Worldwide natural gas demand is expected to rise 1.6% per year during 2014-35 and this growth in absolute terms would outstrip that of all other energy sources, a study released by the French international association for gas, Cedigaz, said Tuesday.
Cedigaz sees natural gas and LNG as “a key transition fuel” towards an increasingly renewable-based, efficient and sustainable energy system.
China and the Middle East are expected to lead the way in gas demand growth, accounting for respectively 28% and 24% of the incremental volume over the projection period to 2035, Cedigaz said in its report.
At the national level, the largest growth in gas demand is expected in China, India, Iran, the US and Saudi Arabia.
The strong expansion of LNG supply and the abundance of both conventional and unconventional resources will help gas to expand its role in the energy mix to the detriment of coal and oil, Cedigaz said.
Cedigaz also noted that due to increased globalization of gas markets and diversification of natural gas supply, spot pricing will be a growing component for the commercialisation of gas.
Many countries have policies that should favor gas consumption over other hydrocarbon sources, especially in the power sector, the association said.
“Coal-to-gas switching contributes to a strong decline in the future growth of carbon emissions. However, this will not be enough to reach the +2°C target: emissions in the Cedigaz scenario would put the world closer to a +3°C path,” it said.
LNG rises more rapidly than pipeline gas
Global liquefied natural gas sector will grow much faster than pipeline gas trade by 2035.
The share of LNG in interregional flows would grow from 44% in 2015 to 55% in 2035 while international LNG trade would rise by 3.7% per year to 669 bcm in 2035, Cedigaz said.
According to Cedigaz, Asian emerging markets will take more than 70% of the incremental imports.
The association noted that additional LNG export capacity will be required post 2023 to meet rising natural gas demand adding that delays in the second wave of LNG supply could bring a risk of tighter markets in the 2020s.
LNG World News Staff