LNG demand to grow by 36 percent, share in energy mix to increase to 26% – Global Gas Outlook 2050
The global demand for natural gas has been projected to grow by 36 percent, while its share within the energy mix is expected to increase from 23%, in 2023, to 26% in 2050 (the highest of all hydrocarbons).
This was parts of the key message contained in the 7th edition of the Gas Exporting Countries Forum (GECF) Global Gas Outlook, 2050, launched the latest edition of its annual Global Gas Outlook 2050 at its headquarters, in Doha, Qatar, on Monday.
Gas Exporting Countries Forum (GECF) is an intergovernmental organization comprising 19 Member Countries of the world’s leading natural gas producers including Nigeria, Algeria, Bolivia, Egypt, Equatorial Guinea, Iran, Libya, Qatar, Russia, Trinidad and Tobago, and Venezuela.
EnergyDay gathered that the Outlook was released on the sideline of drastic transformations affecting physical flows, investment, trade, and market functioning of the energy markets in general and natural gas markets in particular.
SIX KEY MESSAGES OF THE OUTLOOK
* One of the key messages of the Outlook was that energy demand is expected to rise by 22% by 2050. It revealed that all energy sources and technologies will be required to satisfy the world’s growing energy needs while improving air quality and reducing greenhouse gas emissions.
GECF noted that there is no one-size-fits-all model.
* Another critical message of the Outlook was that natural gas, along with renewables, is expected to play a pivotal role in the future, adding that gas will be required for decades to come to satisfy the energy needs stemming from a growing population, an expanding economy, and the quest for higher standards of living.
The Outlook suggested that the use of natural gas – the cleanest burning hydrocarbon- contributes to mitigating indoor pollution and deforestation, improving air quality, reducing greenhouse gas emissions, providing backup to variable and intermittent renewables, and last but not least, ensuring food security as a key ingredient in the production of petrochemicals and fertilisers.
It revealed that by 2050, natural gas demand is expected to grow by 36%, and its share to increase from 23% today to 26% in 2050 (the highest of all hydrocarbons)
GCEF further noted that under the accelerated decarbonisation scenario, natural gas demand continues to grow, albeit at a slower pace.
* The third key message of the Outlook considered that accelerated decarbonisation of the energy systems requires rapidly scaling up many of the existing clean energy sources and technologies: wind and solar, coal-to-gas switching, carbon capture, utilisation and storage, blue and green hydrogen, and modern biomass.
It further hinted that this could more than halve carbon dioxide emissions from the energy sector by 2050 compared to the reference case. However, this requires policy support, fiscal and monetary incentives, and appropriate market design.
* The fourth message of the Outlook was that there is no alternative for Africa but to use its natural resources to alleviate poverty and pursue socio-economic development.
It stated that Africa’s population is set to rise from 1.4 today to 2.5 billion in 2050, and its economy from US$ 2.5 trillion to US$ 7.1 trillion in 2050.
According to Outlook, about 900 million people in Africa still lack access to clean cooking fuels and 600 million to reliable electricity. African communities suffer from the adverse impacts of climate change, despite being the least responsible for it.
GECF noted that the narrative that Africa should not develop its natural resources, particularly natural gas, is misguided, insisting that a prosperous Africa will be more capable of protecting its environment.
The Forum in the Outlook further suggested that the right of Africa to develop its vast natural resources shall thus be preserved, and its access to finance and technology shall be facilitated.
* The fifth message was that investment is critical for energy resilience, affordability, and security. By 2050, the cumulative upstream and midstream investment required to satisfy global gas demand will reach a hefty US$ 10.5 trillion.
*The sixth message of the outlook suggested natural gas trade will expand by more than a third, led by LNG, which will overtake pipeline trade by 2026.
Eng. Mohamed Hamel, Secretary General of the Gas Exporting Countries Forum (GECF) during the lunch of the Outlook on Monday, said that recent geopolitical developments have prompted policymakers to place energy security at the top of the priorities list, and the adoption of policies and regulations that impact the future of energy.
According to him, Inflation, tight financial conditions, disrupted supply chains, expanded economic restrictions, and alteration of the price discovery function of centrally cleared energy exchanges are other examples of elements that affect the medium to long-term energy outlook.
He further revealed that investment in natural gas is part of the solution to the trilemma of affordability, security, and sustainability over the short- to long-term.
He emphasised that all energy sources and technologies will be required to satisfy the world’s growing energy needs while improving air quality and reducing greenhouse gas emissions.
HE Hamel said: “The uncertainties have never been so large, and the challenges so profound. What is nevertheless clearer, and more crucial is the steps that should be taken to ensure that energy is available for socio-economic development, while concurrently protecting the environment?”
Gabriel Lima, President of the GECF, who doubles as the Minister of Mines and Hydrocarbons, Republic of Equatorial Guinea in his remark said that GECF Global Gas Outlook 2050, has become over the years an essential consultation tool for the natural gas industry, governments, academic institutions such as universities and for the general public.
The GECF in the document examined the global and regional economic growth prospects, demand and supply of energy, natural gas trade and investment, the effects of policies, technological developments, and various other drivers.