International Gas Outlook
International Gas Outlook Glen Sweetnam Energy Information Administration
The Evolution of Global Gas Markets Center for Strategic and International Studies Washington, DC October 28, 2009
Gas consumption is expected to grow as global economic growth resumes 250
History
Projections Liquids (Including Biofuels)
32%
200
28%
Quadrillion Btu
36%
27%
100
50
23%
Coal
150
23%
Natural Gas Renewables (Excluding Biofuels)
Share of World Total
8% 6%
6% Nuclear
0
1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 Source: IEO2009 Global Gas - Oct 28, 2009
2
11%
In end-use, gas will be competing primarily against other non-mobile energy sources Gas consumption by sector 400 350
Bcf/d
300 250 200 150 100 50 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
-
Power Generation
Industrial Cogen
Residential
Commercial
Industrial Feedstock
Transportation
Global Gas - Oct 28, 2009
3
Other Industrial
A dramatic change in U.S. gas production occurred in the last 3 years U.S. Dry Natural Gas Production (Bcf/d)
60 58
3.3% per year
56 54 52
Hurricane Ike
50 48
U.S. Dry Natural Gas Production
46 44
Hurricanes Rita and Katrina
42 40 1997
1998
1999
2000
2001
2002
2003
Source: AEO2009 Global Gas - Oct 28, 2009
4
2004
2005
2006
2007
2008
2009
Lower-48 U.S. Dry Natural Gas Production (Bcf/d)
Unconventional gas has more than compensated for the decline in conventional production 45
Conventional Production 40 35 30 25 20 15
Unconventional Production 10 5 0 1990
1992
Source: AEO2009 Global Gas - Oct 28, 2009
1994
1996
1998
5
2000
2002
2004
2006
2008
Unconventional gas production has reduced the prospects for LNG imports into the U.S. AEO2009 AEO2009 HP AEO2009 LP AEO2008 AEO2007 AEO2006
5 4.5
Trillion Cubic Feet
4 3.5 3 2.5 2 1.5 1 0.5
Projections
History
0 2000
2005
Source: AEO2009 Global Gas - Oct 28, 2009
2010
2015 6
2020
2025
2030
Global Gas - Oct 28, 2009 7
Russia
Africa
Non-OECD Europe and Eurasia
Latin America
Western Europe
Other Asia
Brazil
Canada
Mexico
United States
Australia & NewZealand
China
Unconventional gas is also likely to play an important role in other regions
70% 60% 50% 40% 30% 20% 10% 0%
As in the U.S., unconventional gas production offsets declining conventional production 500 450 400
Bcf/d
350 300 250 200 150 100 50 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
0
Conventional Onshore Global Gas - Oct 28, 2009
Conventional Offshore 8
CoalBed Methane
Tight & Shale Gas
OECD Europe is expected to experience the largest increase in gas imports Net Gas Imports 2035
Global Gas - Oct 28, 2009
9
India
China
Brazil
Mexico
South Korea
Non-OECD Europe and Eurasia
United States
Japan
40 35 30 25 20 15 10 5 0 -5 -10 OECD Europe
Bcf/d
2006
Australia, Qatar, and Russia are expected to provide the largest increases in exports Net Gas Exports 2035
Global Gas - Oct 28, 2009
10
Russia
Africa
Canada
Other Asia
Middle East
Latin America
-40 -35 -30 -25 -20 -15 -10 -5 0 5 10 Australia & New Zealand
Bcf/d
2006
Growing exports will require both increased pipeline capacity and . . . 40 35 30
Bcf/d
25 20 15 10 5
USA OECD Europe Canada Mexico
Global Gas - Oct 28, 2009
Russia Africa Other Asia
2035
2034
2033
2032
2031
2030
2029
2028
2027
2026
2025
2024
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
0
Middle East Non-OECD Europe and Eurasia Latin America
11
. . . and increased liquefaction capacity
70 60
Bcf/d
50 40 30 20 10 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
0
Africa
Australia & New Zealand
Brazil
Latin America
Middle East
Other Asia
Russia
United States
OECD Europe
Global Gas - Oct 28, 2009
12
In the near term, increased export capacity will put downward pressure on gas prices 24 22 20 18 16 14 12 10 8 6 4 2 0
Oil
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
2006 $ / mmBtu
Average wholesale gas prices
China - South Qatar
Europe- North Russia West
Oil Global Gas - Oct 28, 2009
13
Japan US - West South Central
In 2035, we expect a $ 3 – 5 price differential between regions Average wholesale gas prices in 2035 18
2006 $ / mmBtu
16 14 12 10 8 6 4 2 0 China - South Europe- North
Global Gas - Oct 28, 2009
