IEA says gas in 'golden age', but cuts forecast

20th June 2013, Comments 0 comments

The International Energy Agency said on Thursday that natural gas was enjoying "a golden age" even if the growth in output over the next five years will be a lower-than-expected 2.4 percent instead of 2.7 percent forecast earlier.

The IEA's Medium-Term Gas Market Report pointed out that shale discoveries in North America and China's attempts to ease its reliance on polluting coal were boosting the relatively clean energy resource's prospects.

"Even though we have revised our growth estimates downwards, the 'Golden Age' of gas remains in full swing," said IEA Executive Director Maria van der Hoeven as she presented the report during the Saint Petersburg International Economic Forum in Russia's second city.

"Gas is already a major fuel in power generation, but the next five years will also see it emerging as a significant transportation fuel, driven by abundant supplies as well as concerns about oil dependency and air pollution," she said.

The Paris-based intergovernmental organisation said it foresees the share of gas in the global primary energy mix rising to 4,000 billion cubic metres (bcm) in 2018 from 3,427 bcm in 2012.

But it also conceded that gas faced certain "challenges" in various parts of the world.

It said that rising gas prices may force coal to regain some of its lost share of the market in the United States.

The gas market in Europe meanwhile could suffer as the continent was registering only a "weak and partial" economic recovery while the Middle East was seeing a boom in domestic gas consumption that would put a curb on the region's exports.

The IEA also highlighted a "persistent tightening" of the liquified natural gas market that limits its contribution to the energy mix.

It also observed that Russia -- the world's largest natural gas exporter -- may only preserve its leading status in the future by fostering Asian markets and relying less on its traditional markets in Europe.

© 2013 AFP

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