CEDIGAZ, the International Association for Natural Gas SUMMARY Natural Gas In The World 217 Edition CEDIGAZ, October 217
NATURAL GAS IN THE WORLD 217 SUMMARY Worldwide proven natural gas reserves grew by.9% year on year to 196,941 bcm as of December 31,216 (+ 1,71 bcm). The largest increase was recorded in the Middle East (+ 947 bcm), under the impetus of strong reserves growth in Iraq (+662 bcm/21%). Worldwide marketed natural gas production edged up.2% to 351.9 bcm in 216, marking an abrupt halt after a gradual growth of almost 2%/year on average over the five previous years. Much of the lacklustre performance can be attributed to the US, where gas production fell for the first time since the US shale revolution began. World gross natural gas production increased by.6% to 4384 bcm in 216. Significant increases were observed in the volumes of reinjected gas (+ 1.2%), flaring/venting (+ 2.2%) and shrinkage (+ 3%). Global production of unconventional gas surged 5.3% to 817 bcm and North America still covers more than 85% of the world total. International natural gas trade accelerated in 216, up 6.2% to 117 bcm, addressing regional imbalances (Europe) and local gas shortages. This expansion was fuelled by both pipeline trade (+ 6.1%) and LNG (+ 6.4%). UGS Working Gas Capacity increased by 2.6% (+ 11 bcm) and stood at 424 bcm on December 31,216 (12% of global gas consumption), driven by expansion in the C.I.S., the Middle East and China. In 216, world actual natural gas consumption (including storage variations) increased at a rate of 1.6% to 3528 bcm, in line with the five year average. In recent years, the role of natural gas in the energy mix has slightly progressed, in a context of falling coal consumption and rising renewable energy production. Weak market fundamentals and low oil prices led to both a reduction in international gas prices and a convergence among regional benchmarks. 2
CEDIGAZ, the International Association for Natural Gas NATURAL GAS RESERVES IN THE WORLD 3
Proved reserves by region 25 Source: Cedigaz Natural Gas Statistical Database 2 NORTH AMERICA MIDDLE EAST EUROPE 15 CIS CENTRAL AND SOUTH AMERICA ASIA OCEANIA AFRICA 1 5 1975 1976 1977 1978 1979 198 1981 1982 1983 1984 1985 1986 1987 1988 1989 199 1991 1992 1993 1994 1995 1996 1997 1998 1999 2 21 22 23 24 25 26 27 28 29 21 211 212 213 214 215 216 * Unless specified, all data in this report are expressed in billion standard cubic meters. 4
Regional share of proved natural gas reserves Source: Cedigaz Natural Gas Statistical Database 8% 6% 6% 4% 2% 41% MIDDLE EAST 33% CIS ASIA OCEANIA AFRICA NORTH AMERICA CENTRAL AND SOUTH AMERICA EUROPE 5
Cumulative proved reserves growth since 26 3 Source: Cedigaz Natural Gas Statistical Database 25 2 15 1 5 AFRICA EUROPE CENTRAL AND SOUTH AMERICA ASIA OCEANIA NORTH AMERICA MIDDLE EAST CIS 27 28 29 21 211 212 213 214 215 216 5 6
Proved reserves (2 largest reserves holders) 6 5 Source: Cedigaz Natural Gas Statistical Database 4 3 2 1 7
CEDIGAZ, the International Association for Natural Gas NATURAL GAS PRODUCTION IN THE WORLD 8
Evolution of marketed production of oil and natural gas in the world 4.5 Gtoe 4. 3.5 3. Oil 211: 74% 216: 72% 2.5 2. 1.5 Natural Gas 2: 6% 1..5. 198: 43% GAS/OIL RATIO OF GLOBAL PRODUCTION 198 1981 1982 1983 1984 1985 1986 1987 1988 1989 199 1991 1992 1993 1994 1995 1996 1997 1998 1999 2 21 22 23 24 25 26 27 28 29 21 211 212 213 214 215 216 Source : CEDIGAZ The global Gas/Oil Production Ratio has fallen in recent years as oil production growth, boosted by US tight oil plays, has surpassed that of natural gas. In 216, it reached around 72%, its lowest level since 21. 9
