Natural gas utilization is expected to increase at an average annual growth rate (AAGR) of 2.4% to 116.91 tcf in 2008, forecast Business Communications Co. Inc. (BCC), Norwalk, Conn.
In a report entitled "The World Natural Gas Business," BCC identified three key categories in the world natural gas business chain: unconventional, LNG, and conventional.
Conventional natural gas represents the biggest category, includes natural gas produced in noncontinuous reservoirs, and can be either associated or nonassociated.
"With the rapid buildup in global gas-fired power generation capacity hinging on future natural gas availability, governments and companies must grapple with the dilemma of a near-term shortfall in gas supply," BCC said.
Environmental concerns are expected to substantially increase gas demand.
Meanwhile, new environmental legislation implemented the last 3 years has affected gas demand patterns, the report added.
BCC noted that current high gas prices have prompted questions about whether the projected increase can be sustained by conventional gas supply.
"This has led producers to reconsider the role of unconventional gas in their exploration and development portfolios. The unconventional natural gas category (coalbed methane, gas shales, tight sands, and landfill) will continue to post double-digit growth over the forecast period. Over the next 5 years to 2008, demand for unconventional natural gas will increase at an AAGR corresponding to 10.7%, aided by prioritized research and development efforts," BCC said.
Demand categories
LNG demand will accelerate by an AAGR of 7% during the next 5 years, the report said.
"This growth is due to a rekindling of interest in LNG imports due to higher US natural gas prices in recent years and technological advances that have lowered costs for liquefaction and regasifying, shipping, and storing LNG," BCC said.
Conventional gas demand is expected to reach 95.76 tcf in 2008 from 90.16 tcf in 2003, representing an AAGR of 1.2%.
"The availability of gas gathering and transmission infrastructure in remote locations has had the desired effect of reducing the venting and flaring of natural gas, and by 2008, all major oil and gas companies aim to achieve zero flaring [or] venting of natural gas," BCC said.
