ASIA TO PACE GROWTH IN WORLD ENERGY DEMAND
Asia's developing countries will be the focal point during the next two decades for major producers and suppliers of energy.
A study by DRI International Energy Services, Paris, shows energy demand for developing Asian countries will virtually triple between now and 2015. That suggests "tremendous profit opportunities" in electrical power, oil, and gas.
During the next 20 years, energy consumption in developing Asia will grow at a compound 4.3%/year, driven by fast, sustained economic growth in the region and constant improvement in living standards, DRI said.
With energy demand growth expected to be nearly four times faster than the growth in industrial countries, developing Asia will account for half of the world increase in energy consumption between now and 2015. As a result, DRI projects that developing Asia's share of the world energy market will rise from 17% today to 28% by 2015.
CHINA NO. 1
DRI forecasts that about 40% of the total increase in developing Asia's energy demand will occur in China, making it the major source of regional growth. However, Thailand, Malaysia, and Indonesia will see even faster growth rates in energy demand during the period. Thus they too represent important business opportunities.
Mature economies like Japan will experience slow growth.
Even so, Japan will remain the Asia/Pacific region's second largest energy consumer and its major oil importer. DRI projects that Japan's energy demand will rise an average 1.3%/year between 1993 and 2015. Consequently, Japan's share of the region's energy demand will decline from 22% at present to 13% at the end of the forecast period.
GAS, ELECTRICITY
DRI believes the growth in consumption of gas and electricity will outpace that of other energy sources. As a result, a dramatic surge in gas infrastructure and power generation capacity will have to be built.
China's electricity consumption, for example, will more than triple by 2015, and the country plans to more than double its installed power generation capacity during the next decade. The private sector, which is welcome in most developing Asian countries, will build half of this new capacity.
Developing Asia will become a significant consumer of gas by 2015. Increasing concern about global warming and local air pollution will favor the growth of gas demand.
DRI said developing Asia will need to import gas from new sources such as Oman, Qatar, and Russia, in addition to stepping up development of local resources.
The penetration of this "clean" fuel will be particularly welcome in a region where coal accounts for more than 40% of total primary energy requirements 75% in China.
However, boosted mainly by demand for power generation, coal will continue to play a major role in developing Asia. In particular, the structure of Chinese primary energy consumption, which depends heavily on coal, is not expected to change significantly during the forecast period.
Oil demand in developing Asia also will keep growing, and there will be a widening gap between regional production and consumption.
Granted, new areas such as the Tarim basin of China and several blocks off Viet Nam have been opened to foreign exploration companies. But DRI expects oil imports for developing Asia to triple by 2015.
Several countries will shift from oil exporters to net importers, the most spectacular of which is China. It was predicted to become a net oil importer as of yearend 1993 and to import 3.8 million b/d in 2015.
Current exporters Indonesia and Malaysia will become net oil importers at the beginning of the 21st century.
TRANSPORTATION
DRI expects the transport sector to be the fastest growing source of developing Asia's energy demand in the coming years.
However, transportation's share of total demand will rise only to 23% from 21% as improving fuel economy partially offsets booming demand for all modes of transportation.
Despite continuing strong growth in the region's industrial production, steady gains in energy efficiency will hold this sector's share of total demand to its current 52%.
Countries covered in the DRI report include Australia, China, India, Indonesia, Japan, Korea, Malaysia, New Zealand, Taiwan, Thailand, and a group made up of the remaining countries in the region.
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