Japan
14
Qatar
Russia West
US - West South Central
The Evolution of Global Gas Markets Center for Strategic and International Studies Washington, DC October 28, 2009
Gas consumption is expected to grow as global economic growth resumes 250
History
Projections Liquids (Including Biofuels)
32%
200
28%
Quadrillion Btu
36%
27%
100
50
23%
Coal
150
23%
Natural Gas Renewables (Excluding Biofuels)
Share of World Total
8% 6%
6% Nuclear
0
1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 Source: IEO2009 Global Gas - Oct 28, 2009
2
11%
In end-use, gas will be competing primarily against other non-mobile energy sources Gas consumption by sector 400 350
Bcf/d
300 250 200 150 100 50 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
-
Power Generation
Industrial Cogen
Residential
Commercial
Industrial Feedstock
Transportation
Global Gas - Oct 28, 2009
3
Other Industrial
A dramatic change in U.S. gas production occurred in the last 3 years U.S. Dry Natural Gas Production (Bcf/d)
60 58
3.3% per year
56 54 52
Hurricane Ike
50 48
U.S. Dry Natural Gas Production
46 44
Hurricanes Rita and Katrina
42 40 1997
1998
1999
2000
2001
2002
2003
Source: AEO2009 Global Gas - Oct 28, 2009
4
2004
2005
2006
2007
2008
2009
Lower-48 U.S. Dry Natural Gas Production (Bcf/d)
Unconventional gas has more than compensated for the decline in conventional production 45
Conventional Production 40 35 30 25 20 15
Unconventional Production 10 5 0 1990
1992
Source: AEO2009 Global Gas - Oct 28, 2009
1994
1996
1998
5
2000
2002
2004
2006
2008
Unconventional gas production has reduced the prospects for LNG imports into the U.S. AEO2009 AEO2009 HP AEO2009 LP AEO2008 AEO2007 AEO2006
5 4.5
Trillion Cubic Feet
4 3.5 3 2.5 2 1.5 1 0.5
Projections
History
0 2000
2005
Source: AEO2009 Global Gas - Oct 28, 2009
2010
2015 6
2020
2025
2030
Global Gas - Oct 28, 2009 7
Russia
Africa
Non-OECD Europe and Eurasia
Latin America
Western Europe
Other Asia
Brazil
Canada
Mexico
United States
Australia & NewZealand
China
Unconventional gas is also likely to play an important role in other regions
70% 60% 50% 40% 30% 20% 10% 0%
As in the U.S., unconventional gas production offsets declining conventional production 500 450 400
Bcf/d
350 300 250 200 150 100 50 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
0
Conventional Onshore Global Gas - Oct 28, 2009
Conventional Offshore 8
CoalBed Methane
Tight & Shale Gas
OECD Europe is expected to experience the largest increase in gas imports Net Gas Imports 2035
Global Gas - Oct 28, 2009
9
India
China
Brazil
Mexico
South Korea
Non-OECD Europe and Eurasia
United States
Japan
40 35 30 25 20 15 10 5 0 -5 -10 OECD Europe
Bcf/d
2006
Australia, Qatar, and Russia are expected to provide the largest increases in exports Net Gas Exports 2035
Global Gas - Oct 28, 2009
10
Russia
Africa
Canada
Other Asia
Middle East
Latin America
-40 -35 -30 -25 -20 -15 -10 -5 0 5 10 Australia & New Zealand
Bcf/d
2006
Growing exports will require both increased pipeline capacity and . . . 40 35 30
Bcf/d
25 20 15 10 5
USA OECD Europe Canada Mexico
Global Gas - Oct 28, 2009
Russia Africa Other Asia
2035
2034
2033
2032
2031
2030
2029
2028
2027
2026
2025
2024
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
0
Middle East Non-OECD Europe and Eurasia Latin America
11
. . . and increased liquefaction capacity
70 60
Bcf/d
50 40 30 20 10 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
0
Africa
Australia & New Zealand
Brazil
Latin America
Middle East
Other Asia
Russia
United States
OECD Europe
Global Gas - Oct 28, 2009
12
In the near term, increased export capacity will put downward pressure on gas prices 24 22 20 18 16 14 12 10 8 6 4 2 0
Oil
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
2006 $ / mmBtu
Average wholesale gas prices
China - South Qatar
Europe- North Russia West
Oil Global Gas - Oct 28, 2009
13
Japan US - West South Central
In 2035, we expect a $ 3 – 5 price differential between regions Average wholesale gas prices in 2035 18
2006 $ / mmBtu
16 14 12 10 8 6 4 2 0 China - South Europe- North
Global Gas - Oct 28, 2009
Japan
14
Qatar
Russia West
US - West South Central
