Gas demand to increase by 1.7% per annum: GECF

Baku, Azerbaijan, Dec.26

By Leman Zeynalova – Trend:

Natural gas demand is expected to increase by 1.7 percent per annum, from 3709 billion cubic meters (bcm) in 2017 to 5427 bcm in 2040, corresponding to an overall growth of 46 percent, the Gas Exporting Countries Forum (GECF) told Trend.

Global natural gas demand will remain concentrated in the power generation, the industrial and domestic sectors, said the organization.

“Most of demand growth will come from Asia-Pacific region. It is currently the second-largest consumer of natural gas, after North America, and accounts for 21 percent of global gas demand (or 794 bcm). Demand in the region is projected to increase at an annual average pace of 2.6 percent, reaching 1422 bcm in 2040, driven by economic growth and strong coal-to-gas switching policies. It will allow Asia-Pacific to catch-up with North America. These two regions will constitute the largest gas consumers in 2040, each with 26 percent shares. The United States will consume 82 percent (1173 bcm) and China 49 percent (701 bcm) of demand in their respective regions,” said GECF.

The Forum believes that gas consumption in the Middle East is expected to grow by 1.7 percent per annum, from 503 bcm in 2017 to around 747 bcm in 2040. “Countries in this region will represent 14 percent of global gas demand in 2040.”

At the same time, GECF said that for example, gas demand in Europe is projected to grow by 0.3 percent per annum and to reach about 573 bcm in 2040.

“This slow growth, compared to other regions will be attributed to energy efficiency policies, declining energy intensity, supply security concerns, the use of renewable energy and a production decline in the Netherlands. By 2040, Europe will consume around 11 percent of global gas demand,” said GECF.

The organization believes there is no doubt that natural gas is the engine of the economic and industrial development. “This is our faith at its deepest level, considering the market dynamics, the abundance of natural gas resources worldwide, the sustainable development goals (SDGs) and the economic growth worldwide.”

“The advanced economies of the G20 recognize the key role of natural gas for most of the G20 countries. Indeed, G20 Ministers believe in the high potential of natural gas to support the transitions towards lower emission energy systems.From a short-term perspective, natural gas demand has been growing steadily driven by favorable energy policies, and particularly by coal to gas policies implemented by the Government of China to tackle the air quality issues,” said GECF.

A growth of around 4 percent recorded in 2017 and a sustained growth in 2018 are indicating a healthy trend for natural gas future, according to the organization.

Additionally, GECF said that the IMO regulations on Sox emissions, that will enter into force in 2020, is a key driver to see a great expansion of LNG in the maritime sector.

“The commitment to the Paris agreement and the results of COP24 recorded this year are all indices for optimism towards the future of natural gas. Of course there is a lot to do to advocate natural gas as the fuel of future and bring awareness among the international community. This could be done through dialogue with all the market stakeholders. GECF efforts were at the forefront of promoting natural gas as a fuel of choice for sustainable development,” said the Forum.

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