The Middle East and North Africa (MENA) region is a gold mine waiting to happen. It is reported that the MENA gas wealth could last over 30 years. That is encouraging news for the region. Major Gulf players and other hydrocarbon producers in MENA have around 88 trillion cubic metres of proven natural gas deposits. This can sustain the region for the next 3 decades.
“For a production growth of 6.9 per cent a year, which corresponds to the last 10‐year average, future volumes from remaining reserves would last 33 years.This is just above the conventional 30‐year time horizon for strategic planning in the field of exploration and development (E&D),” Apicorp’s senior consultant Ali Aissaoui said in a five-page study sent to Emirates 24/7.
However, it should be noted that, though gas reserves in some MENA countries are quite high due to undiscoverable resources, reserves in other countries are depleting at an accelerated speed, due to rapid rise in domestic demand.
According to the Saudi-based Arab Petroleum Investment Corp (Apicorp), an affiliate of the 10-nation Organization of Arab petroleum Exporting Countries (OAPEC), the undiscoverable gas deposits in the region are estimated at 26.6 tcm.
The proven reserves account for nearly 42 per cent of the world’s total gas wealth and most of them are based in the UAE, Iran, Qatar, Saudi Arabia and Algeria.
“Our findings confirm and extend our previous results showing that on an aggregate MENA proven reserves are substantial and their combined dynamic life is a little beyond the traditional 30‐year strategic planning horizon for Exploration & Development (E&D)” Aissaoui stated.
This fabulous news comes with a disclaimer. Aissaoui warned that the reserve depletion, in more than half the countries listed, has reached the critical limit or is almost there. Thereby he states that drastic actions are required to curb the demand and supply response.
“As the opportunities available will be increased by unconventional gas, they will entail significant challenges confronting the region’s natural gas paradox ‐ a paradox of scarcity amidst plenty – requires both a demand and supply response,” Aissaoui stated. “As far as the supply side is concerned, MENA policy makers need to rethink critically abpit their E&D policies and the corresponding economic incentives.”
Demand is unlikely to reduce anytime in the future. Thereby the opportunities to meet the ever increasing demand should be driven by a vast potential reserve expansion. He says the potential appears to be the greatest in Iran, Saudi Arabia and Qatar. Followed by Iraq, the UAE and Algeria. Prospects also seem favorable in Egypt, Oman and Libya, he said.
“MENA has got healthy gas for next 30 years! Halleluiah!” said James Mathews an environmentalist from New Hampshire. “The U.S. has been consuming gas like it’s the end of the world. Now we can sleep peacefully knowing that more land would be exploited to feed the ever craving demand for gas. The problem with such news is that these countries might end up over exploiting their land to increase their petro-dollars. It is not healthy for mother earth.”
Aissaoui’s figures showed Iran had around 33.1 tcm of recoverable gas deposits at the start of 2012 while they were estimated at 25 tcm in Qatar, 8.2 tcm in Saudi Arabia, 6.1 tcm in the UAE, 4.5 tcm in Algeria, 3.6 tcm in Iraq, 2.2 tcm in Egypt, 1.8 tcm in Kuwait, 1.5 tcm in Libya and around 0.9 tcm in Oman. Undiscovered deposits were put at 12.8 tcm in Saudi Arabia, 5.9 tcm in Iran, 0/92 tcm in Algeria, 0.81 tcm in the UAE, 0.77 tcm in Qatar, 0.63 tcm in Oman, around 0.39 tcm in Libya and 0.38 tcm in Egypt.
“Uncle Sam would be looking out for more nuclear weapons in the whole MENA region,” Sarah Mohammad, a law student in Dubai told Arabian Gazette. “All these years they have been invading countries in the Middle East on the pretence of nuclear weapons to obtain access to huge reserves of oil. Now, the White House would be planning and plotting to invade the whole of the MENA.”
Ironically people were angry to note that MENA had more reserves to sustain the future. Mahmood Jamsheed an environmentalist based in UAE said that the U.S. would be the first to encourage over-mining to feed its belly. Mohamamd Anas an engineer from Ajman said that this would make the MENA countries more dependent on petro dollars, they might even ignore the well being of their people. Over-mining for gas would affect the fertility of the land and the overall health of the people.
“The gold rush the U.S. of the 1920’s would be recreated in the MENA region,” Samuel Peterson a historian told Arabian Gazette. “However, the gold rush of the 20’s was driven by the Americans, in the case of the MENA region it would be possible that the MENA Gas Rush would be driven by poor expats from other parts of the globe.
There were some optimistic response as well. “Any future recession would not harm the MENA,” Mahmood Jinnai told. “Additional petro dollars mean better health care for the people, better education, better infrastructure,” a writer based in Baghdad told Arabian Gazette. “Iraq is in need of better times. Iraqi children need a brighter future. If it is to come to us through more gas then so be it!”
What is your take on this story? Do you think MENA countries are doing enough to diversify their economies and hence better prepared for tomorrow? We would love to know your expert comments!