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GLOBAL SUPPLY AND DEMAND FOR NATURAL GAS
May 15, 2012
Presented by:
SERGEY PALTSEVPrincipal Research ScientistMassachusetts Institute of Technology
STRIKING A BALANCE
IN THE MIDST OF CHANGE
May 13-16, 2012
Québec City, Québec (Canada)
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MOTIVATION
Shale Gas LNG and Global Market Move from Coal to Gas Move to Renewables Economics vs Geopolitics
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MAJOR POINTS
Global natural gas use will grow from the current 110 Tcf to 160 Tcf in 2030, and 180-190 Tcf in 2050.
Gas markets are still regional (U.S., Europe, Asia)
Integrated gas markets lead to an even greater use and relatively lower prices.
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MAJOR POINTS (Cont.)
Watch for surprises-U.K. gas-U.S. gas-Poland gas-China gas
U.S. - $2-4, Europe - $8-10, Japan - $15: A case for long-term substantial U.S gas exports?
-Maybe not.
Shale gas in China might be a game changer-But perhaps not in the next decade
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NATURAL GAS PRICES, BP (2011)
Winter 2011-2012 Prices: US – (Sept - $4; March - $2), UK - $10 (NBP on Oct 3 – $6.50; Feb 7 - $15.50, end of March - $9.40), Germany - $11, Japan - $15-16.
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GLOBAL NATURAL GAS USE
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NATURAL GAS RESOURCES
Global Consumption: 2000 - 100 Tcf2050 – 160-190 Tcf
Global Reserves:6,600 Tcf (BP, 2010)
Global Resources:World – 16,000 Tcf
(plus shale gas in non-North America)
Source: MIT (2011)
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INTERNATIONAL GAS MARKET DEVELOPMENT, 2030
Regional Markets
Source: MIT (2011)
Global Market
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NATURAL GAS IN EUROPE
Source: MIT Joint Program Report 201 (2011)
GHG policy and nuclear power reduction change the prospects
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NATURAL GAS IN ASIA
Source: MIT Joint Program Report 201 (2011)
Even more uncertainty
Government support
Use in residential sector (heating and cooking) and industry
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SHALE GAS RESOURCES
Source: EIA (2011)
No estimate for Russia or the Middle East
Global Resources:16,000 Tcf
Additional Shale :6,000 Tcf
Global Resources: 22,000 Tcf
Poland: IEA (2011) – 187 Tcf
Poland Government (2012) - 12-28 Tcf;Might be up to 67 Tcf
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SHALE GAS IN CHINA
Source: EIA (2011)
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(NO) SHALE GAS IN CHINA AND GLOBAL SUPPLY
Source: Paltsev, Ejaz, O’Sullivan (2012)
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SHALE GAS IN CHINA AND GLOBAL SUPPLY
Source: Paltsev, Ejaz, O’Sullivan (2012)
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CHINA GAS – POTENTIAL FUTURES
Consumption
Production
Shale gas availability changes gas prospects in China
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CHINA GAS – POTENTIAL FUTURES
By 2050 China might become natural gas exporter
Imports
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MAJOR POINTS
Global natural gas use will grow from the current 110 Tcf to 160 Tcf in 2030, and 180-190 Tcf in 2050.
Gas markets are still regional (U.S., Europe, Asia)
Integrated gas markets lead to an even greater use and relatively lower prices.
Watch for surprises-U.K. gas; U.S. gas; Poland gas; China gas
U.S. - $2-4, Europe - $8-10, Japan - $15: A case for long-term substantial U.S gas exports?
-Maybe not.
Shale gas in China might be a game changer-But perhaps not in the next decade
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THANKS ARE DUE
Qudsia Ejaz
Francis O’Sullivan
Ernest Moniz
John Reilly
Henry Jacoby
Tony Meggs
Jim JensenPicture: toonpool.com