US shale gas: the first of five revolutions at the beginning of the XXI century
Three revolutions on the supply side: US shale gas, US shale oil and worldwide renewable
The US shale gas revolution is only the first (and most documented) of three revolutions that happened since the beginning of this century on the supply side. The world has changed thanks to the US shale revolutions (gas first and then oil) and a global quest for renewable. Those revolutions took over a decade but will shape the XXI century. Australia followed producing unconventional gas and is now also exporting it. It should take some time for unconventional oil and gas production to materialize in other places where the resource is available (Argentina, Canada, China, Mexico, Russia, South Africa, etc.) but the US shale revolutions should be exported in a few other countries.
CEDIGAZ, has released today the sixth edition of its reference report on Underground Gas Storage. This updated edition entitled “The Underground Gas Storage & LNG Storage Market in the World 2015-2035” includes for the first time the coverage of LNG storage activity worldwide. The report includes detailed analyses of the latest developments and trends in the storage industry, CEDIGAZ’s Outlook to 2035 at regional and global levels, and extensive country analyses with complete datasets including current, under construction and planned UGS and LNG facilities for more 49 countries.
KEY FINDINGS INCLUDE:
€100 billion to €170 billion Investment Needed in Underground Gas Storage to 2035
Global UGS capacity is expected to increase from 413 bcm in 2015 to between 547 and 640 bcm in 2035. This wide range reflects the uncertainties surrounding the evolution of global gas markets plus the uncertainties specific to the gas storage business, such as challenging geology or the competition from other sources of flexibility. New storage markets, Asia-Oceania, the Middle East, and potentially Central and South America are expected to drive the growth. Conversely, the growth in working capacity should be limited in mature markets, and could even be negative in the EU.
NBP: influenced by the LNG and oil markets
In April, the NBP saw fairly marked fluctuations, ranging from +18% to -10% compared to the monthly average. In a temporary surge, it exceeded €15/MWh ($5/MBtu) on April 26 and 27. A situation of momentarily sustained demand coincided with deficiencies of supply, resulting in heavy recourse to storage. However, monthly averages have been more stable since February, between €12.7-13/MWh ($4.2-4.3/MBtu). The price for early May and the forward quotations for the summer months (until September) stand at about the same levels. Obviously, lower prices cannot be excluded, in light of the market equilibrium conditions. On April 11, the price fell to €11.5/MWh ($3.9/MBtu), its lowest level in recent months, in step with the conditions prevailing on the LNG market in Europe at that time.