Evolution of the world balance of gas production 45 4 35 Evolution 198 216 Marketed production 8% Gas reinjected 1% Gas flared and vented 3% Other losses (shrinkage) 7% 3 25 2 15 1 5 198 1982 1984 1986 1988 199 1992 1994 1996 1998 2 22 24 26 28 21 212 214 216 Other losses* Flared & vented Reinjection Marketed production Source: CEDIGAZ * Essentially resulting from the processing of natural gas before it enters the networks, purification and/or extraction of its liquefiable fractions (ethane, LPG, natural gasoline and condensates). This volume includes natural gas used in field and processing plant operations. 1
Recent trends in marketed gas production by region 9 8 7 6 5 211 212 213 214 215 216 4 3 2 1 North America C.I.S Middle East Asia Oceania Europe Africa South & Central America Source: CEDIGAZ In 216, much of the lacklustre performance can be attributed to the US. Robust and steady growth in the Middle East and Asia Oceania. Flat trend in the CIS, Africa and South & Central America. 11
Evolution of marketed production by geographic zone Evolution 26 216: + 2%/year 35 3 25 2 15 1 South & Central America Africa Europe Asia Oceania Middle East CIS North America 5 Source: CEDIGAZ 12
Marketed production by country Top 15 naturalgas producers United States Russia Iran 216 215 Qatar Canada China & Hong Kong Norway Saudi Arabia Algeria Turkmenistan Australia Indonesia Malaysia UAE Uzbekistan Source: CEDIGAZ 1 2 3 4 5 6 7 8 13
CEDIGAZ, the International Association for Natural Gas UNCONVENTIONAL GAS IN THE WORLD 14
Remaining technically recoverable natural gas resources by type and region, end 215 Total resources (Tm3) : 784 Tm 3 Conv. : 434 CBM : 5 Tight : 81 Shale gas : 218 Americas Europe E.Europe/Eurasia Latin America Middle East & Africa Asia Oceania Source: International Energy Agency (WEO 216) based on BGR (215), BP (216), Cedigaz (216), O&GJ (215), US EIA/ARI (213), EIA (215), USGS, IEA databases 15
Unconventional gas production in the world Year 216 China 8% Australia 4% Others 2% CBM 9% Canada 11% Tight gas 35% US 75% Shale gas 56% Source: CEDIGAZ Estimates North America covers more than 85% of global unconventional gas production. 16
Evolution of US dry shale gas production 5 45 4 35 3 25 2 15 1 5 Bcf/d Rest of US 'shale' Permian Utica Marcellus Haynesville Eagle Ford Fayetteville Barnett Woodford Bakken Antrim Source: EIA 17
CEDIGAZ, the International Association for Natural Gas INTERNATIONAL NATURAL GAS TRADE 18
Recent trends in international gas trade (2) LNG Inter LNG Intra Inter Pipeline Intra Pipeline 6 5 4 3 2 1 214 214 215 215 216 216 Source: CEDIGAZ 19
Recent trends in interregional trade Net imports Net exports 3 214 25 214 25 215 2 215 2 216 15 216 15 1 1 5 5 Europe Asia Oceania North America CIS Middle East Africa South & Central America Regional importing markets Regional exporting markets Source: CEDIGAZ 2
International imports by region Total 215 = 142 Bcm Total 216 = 117 Bcm 1% 13% 4% 4% 6% 28% 44% Europe Asia Oceania North America CIS Middle East South & Central America Africa 14% 5% 28% 4% 3% 2% 44% Europe Asia Oceania North America CIS Middle East South & Central America Africa Source: CEDIGAZ 21
International exports by region Total 215 = 142 Bcm Total 216 = 117 Bcm 8% 4% C.I.S. 25% Europe 9% 3% C.I.S. 25% Europe 12% Middle East 13% Middle East Asia Oceania Asia Oceania 14% 15% 22% North America Africa South & Central America 15% 14% 21% North America Africa South & Central America Source: CEDIGAZ 22
Recent trends in international pipeline flows International pipeline flows by importing zone International pipeline flows by exporting zone 45 4 35 3 25 2 214 215 216 3 25 2 15 214 215 216 15 1 5 1 5 Europe North America C.I.S. Asia Oceania Middle East South & Central America Africa C.I.S. Europe North America Africa Middle East Asia Oceania South & Central America Source: CEDIGAZ 23
Evolution of international gas trade: Pipeline versus LNG 1 Pipeline LNG 8 6 From 1996, intra CIS trade is included 4 2 1975 1976 1977 1978 1979 198 1981 1982 1983 1984 1985 1986 1987 1988 1989 199 1991 1992 1993 1994 1995 1996 1997 1998 1999 2 21 22 23 24 25 26 27 28 29 21 211 212 213 214 215 216 Source: CEDIGAZ 24 32%
