Mondiu Jaiyesimi: Key players in the global gas market – Facts and analysis (Y! Policy Hub)

by Mondiu Jaiyesimi

Mondiu Jaiyesimi new

Natural gas releases 30% and 40% less carbon dioxide than crude oil and coal respectively which makes it a more efficient option for consumers and policy makers.

The global economy is fast becoming aware of the importance of energy efficiency and the negative impact of carbon emission. This is one of the reasons natural gas is the fastest growing fossil fuels at 2.0% per annum according to the BP World Energy Outlook 2030. Natural gas is also seen as a bridging fuel from carbon intensive fossil fuels to renewables which will look to gain a considerable share in global energy mix in the next 50 years. Natural gas releases 30% and 40% less carbon dioxide than crude oil and coal respectively which makes it a more efficient option for consumers and policy makers. This study provides a brief breakdown of the current top ten players in the natural gas market today with more emphasis on proved reserves.

1. Iran
Iran is home to the world’s biggest gas field- South Par Gas field which holds approximately 27% of Iran natural gas reserves producing 325 trillion cubic meters (tcm hereafter) of gas. According to the EIA, 59% of Iran’s gas is consumed locally more than oil which comes at 39%. According to BP Statistical bulletin of world energy 2013, Iran is ranked as the biggest holders of natural gas reserves with 33.6 trillion cubic meters. It is however ranked as number three in the world in natural gas production due to various factors. The controversial nuclear programme which led to international sanctions and lack of foreign investment are the few reasons affecting Iran’s natural gas development. However, the Iranian government has now been courting eastern oil giants after the divestment plans from western oil companies like Shell and Total. The country is projected to increase gas production to 10.9 trillion cubic feet by 2020.
2. Russia

Fig. 1.1 Data source: BP Statistical Bulletin of World Energy 2013
Figure 1.1 above puts the importance of Russia’s gas to Europe into perspective. The country holds 32.9 tcm gas reserves and currently produces 592.3 billion cubic meters (bcm hereafter). According to BP’s Energy Outlook 2030, Russia will remain the largest energy exporter as it also holds the world’s ninth largest crude oil reserves. The EIA also describes it as the largest producer and exporter of dry natural gas.
3. Qatar
Qatar is the second largest natural gas reserves holder in the Middle East behind Iran with 25.1 tcm in gas and producing 157.0 bcm in 2012. More significantly, it is the world’s largest supplier of Liquefied Natural Gas (LNG), a business it only begun 16 years ago. Figure 1.2 shows that Qatar holds 31% of the total 80.5 tcm of gas reserves in the Middle East.

Fig. 1.2 Data source: BP Statistical Bulletin of World Energy 2013

4. Turkmenistan

Fig. 1.3 Data source: BP Statistical Bulletin of World Energy 2013
Figure 1.3 shows Turkmenistan as the 4th largest natural gas reserves holders in the world. It holds 17.5 tcm ranking second in the whole of Europe and Euro-Asia. The World Bank describes it as an upper middle income country with a population of 5.2 million people (2012) and a GDP of $33.68 billion. The country’s gas reserves witnessed a sharp increase between 2002 and 2012 from 2.3 tcm to 17.5 tcm which represents an 86.9% increase. Besides obvious political issues, another challenge facing the country’s gas industry is the further development of infrastructure to enhance exports. Nonetheless, the country is still currently ranked as the 11th biggest producer of natural gas in the world at 64.4bcm.
5. United States
The United States witnessed a steady increase in its gas reserves between 1992 and 2012. Figure 1.4 shows an increase of 80.1% within this period and one of the key reasons is the discovery and commercialization of shale gas. The United States has now eclipsed Russia as the biggest producer of Natural gas with 681.4 bcm and forecasts have shown that the United States is set to become a key net exporter of natural gas after reducing net import by 23% in 2012.

Fig. 1.4 Data source: BP Statistical Bulletin of World Energy 2013
6. Saudi Arabia
The most important country in crude oil reserves and production, it is also the key driver of OPEC’s annual crude oil supply. Saudi Arabia is also a significant player in the gas market as it holds the 6th largest natural gas reserves standing at 8.2 tcm and produced 102.8 bcm at the end of 2012.
7. United Arab Emirates
The UAE is fast maintaining a well diversified economy and is one of the richest countries in the world with a GDP per capita ranking among the top 20 in the world at $40,336 according to the World Bank. It is ranked 7th in the world in both natural gas reserves as figure 1.3 above depicts. .

8. Venezuela
In terms of natural gas abundance, Venezuela is the leading country in South and Central America. Figure 1.8 below shows that it approximately holds 75% of all of the gas reserves in South and Central America with 5.6 tcm out of a total of 7.6 tcm.

Fig. 1.5 Data source: BP Statistical Bulletin of World Energy 2013
Note: Others*- Other South and Central American countries
9. Nigeria
Nigeria is one of the most important countries in global oil and gas market. Production disruptions and other crises in the Niger Delta since 2002 have always impacted already volatile oil prices. The proposed Petroleum Industry Bill (PIB) and political instability have affected further investment in oil and gas infrastructure from western oil giants. With that being said, Nigeria still has the largest proved natural gas reserves in Africa and 9th in the world closely followed by Algeria. Figure 1.6 shows the abundance natural gas in Nigeria and Algeria relative to the rest of the continent with a combined total of 9.7 tcm out of Africa’s 14.5 tcm share of global gas reserves. On production, Nigeria is ranked among the top 20 producers in the world as shown in figure 1.7.

Fig. 1.6 Data source: BP Statistical Bulletin of World Energy 2013

10. Algeria
Algeria is the biggest producer of natural gas in Africa and 8th largest in the world producing 81.5 billion cubic meters in 2012. It is also OPEC’s biggest member country and has the third largest gas field in the world – Hassi R’Mel. State owned Sonatrach is the country’s leading energy company controlling approximately 80% of the energy potentials available.

Fig. 1.7 Data source: BP Statistical Bulletin of World Energy 2013
Note*- Nigeria is ranked 17th in the world.

Other Major Producers
Norway and China are ranked 5th and 6th in the world respectively in gas production. Indonesia is ranked at 9th with an annual production of 71.1 bcm while Malaysia closed 2012 as the 10th biggest producer with 65.2bcm.
Sources: BP Statistical Bulletin of World Energy 2013, OPEC, World Bank Data Bank and the US Energy Information Administration.

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Mondiu Jaiyesimi is an Energy Economist passionate about energy and public policy, empirical research and energy finance. He studied Energy Economics and Policy at the University of Surrey and has done extensive research work in Liquefied Natural Gas markets, UK energy markets, shale gas revolution and energy demand in developed countries.

He currently engages in independent energy consulting focusing on energy modelling, climate change and trends in oil and gas supply in Africa and other emerging markets. He is a member of the International Agency for Energy Economics and the British Institute of Energy Economics.

 

Op-ed pieces and contributions are the opinions of the writers only and do not represent the opinions of Y!/YNaija.

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