Wood Mackenzie, a top global provider of data and analytics, has supported the energy and natural resources sectors for over 50 years. With 2,300 experts in 30 locations, they offer vital insights and consultancy.
Circular Business Review brings to you an exclusive interview with Wood Mackenzie Director, Hydrogen and Low Carbon Fuels – EMEA Claude Mourey.
CBR: Throughout your career, you have led various multi-disciplinary teams each with distinct goals and challenges. What strategies do you use to manage and integrate diverse teams effectively, especially when working on complex, multi-faceted projects?
Claude Mourey: I have had the opportunity to travel extensively and work in a wide variety of environments. So, for me, the key to success lies in working with diverse teams.
I see diversity as a significant advantage—truly a competitive edge—due to the varied perspectives that all team members bring to the table. To answer your question about managing and integrating a team, I believe there are a few fundamental pillars for success, which apply not just to multi-cultural teams but to all teams. These are three in particular:
The first is clear and open communication. It is crucial to ensure that everyone understands the project and their role within it. It is important to foster an environment where team members feel free to share their ideas, concerns, and feedback.
The second point is structured collaboration. By this, I mean establishing an operating rhythm through regular team meetings to discuss and track progress, ensuring alignment. Additionally, using project management tools can be especially helpful when teams are spread across different locations.
The third, which I think is absolutely fundamental, is to leverage the strengths of each team member and build trust. As a manager, you need to quickly understand the strengths of each individual and leverage these. Building trust is critical, and one effective way to do this is by leading by example and displaying the behaviours you expect from the team.
To truly harness the competitive advantage of diversity, there’s one factor that distinguishes good teams from great ones: promoting an inclusive culture. This is a daily effort, rooted in encouraging different points of view and fostering respect.
Team members from different backgrounds will often see problems from unique perspectives. While these perspectives may sometimes initially seem distant from the original plan, they almost always add value. Encouraging this diversity of thought is especially vital when facing challenging situations that require innovative solutions.
Lastly, it can be beneficial to consider diversity training. Depending on the length of your project and when time permits, incorporating diversity training can help team members understand new and different cultures. After all, you don’t know what you don’t know. Awareness of how diverse the world can be, and how differently people might see and react to situations, is incredibly positive.
CBR: Wood Mackenzie has been a trusted partner for over 50 years, providing crucial data and insights to various stakeholder. How does Wood Mackenzie ensure the accuracy and relevance of its data amidst rapidly evolving markets?
Claude Mourey: Wood Mackenzie operates at the forefront of the current energy industry trends, offering industry-leading energy data and analytics with the bold purpose of transforming the way we power our planet. We have two primary teams: the research team and the consulting team.
Both teams utilize data, ensuring its relevance and accuracy by drawing from a range of sources. These sources include online resources, but more importantly, they come directly from the vast network of industry contacts we’ve developed over these 50 years across the entire value chain. We collect data, verify it, and constantly update our datasets, refreshing our research to reflect the latest intelligence.
That’s essentially how we maintain the accuracy and relevance of our data.
CBR: Energy markets and strategies can vary significantly between regions due to different regulatory environments, resource availability, and economic priorities. What are the key differences you observe between the Middle East and Europe in terms of energy strategies and the adoption of low-carbon fuels?
Claude Mourey: These are two very distinct markets, and I think the key differences can be summarized in three themes: energy source focus, regulatory and policy frameworks, and the pace of adoption and technological advances.
First, regarding energy resources and strategy, the Middle East is heavily dominated by fossil fuels. It is one of the world’s largest producers, with vast reserves of oil and natural gas. Historically, the region’s energy strategy and economic development have been largely based on these resources, which they primarily export. However, there has been a recent shift towards diversification to reduce dependency on fossil fuels, with increased investments in renewables and nuclear power. The Middle East is still in the early stages of its investment in renewable energy, benefiting from abundant solar resources and, in some areas, wind.
In contrast, Europe began focusing on renewable energy much earlier and has a stronger emphasis on decarbonization. The reasons for this vary, but one key factor is the desire to diversify the energy mix and reduce dependence on fossil fuels, recently exacerbated by the Russia-Ukraine conflict. Europe has made significant investments in wind and solar energy. Countries like France, for example, have long relied on nuclear power, a strategic choice made years ago. Europe also leads in terms of regulatory frameworks; the regulations addressing emissions are among the most matured globally. The European Union’s Emissions Trading System (ETS) and carbon pricing are key instruments supporting decarbonization efforts.
Technological innovation is another area where Europe differs from the Middle East. Europe is heavily investing in new energy technologies, supported by robust funding schemes aimed at accelerating the energy transition. This focus on technology is less pronounced in the Middle East, although the region is making strides, particularly with carbon capture and storage (CCS) technology, which makes sense given its vast oil and gas resources. The Middle East is also exploring blue ammonia production and UAE used to boast until recently the world’s largest solar park, demonstrating that when they commit, they do so on a large scale.
Energy efficiency is another major focus in Europe, with strong policies aimed at improving efficiency in buildings, industrial processes, and transportation. The electricity market in Europe is also more mature, with a greater emphasis on integrating renewable energy into the grid to ensure it can handle the future influx of renewable power.
CBR: What advice would you give to European companies aiming to invest or establish their companies in the Middle East, especially in UAE?
Claude Mourey: My advice would be, first and foremost, to ensure you have the right local partner—this is crucial as it demonstrate commitment to local economy, ensure close governance link with UAE representatives and ease access to local offtakers.
