Middle East gas consumption more than production: IEA

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The International Energy Agency (IEA) said on Tuesday that demand for natural gas in the Middle East is registering a rise that will outstrip supply over the next five years, forcing the resource-rich region to import more.

The international watchdog expected Middle East gas consumption to rise by 79 billion cubic meters (bcm) or 20% from 2011 to 2017. Low gas prices encourage consumption and discourage production, the agency noted.

“Middle East gas production is expected to serve exclusively the regional gas market needs in the medium term …Exports from the Middle East are expected to remain flat,” the Paris-based body said which devises energy policies and maintains statistics on consumption.

Except Qatar, which is the world’s biggest liquefied natural gas exporter (LNG), the IEA said countries in the Middle East region will have to either curb demand or import gas which will be a lot more expensive.

“Natural gas demand grows more rapidly than internal production, forcing countries to import either LNG or pipeline gas from other regions. In a few countries, gas demand has therefore to be curtailed,” the report said.

According to IEA estimates, gas demand in the Middle East is set to rise from around 389 billion cubic meters (bcm) in 2011 to 468 bcm/year in 2017, while regional gas production is likely to grow from 516 bcm to 588 bcm.

Even the 79 bcm additional gas supply forecast is contingent on the successful development of relatively expensive new gas fields, the IEA said.

“The single biggest uncertainty for this growth is the successful ramp-up of gas production across the Middle East,” the agency said while expressing doubts over the speed of development of reserves in Iraq and Iran.

A recent report issued by the International Group of Liquefied Natural Gas Importers, or GIIGNL, a Paris-based lobby group, said rising local demand for power generation is forcing Qatar, Oman, Yemen and Abu Dhabi, suppliers of around 40% of the world’s LNG, to cut exports for the first time in 20 years.

The International Group of Liquefied Natural Gas Importers (GIIGNL) said in its annual report published on 17 May that the four Middle East LNG producers exported 95.6 million metric tons last year. They have a combined liquefaction capacity of 100 million tons, it added.

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