CEDIGAZ Insights - Page 6

Oil and Gas Majors in India: Co-creating the Gas and LNG Market – REPORT

Posted in CEDIGAZ Insights, Country Report on

India aims to raise the share of natural gas in the energy mix from 6.5% currently to 15% in 2030. This would lead to a huge growth in LNG imports. But India is one of the most sensitive price markets and needs infrastructure development for natural gas to fulfil its development potential. To address these challenges energy majors are moving downstream to get closer to the final users. COVID-19 has introduced an additional uncertainty to natural gas demand growth but the Indian gas market fundamentals remain robust.

The Indian natural gas market presents a substantial growth perspective. The Indian Government is actively promoting natural gas to diversify its energy mix towards cleaner fuels, reduce oil dependency and tackle air pollution in big cities. The aim is to move towards a gas-based economy and raise the share of natural gas in the energy mix to 15% by 2030 from around 6.5% now. Over the past two years, there has been growing attention on rapidly building out gas infrastructure, including inter- and intra-state pipelines, LNG import terminals, city gas distribution networks to cover over 70% of the population, and CNG/LNG stations across the country. Domestic and foreign investments in the natural sector are likely to amount to $60 billion over the next five years.

Outlook for Indian LNG imports

Source: CEDIGAZ, IEA WEO2019

Iran Natural Gas Report

Posted in CEDIGAZ Insights, Country Report, Natural Gas Market on

Executive Summary of the CEDIGAZ report on the Iranian Gas Chain under US sanctions by Dr Sara Vakhshouri founder and president of SVB Energy International and specialist of the Iranian energy sector

Iran has one of the largest proven natural gas reserves in the world, hosts about 17% of the world’s proven natural gas reserves. Iran is also the world’s third–largest dry natural gas producer after the United States and Russia. About 80% of Iran’s gas reserves are from non-associated gas fields.

Based on Iran’s 6th Five Year Economic Plan (2016-2021), Iran’s rich gas production should reach 474.5 bcm a year or 1300 mcm a day by March 2021. This is almost twice its production of 250.7 bcm in 2016. Despite the upward natural gas output trend, due to sanctions, Iran will not hit its planned production target.

In March 2019, Iran’s processed about 889 mcm/d of rich gas that was produced from independent gas and form oil fields. Rich gas in Iran is processed by NGL factories, gas refineries and dehydration units. The largest share of refined gas production capacity belongs to gas refineries in South Pars.

Despite the fact that Iran is the world’s third largest producer of natural gas, its exports only constitute less than 1% of global gas trade. This is primarily due to its large domestic demand and then because of sanctions on its exports, and lack of investment and access to required technologies.

Iran’s condensate and gas liquid output has soared over the past decade. Most gas liquids are produced in the previously described NGL plants. Nevertheless, the actual production of these units has been less than 50% of their nominal capacity. This was significantly low during the nuclear sanctions and newest round of US sanctions. As a result, Iran has had to offset its oil production and adjust its ability to export. Lower crude oil production had additionally limited overall NGL production volumes, which is the byproduct of crude oil production in Iran.

Tighter US sanctions on Iran energy industry have had a significant and undeniable impact upon Iran’s gas development projects. If US sanctions against Iran continue in the long term, and Iran does not succeed in accessing international capital and technology, it will not increase its natural gas production. In, fact its production levels may start to decrease due to natural decline in South Pars production.

Unlike President Obama’s nuclear sanctions, the current sanctions include condensate export alongside the crude oil export in order to put “maximum pressure” on Iran. As a result of limitations on its condensate export, Iran is struggling to maintain its gas production particularly from South Pars.

Dr Sara Vakhshouri for CEDIGAZ

Complete report available to CEDIGAZ members https://private.cedigaz.org

Get the report (non-members)

A new era for CCUS driven by contrasted policies and business models: US and European approaches

Posted in CCS – Carbon Capture and Storage, CEDIGAZ Insights, Energy Transition, Hydrogen, Zero Carbon Gas on

According to a new report by CEDIGAZ, CCUS is coming back into the limelight, especially in the US and in Europe, in the wake of the Paris agreement, boosted by a growing interest in hydrogen, rising carbon prices, new supporting policies and new business models.

There are currently 20 new, large-scale, CCUS projects planned around the world, nine of them in Europe. While projects developed in the middle of the 2000s mainly targeted coal-fired power plants and stored the captured carbon, the focus of the new projects is different as they tend to concentrate on industrial and manufacturing processes and on carbon utilization rather than just storage. Several projects involve production of clean hydrogen from natural gas, a cheaper option than hydrolysis using renewable power. New business models aim at reducing costs by dis-integrating the CCUS value chain into its three components of capture, transport and storage, and by addressing clusters of industrial facilities to achieve economies of scale.