By 2030 worldwide natural gas consumption will have increased 32%, jumping to 153 Tcf compared with 104 Tcf in 2006, according to the Energy Information Administration’s (EIA) International Energy Outlook 2009 (IEO2009).

“With world oil prices rebounding from their early 2009 level, as the world economy recovers from the current downturn, and then continuing to grow in real terms through the end of the projection period, consumers opt for comparatively less expensive natural gas for their energy needs whenever possible,” EIA said. “As a result, natural gas remains a key energy source in the industrial sector and for electricity generation.”

The industrial sector, which consumes more natural gas than any other end-use sector, will continue to do so in 2030, according to IEO2009. The industrial sector will use 40% of the world’s natural gas in 2030, with electricity generation accounting for another 35%, up from 32% in 2006, the report said.

To meet the projected growth in demand, production in 2030 will need to be 49 Tcf higher than in 2006. Approximately 84% of the production increase is expected to come from the countries outside the Organization for Economic Cooperation and Development (OECD), EIA said. The Middle East, non OECD Europe, Eurasia and Asia each will supply about 20% of the increase, while Africa will provide another 15%.

Production from OECD nations is projected to increase by 7.8 Tcf from 2006 to 2030, with the largest increase — 5.3 Tcf — coming from the United States, according to IEO2009. Unconventional natural gas will be the largest contributor to the growth in U.S. production, as rising prices and improvements in drilling technology provide the economic incentives necessary for exploitation of more costly resources. Production from tight sand formations and from shale formations are projected to increase to 56% of the U.S. total in 2030 from 47% in 2006.

In its previously issued Annual Energy Outlook, EIA raised its projection for U.S. domestic natural gas production and demand in the coming decades, citing the continued rapid growth in gas shale development and demand for gas by power generators, but predicted a smaller role for imports of liquefied natural gas in the years ahead (see NGI, April 6). The Department of Energy agency predicts that domestic gas production will increase 22% by 4.3 Tcf/year between 2007 and 2030, while net imports will fall by 3.1 Tcf/year (22%). The EIA sees natural gas demand rising by 0.2% annually during the projection period.

By 2030 total worldwide energy consumption will have increased 44% compared to 2006 levels, with the largest increase (73%) coming from the emerging economies of countries outside the OECD, EIA said.

According to the forecast, total world energy use will increase to 552 quadrillion Btu in 2015 and to 678 quadrillion Btu in 2030 — up from 472 quadrillion Btu in 2005. Those figures are down from predictions EIA made last year, when it said total world energy use would increase to 562 quadrillion Btu in 2015 and to 695 quadrillion Btu in 2030 (see NGI, June 30, 2008). While the current economic downturn dampens energy demand in the near term, with economic recovery anticipated after 2010 “most nations return to trend growth in income and energy demand,” EIA said.

Natural gas, coal and other fossil fuels are expected to continue supplying much of the energy used worldwide through 2030. While liquid fuels will continue to supply the largest share of world energy consumption over the projection period, their share falls from 36% in 2006 to 32% in 2030, as high oil prices lead many energy users, especially in the industrial and electric power sectors, to switch away from liquid fuels when feasible, according to EIA.

The IEO2009 reference case, which assumes current laws and policies remain unchanged throughout the projection period, finds global electricity generation increasing by 77% to 31.8 trillion kWh in 2030 from 18 trillion kWh in 2006. Growth in OECD countries, where electricity markets are well established and consuming patterns are mature, will be about 1.2% annually, while non OECD countries, where a large amount of potential demand remains unsatisfied, will see an average 3.5%/year increase in electricity generation, EIA said.

©Copyright 2009Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.