BAKU, Azerbaijan, Nov.12
By Leman Zeynalova – Trend:
Some 200 billion barrels of oil equivalent (bnboe) of new gas resource developments are needed to meet demand through to 2040, Trend reports with reference to Wood Mackenzie,
The company believes that major contributors include Qatar with its additional LNG mega trains, and the US, Russia and China. “Also known as the ‘Big 4’, these countries combined currently account for almost half of global gas supply. The ‘Big 4’ is expected to meet 60 percent of global gas demand by 2040."
“We estimate almost US$2 trillion of capital is needed to deliver this growth in supply. However, a 2-degree demand scenario dramatically alters this outlook, with future supply requiring a more modest, though still considerable, US$700 billion of new investment as global gas demand peaks earlier.”
Wood Mackenzie believes developers and investors need to consider three key areas – investing in sustainability, increasing competitiveness, and embracing new sources of capital.
“Sustainability is becoming the mantra across the industry, with carbon mitigation and ESG increasingly at the heart of decision making. Some sustainability investments include reduction in venting, leakage and fugitive emissions, use of renewables to power LNG facilities, carbon offsetting, CCUS technology for high CO2 fields and liquefaction and partnering with end-users to reduce emissions.
To raise competitiveness, future portfolios must be founded upon the best assets. Suppliers must continue to put pressure on costs, consider divestment and alternative ownership of assets, and develop innovative contracting and enhanced trading capabilities.
As gas markets evolve, so, too, will sources of capital. Non-traditional and more diverse investors and partners are creating opportunities for global gas players to push projects forward, while potentially also gaining access to growth markets. China, sovereign wealth funds and equity funding are some possible future sources of capital and ownership,” the company said.
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