Energy Watch Group 2013 Natural Gas Supply Outlook

Energy Watch Group. March 2013. Fossil and Nuclear Fuels – the Supply Outlook (172 pages)

Summary (see report for details)

This report also contains scenario projections for the future supply of natural gas. These are performed in similar depth as the projections of future oil supply. Important findings are:
Conventional gas production is in decline in Europe and North America which together hold almost 35 per cent of world gas production.

Unconventional gas production, predominantly shale gas production, has increased US production in the last years since the exemption of the gas industry from environmental regulations of the Safe Drinking Water Act (SDWA). Now shale gas has a U.S. market share of 30 percent.

Shale gas production in the USA is unlikely to see a significant further expansion. Due to the particular production dynamics of shale gas it will decline as soon as new wells are not being developed any more at an adequate rate. The decline of shale gas production from 2015 onward will add to the decline of conventional gas production. In 2030 gas production in the US probably will be far below present production levels.

Gas production in Europe has been in decline since the turn of the century and will continue to follow that trend. Shale gas production will not play a role comparable to the one in U.S., since geological, geographical, and industrial conditions are much less favorable. In order to keep gas consumption in Europe flat or rising, imports will need to increase by at least additionally 200 billion m3/yr.

Russia, the second largest natural gas producer closely behind the U.S., faces a struggle between declining production from aging fields and new expensive and time consuming developments in Northern Siberia and offshore. Russian gas production reached a first peak in 1989 when the largest fields passed peak production. Gazprom production never reached that level again. Aging fields force Russia to speed up the development of new fields. The developments of Shtokmanskoye in the Barents Sea and of other fields in Yamal are delayed. If the gas fields in the Yamal Peninsula would be developed in time, they would have produced 310-360 bcm in 2030 according to Gazprom. But even this will not be sufficient to compensate for the decline of aging current fields.

Domestic consumption in Russia and growing demand from Asia will put increasing pressure on volumes available for export from Eurasia to Europe in the coming years.

The Middle Eastern countries Iran and Qatar are expected to feed the rising demand for liquefied natural gas over the next decades. Though these countries have large reserves, it is highly probable that reported reserves are exaggerated.

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