The Middle East is set to spend up to $120 billion to boost natural gas production by more than 19% by 2030, according to energy consultancy Wood Mackenzie.
Natural gas output from the region will rise to 86 billion standard cubic feet (bcfd) a day by the end of the decade, from 72 bcfd currently, it said in a report last week.
The expected increase in production is equivalent to the gas consumption of the entire European power sector and could help energy companies solve the energy trilemma of sustainability, security and affordability, the report said.
“The Middle East can be part of the solution for the global gas markets as the region continues to ramp up production from its gigantic gas reserves,” said Alexandre Araman, principal analyst for Middle East Upstream at Wood Mackenzie.
Around half of the 14 bcfd increase will be made available for export, which could have a game-changing effect on the global gas markets, especially as the LNG liquefaction capacity in the Middle East keeps growing. The other half will be absorbed by domestic demand growth.
“To fulfil the level of production growth that we have predicted, investments in non-associated gas projects are set to reach a record $25 billion this year and a cumulative total of $120 billion by the end of the decade.”
Qatar LNG exports should reach 126 million tonnes per annum (mmtpa) by 2030, while Abu Dhabi should be able to export 15.4 mmtpa after its new LNG facility comes onstream in 2028.
The report adds that for international companies, gas projects in the region present attractive opportunities. Gas accounts for barely 35% of their Middle East production mix but generates more than 70% of the value. Fifty per cent of the value figure is created in the global LNG powerhouse of Qatar by three companies: ExxonMobil, Shell and TotalEnergies.
(Writing by Brinda Darasha; editing by Seban Scaria)