Gazprom delivers Europe's first carbon neutral LNG cargo to Shell

The first-ever carbon neutral cargo of liquified natural gas (LNG) in Europe was delivered by Russian energy giant Gazprom to the oil major Shell at its Dragon LNG terminal in Wales, United Kingdom, Shell said Monday.

"We are grateful to Gazprom for partnering with us in delivering the first carbon neutral LNG cargo in Europe. We have already delivered seven carbon neutral cargoes in Asia and are very excited to be able to now offer this to customers in the UK," said Steve Hill, Executive Vice President, Shell Energy.

The delivery was made carbon neutral via a transaction to ensure that emissions associated with the production, delivery and usage of the fuel have either been removed from the atmosphere through a nature-based process or emissions were saved through avoided deforestation, said Shell.

"Using nature-based carbon credits to compensate for emissions that cannot be avoided or reduced is an important step as we find more ways to reduce emissions across the LNG value chain," added Steve Hill.

The reference to offsetting through nature-based processes or through avoided deforestation suggests that certified emission reductions (CERs) - one of the cheapest forms of carbon credits and one of the most controversial - were not used.

Later this year, UN negotiators will meet in Glasgow, UK to advance talks on a global carbon market. 

It is unclear what role CERs, which can originate from historical emission reductions, will play in a future carbon market.

Fossil fuel traders using carbon credits to offset emissions from the production and supply of oil and gas is on the rise, with the first crude oil cargo "greened" last year.