Accelerated reforms and focused policies aimed at increasing the role of gas and renewables in the energy mix combine to improve the natural gas demand outlook of China and India.
As natural gas in China and India hardly competes with coal on a cost-basis, the substitution from coal to gas requires a strong support of policies and a fast pace of reforms. Past natural gas developments since 2000 in these two markets show very different trends, which attest to the key role of policy measures to support gas demand and supply.
In Cedigaz Scenario, substantial domestic production growth and the expansion of pipeline and LNG infrastructure will bolster growth in gas consumption across various sectors in India and China. Cedigaz prospects for gas demand in these countries are among the highest in the forecast ranges of the different institutions. Cedigaz integrates the objectives of China’s national energy plans. However, for India, natural gas demand projections and the share of gas in the energy mix fall short of the government’s ambitious targets. Cedigaz Scenario is also based on favourable assumptions as regards the advancement of market-oriented reforms in both the gas and electricity sectors.
Algeria is facing a new crossroad as its political and socio-economic balance has become increasingly weakened by the consequences of the oil price collapse since 2014. Algeria is faced with stark choices, as illustrated by the interplay between its energy sector and its political & economic challenges and opportunities. Budgetary constraints are putting pressure on its key hydrocarbon industry, which was already suffering from years of underinvestment due to tough fiscal terms, challenging business climate and security risks.
The North African nation needs to intensify efforts to revive its oil and gas upstream sector with new projects, avert the long-term production decline at mature fields, whilst meeting growing domestic demand and honoring gas export commitments. The widening fiscal deficit and the rapid erosion of financial buffers since the oil price fell is further increasing the need for foreign capital to boost oil and gas reserves, amid growing competition with other producing nations to attract capital and technical know-how from international oil companies. But the lack of upstream investment is just one of the challenges facing Algiers in its energy sector and beyond.
Shortly after his inauguration in May 2017, the new President of South Korea has unveiled a new energy policy that shifts away from nuclear and coal power and focuses on renewables and natural gas instead. The move responds to growing safety concerns over nuclear power following the 2011 Fukushima accident and a series of earthquakes that hit southern Korea in 2016 and 2017. The energy transformation also responds to rising public hostility to coal power due to worsening air quality. Coal burning is also the main source of greenhouse gas emissions in the country, which has committed to reduce its emissions by 37% by 2030.