advantage of the asset base that you have today. One of the most sustainable things that you can do as you transform a plant is to use what you've got and minimise the amount of new infrastructure that needs to be included.

Within the region, I think there's a good opportunity to look at the asset base and look at the transformations that make sense based on the crude or feedstocks and the product mix that is available. As I say, being a large exporting region that provides additional flexibility and product mix that some regions might not have, and I think it can allow producers in the region to really target their operations to exactly what they want to accomplish strategically.

Really adapting and modifying rather than opting for major investments.

Well, I think major investments will continue, right? Many producers in the region have the advantage of local and relatively low-cost feedstocks, and the region is going to continue to grow because of that, you know producing for domestic needs, but also producing for export taking advantage of the rich resources that are available.

But I think it's a balance, right? It's a balance of adapting assets that are already available in order to adapt existing plants as well as then build out new facilities and new infrastructure to meet future needs. Examples are things like crude to chemicals, we see that as an increasing area of interest, certainly an area where we and others have spent a lot of time and there are new technologies available there that weren't even available 2-3 years ago, that can make these kinds of projects very attractive today at capital intensities that would be much lower than people expect, through new technologies that really manage the molecules within a crude, manage the amount of hydrogen addition and can get there very selectively. Technologies like that are probably well used in new facilities and some of those can be retrofitted in existing facilities. But again, it's about a balance of the two: smart investments in new facilities and then really smart retrofits, maximising the value of existing assets.

So then, taking the conversation closer to home. In your opinion, Brian, how can conferences like ESF MENA help to promote the discussion with regards to decarbonizing the downstream industry?

I think, especially in the transitioning world today, conferences like this are really helpful because they create an environment for challenging conversations, right?

We bring owners of operating assets together with technology providers and others that work in the industry to talk about solutions. We get new ideas out there.

But then conferences like this also lead to interesting and challenging questions, as asset owners pose questions to panels, pose questions to speakers, and have discussions during the breaks.

We as a technology provider, we hear intriguing and sort of provocative questions. People who are potential customers hear about technologies that maybe they didn't realise were available or didn't understand to be mature.

I think it leads to a lot of good discussion, both formally in the sessions and outside the sessions about what could be. I think the really important thing is when we really start together to talk and push each other about the could be - then we start to identify solutions that maybe weren't apparent to anyone going in because we either didn't fully understand the situation someone was facing or someone didn't understand the array of opportunities that were available to them, and I think we find that solutions in many cases are closer at hand than we thought, or we get a better idea of what sort of adaptations need to be made either in strategic plans or in technology development in order to meet those situations.

I think conferences like this move the conversation along at an accelerated pace by bringing people together in one place to talk about problems and challenges and to challenge one another to think about how we can best solve those.

It's back to what we said earlier. The transition is a journey. There's no one solution, and collaboration across the entire value chain is key to getting us there.

Yeah, I think that's right. I think it's collaboration, and conversation is important because until we all understand each other's challenges and each other's opportunities and capabilities, we really don't necessarily get at the full solution to a problem.

Bryan Glover will join an exceptional panel of key industry leaders to discuss strategies, opportunities and technologies available in the MENA region. The discussion will focus on a net-zero future, starting from the merits of the strategies being put in place in the GCC, and continuing on to the industry collaboration opportunities and CCUS.