In the UAE, when dealing with energy transition, moving to low carbon energy, most of the projects are on a mega scale and primarily focused on exports. However, I would suggest tapping into the need of local industries to decarbonize their products using locally produced green molecules.
Instead of focussing on exporting green molecules into the same identified demand markets that all advantaged projects are targeting, understand how you could meet the needs of local/regional offtakers, whether it is refineries, steel, cement, or the fertilizer industry. This has two advantages:
One of them is contributing to the UAE national decarbonisation strategic goals; as well as considering the complexity to export Hydrogen, exporting manufactured green products is much simpler as it does not require the development of a new infrastructure / supply chain.
CBR: Wood Mackenzie recently published an analysis on the Golden Pass LNG terminal, highlighting a delay and its significant shift in the supply forecast. How do you assess the impact of such delays on the global LNG market and on broader energy transition efforts?
Claude Mourey: Regarding the impact of the Golden Pass LNG delay, the insights come from my colleagues who specialize in this area. The deferment of the Golden Pass LNG project could briefly affect LNG supply, global LNG prices, and ultimately, US natural gas production and prices. The three trains at full utilization represents around 18% of the current US LNG gas requirements, which is a substantial volume.
In the short term, around 2025-2026, this delay might put downward pressure on US gas prices, potentially encouraging a higher gas burn rate. The economic displacement being with coal, it could overall support a reduction in emissions.
As for the LNG market, the anticipated oversupply of LNG might not materialize as expected, which could lead to stronger prices for a longer period. While this delay may reduce the risk of oversupply and mitigate the impact of US cargo cancellations, it is unlikely to have a significant effect on offtakers, as Europe has strong gas reserves for the upcoming winter. Additionally, other projects like the Plaquemines LNG and Corpus Christi Stage 3 are set to start soon, which should help stabilize the market.
However, suppliers and midstream companies might need to adjust their drilling plans, as the reduced need for gas could lead to a postponement of the availability of this volume. But overall, we believe the market will manage these adjustments.
CBR: How do geopolitical events shape the energy landscape, particularly in the hydrogen sector?
Claude Mourey: Geopolitics and energy have always been closely intertwined, and this is especially true for the hydrogen sector. Given how young the hydrogen value chain is, the influence of geopolitics is even more pronounced. For example, government-to-government relationships play a critical role in forming partnerships, supporting the creation of consortiums, and opening up trade flows, all of which are vital for the development of the hydrogen market.
In the context of the energy transition, we’ve often talked about the trilemma of affordability, sustainability, and security of supply. Hydrogen has the potential to diversify energy supply, introducing new players into the energy export market, including countries that have never been traditional energy exporters. This adds a new dimension to global energy dynamics.
Strategic alliances and trade agreements are absolutely crucial. We can see this in how Germany has been actively securing supply corridors to ensure access to low-carbon hydrogen. Additionally, technology leadership and competition are significant factors. For example, in the energy transition, we witnessed how China dominated the solar panel market, and now something similar is happening with electrolysers, which are essential for producing hydrogen through electrolysis. There’s growing tension as European and US markets express concerns about the much cheaper alkaline Chinese electrolysers.
Another critical geopolitical factor in the hydrogen sector is the establishment of standards. There’s a lot of talk about the need for standards, but the question is: who sets these standards? Those with geopolitical influence will have a significant say in shaping these standards, which we’ve already seen with varying levels of stringency being applied in different regions.
This makes the energy sector, particularly hydrogen, so fascinating because of the powerful underlying geopolitical forces at play.
CBR: What investment trends are you currently observing in the energy sector, particularly in hydrogen and low-carbon technologies?
Claude Mourey: Unfortunately, the latest quarter has seen a slowdown in the hydrogen sector, with the lowest level of project announcements since 2020—only 4 million tons per annum of additional capacity were announced. It might seem like a slowdown, but what we’re seeing is that developers are increasingly focusing on advancing existing capacities.
Despite this quiet quarter, offtake activity is actually increasing. Among the 200+ offtake agreements we are tracking, 28 were signed in Q2 alone, equating to a volume of 0.8 million tons per annum of hydrogen. So, while new announcements may be down, investment is shifting towards project execution.
On a macro level, Northeast Asia is leading the momentum with numerous agreements in place, though many of these aren’t binding offtake agreements yet. However, once they are finalized, they are expected to significantly boost the low-carbon hydrogen market.
Regarding technology and hydrogen color, many ATR-based blue hydrogen projects are on the verge of final investment decisions, particularly in the U.S. Gulf Coast. Some headwinds remain, such as awaiting the finalization of the 45V tax credit guidance, and the upcoming election has caused some decisions to be put on hold.
In terms of project typology, the most advanced projects are primarily targeting exports and conventional end use, with many export volumes aimed at power generation and sectors like fertilizer and ammonia production. There is also movement in Europe with supportive investments, such as the European Hydrogen Bank’s pilot auction and the Dutch subsidy scheme, which are expected to trigger final investment decisions. Australia recently launched a production tax incentive, while market mechanisms like the South Korean Hydrogen Power Buying Market and Japan’s contracts for difference are expected to stimulate further project development and investment.
From an OEM perspective, the electrolyser market appears to be in oversupply. There is also concern about the dominance and cost advantage of Chinese technology like I mentioned earlier. Despite significant funding from Europe and other regions, it remains challenging for electrolyser producers to scale up purchase orders as expected.
