(MENAFN- The Peninsula) By Mohammad Shoeb / The Peninsula
The global gas consumption is forecast to increase by 53 percent between 2017 and 2040. This growth will be led by non-OECD Asia, followed by the Middle East and Africa, noted the Secretary-General of Gas Exporting Countries Forum (GECF), yesterday.
Dr Mohammed Hussein Adeli, the outgoing chief of the Doha-based Forum, while sharing the highlights of the GECF's ‘Global Gas Outlook 2017', added: 'Natural gas will become the fastest growing fossil fuel, with an annual growth rate of 1.8 percent, reaching 5,395 billion cubic metres (bcm) in 2040.
World energy demand is projected to grow by 1.1 percent per annum, rising 29 percent between 2017 and 2040, from 13.8 to 17.8 gigatonne of oil equivalent (Gtoe). By 2040, fossil fuels are expected to meet 75 percent of the world's energy demand.
The share of natural gas in the global energy mix will increase from 22 percent in 2016 to 26 percent in 2040. Coal will see a 7 percent decrease (from 27 percent to 20 percent), to be gradually replaced by natural gas, renewables (17 percent) and nuclear (6 percent). Concurrently, the share of oil in the global energy mix will decrease by 3 percent, to 29 percent in 2040.
Dr Adeli said: 'The demand for gas in the power sector increased from 692bcm in 2000 to 1,280bcm in 2016, with an annual average growth rate of 3.9 percent. This represents 36 percent of the gas consumed in all energy sectors in 2016. The GECF expects that consumption in the power sector will continue to increase by an average growth rate of 2.5 percent per annum, reaching 2,329bcm in 2040.
The Secretary-General noted that markets are liable to experience a significant transformation through to 2040. In 2017-2018, global growth will be supported by several emerging economies that have entered the recovery phase. Commodity markets are rebalancing after a period of increased volatility. Global GDP is expected to grow by 3.7 percent over the next five years, a slight upswing from the 3.4 percent seen over the previous five years.
In the long-run, population growth and household wealth are strong drivers for energy demand transformation. The global population will reach 9.2 billion by 2040, witnessing an increase of 1.7 billion from today. This substantial population increase is paired with an 80 percent projected increase in average GDP per capita relative to current levels.
Dr Adeli also highlighted that demographic and socioeconomic trends will catalyse energy demand both directly and via the industrial sector, with the number of households totalling 2.8 billion by 2040, a 33 percent increase from 2017. Furthermore, a growing population with more access to wealth will drive vehicle fleet expansion by 60 percent, with 2 billion cars on the road by 2040.
Energy accessibility will become a top priority in the long-term. Most population and income growth will come from Asia and Africa. These two regions currently have the poorest access to energy and the largest fuel substitution potential.
Growing demand for electricity will be one of the major drivers of the gas consumption. Global electricity demand has been increasing since 2000 and is projected to peak at 41,235 terawatt hours (TWh) in 2040. Rapidly expanding production and trade of pipeline gas and, especially, liquefied natural gas (LNG) has been observed in recent years.
In 2016, global trade of LNG totalled 257.7 million tonnes (MT), a 15 MT increase from the previous year.
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