Johannesburg, South Africa: The growth of unconventional gas is spreading across the world with major implications over many years for markets and prices according to a new World Energy Council study, “Unconventional gas, a global phenomenon”, which looks at where and how fast the revolution is taking place.

Sharing this information through an official communique, World Energy Council said that the study, developed with project partner Accenture Strategy, reveals that despite an uncertain price environment, the magnitude and speed of change is not only influencing the United States market but also other markets, including countries, such as China, Argentina and Algeria, which have similar potential as the United States in shale gas production. Also, countries such as Mexico, Saudi Arabia, South Africa, Poland and Turkey are mentioned in the study as having significant potential for shale gas development.

 The study, said World Energy Council, identifies three emerging global trends:

Shifting portfolio allocations, international growth of unconventional gas operators and interconnected markets.

According to the report, lower oil prices and weakened Asian demand has resulted in the virtual disappearance of the price spread between the Japanese LNG and the UK markets in 2016. Additionally, the US prices remain depressed due to the continued build-up of domestic supplies, the report said.

In order to realise the full potential of the global gas phenomenon, the study reportedly highlights the need for decisive interventions like the following, to alleviate uncertainty in the market:

Industry: Bring a higher degree of focus to portfolio allocation, risk management, and efficiency and continue to seek new and innovative investment partnerships to deliver projects.

Policymakers: Establish policies that promote a liquid market and competition needed for security of supply and the formation of clear price signals.

Consumers: Evaluate the economic and environmental benefits of diversifying energy assets with natural gas in power, industry, transportation, and chemicals and consider innovative investment partnerships to secure supplies.

In addition, the study points out that there are also society and environmental concerns which national oil companies are best placed to address, and thereby puts them in a prime position to take advantage of growth opportunities.

“Unconventional gas is causing a shift in the dynamics of the natural gas market, which will be felt for many decades to come,” said Christoph Frei, Secretary General of World Energy Council.

Frei believed that the rapid growth in unconventional gas has already significantly disrupted global trade flows, and highlighted that unconventional gas will continue to be a key factor in how the world energy market develops.

World Energy Council revealed that “Unconventional gas, a global phenomenon” is one of 15 Knowledge Networks studies for the World Energy Resources flagship study, which will be presented at the 23^rd World Energy Congress in Istanbul, Turkey in October 2016.

Note: Readers can access the paper at: https://www.worldenergy.org/publications/2016/unconventional-gas-a-global-phenomenon/