Evolution of net LNG imports 35 3 25 Middle East, South/Central America & Africa Asia Emerging markets Asia Established markets* Europe North America 2 15 1 5 1964 1966 1968 197 1972 1974 1976 1978 198 1982 1984 1986 1988 199 1992 1994 1996 1998 2 22 24 26 28 21 212 214 216 * Japan, South Korea & Taiwan Source: CEDIGAZ 25
International natural gas flows by main country (1) International imports in the top ten importing countries International exports in the top ten exporting countries 6 5 4 3 2 1 26 27 28 29 21 211 212 213 214 215 216 Germany Japan United States China & Hong Kong Italy France United Kingdom Turkey South Korea Mexico 8 7 6 5 4 3 2 1 26 27 28 29 21 211 212 213 214 215 216 Russia Qatar Norway Canada United States Australia Algeria Netherlands Turkmenistan Malaysia Source: CEDIGAZ 26
CEDIGAZ, the International Association for Natural Gas UNDERGROUND GAS STORAGE IN THE WORLD 27
Evolution of global UGS working gas capacity 45 4 35 Sources: Cedigaz UGS Database, Cedigaz Natural Gas Statistical Database 14% 13% 3 12% 25 2 11% WGC (bcm) WGC/Gas consumption 15 1% 1 5 9% 197 1975 198 1985 199 1995 2 25 21 215 216 8% 28
Regional share of working gas capacity (Total 424 bcm) 5% 2% 25% 3% 38% North America C.I.S Europe Asia/Oceania Middle East Central and South America 29
Working gas capacity by storage type 8% 12% 8% Abandoned mine Aquifer Depleted field Rock cavern Salt Cavern Source: Cedigaz UGS Database 3
CEDIGAZ, the International Association for Natural Gas NATURAL GAS CONSUMPTION IN THE WORLD 31
Evolution of the world energy mix 216 (%share of primary fuels) Nuclear 4.9 Renewables 14.1 Natural gas 21.5 4% 35% 3% 25% Coal Oil Oil 32,4 Coal 27.1 2% 15% 1% 5% % 26 27 28 29 21 211 212 213 214 215 216 Natural gas Nuclear Renewables Source: CEDIGAZ Estimates Over ten years, the share of natural gas in the primary energy mix has gained 1 point to 21.5% In parallel, the share of renewables has risen from 12% to 14%. Coal share has declined significantly from 29% to 27% in the past five years. 32
Evolution of apparent consumption by geographic zone 26 216 : + 2%/year 35 3 25 2 15 1 Africa South & Central America Middle East Europe CIS Asia Oceania North America 5 Source: CEDIGAZ 33
Evolution of apparent consumption in the top ten consuming countries Top 1 consuming countries 2 15 1 5 211 212 213 214 215 216 Source: CEDIGAZ Mexico UAE Canada Germany Saudi Arabia Japan Iran China Russia United States World Total 216 = 352 Bcm 39% 2% 2% 3% 3% 3% 3% 22% 5% 12% 6% United States Russia China & Hong Kong Iran Japan Saudi Arabia Germany Canada UAE Mexico Others 34
Recent trends in actual gas consumption by region Actual gas consumption* 1 9 8 214 215 216 7 6 5 4 3 2 1 North America Asia CIS Europe Middle East S & Central America Africa * Figures differ from apparent consumption as actual gas consumption takes stock changes into account. Source: CEDIGAZ 35
Recent trends in actual gas consumption by economic zone 18 16 14 12 1 214 215 216 37% Total 216 = 3528 bcm 47% 8 6 4 2 16% OECD CIS Emerging markets OECD CIS Emerging markets Source: CEDIGAZ 36
CEDIGAZ, the International Association for Natural Gas INTERNATIONAL GAS PRICES 37
Evolution of international oil and gas prices $/MBtu 212 213 214 215 216 Henry Hub 2.8 3.8 4.4 2.6 2.5 Europe - Average 11.5 11.8 1.1 6.8 4.8 Japan LNG 16.6 16 16 1.2 6.9 Brent 19.3 18.7 17.1 9 7.5 Source: CEDIGAZ, US EIA, Reuters 2 18 16 14 12 1 8 6 4 2 212 213 214 215 216 Henry Hub Europe Average Japan LNG Brent 38
Evolution of international gas prices $/MBtu 2 Europe Average Spot NBP 15 1 Brent 6 M average Japon LNG Japan spot LNG Henry Hub 5 Source: CEDIGAZ, US EIA, Reuters 39
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