IEA report sees bright future for
natural gas over next 5 years
Medium-Term Gas Market Report 2012 predicts doubling of Chinese
demand and further U.S. growth
5 June 2012 - Natural gas is well on its way to a bright future,
according to a new report from the International Energy Agency (IEA)
that projects China will more than double consumption over the next
five years while lower prices from the unconventional gas revolution
will continue to benefit the United States.
The report, Medium-Term Gas Market Report 2012, released today at
the World Gas Conference 2012, says China will become the
third-largest gas importer behind Europe and Asia Oceania, driving a
2.7% average annual growth in global gas demand through 2017 (up
from the 2.4% annual growth rate predicted in last year’s report).
During the period,
North America will
become a net LNG exporter, while Japanese imports will increase, although by how
much will hinge on the country’s nuclear policies.
Medium-Term Gas Market Report 2012, part of a series of IEA medium-term market
reports also featuring coal, oil and renewable energy, presents detailed
forecasts for the next five years of sectoral demand by region plus supply and
An in-depth analysis addresses infrastructure investments in LNG and
The release of Medium-Term Gas Market Report 2012 comes a week after the IEA
issued a special report, Golden Rules for a Golden Age of Gas, which looks at
the environmental impacts of unconventional gas production and how those impacts
are being – and might be – addressed over the next 25 years.
“The Golden Age of Gas has dawned in North America, but its continued expansion
worldwide depends on producing gas and bringing it to the market in a way that
is friendly to investors and society as a whole,” IEA Executive Director Maria
van der Hoeven said during the launch of Medium-Term Gas Market Report 2012.
“As gas competes against other energy
sources in all market segments, notably in the power sector, pricing conditions
are a key element to keep it competitive everywhere. This medium-term report
aims to facilitate investor decisions by providing a timely, in-depth analysis
of the current trends and what we expect to take place over the coming five
While Medium-Term Gas Market Report 2012 sees growth for natural gas in most
regions, low economic growth, relatively high gas prices and strong growth of
renewable energies will limit demand in Europe.
Successful and timely developments of new
resources should lift gas demand in the Middle East,
Africa and Asia.
The report identifies other future sources of supply, with most incremental gas
production coming from the Former Soviet Union (FSU) and
Further growth in unconventional gas will
come mostly from shale gas in North America plus tight gas and coalbed methane (CBM)
production elsewhere. Shale gas developments in other regions are likely to be
concentrated in China and Poland.
Other key findings of the report include:
A quarter of new gas demand will come from
China, another quarter from the
Middle East and other Asian countries together, and a fifth from North America.
Low gas prices will result in gas generating almost as much electricity as coal
in the United States by 2017.
Global gas trade will expand by 35%, driven
by LNG and pipeline gas exports from the FSU region; most of this expansion
occurs from 2015 onwards, following a period of further tightening of global gas
Natural gas is the most important commodity
with no global market price yet.
Divergence among regional gas prices will
decline but remain a feature of global gas markets.
The emergence of a spot
price in Asia would aid regional producers and buyers.
Medium-Term Gas Market Report 2012 is now on sale and may be ordered from IEA
Bookshop. Please send a request by e-mail to email@example.com, or order at the
About the IEA
The International Energy Agency is an autonomous organisation which works to
ensure reliable, affordable and clean energy for its 28 member countries and
Founded in response to the 1973/4 oil
crisis, the IEA’s initial role was to help countries co-ordinate a collective
response to major disruptions in oil supply through the release of emergency oil
stocks to the markets.
While this continues to be a key aspect of
its work, the IEA has evolved and expanded. It is at the heart of global
dialogue on energy, providing reliable and unbiased research, statistics,
analysis and recommendations.