By Matthew Van Dusen, of Txchnologist (sponsored by GE) The international gas scene has changed rapidly in the last few years. State-owned and affiliated gas companies that used to exercise outsize influence on captive markets (think of the seemingly neverending dispute between Russia’s Gazprom’s and Ukraine’s Naftogaz that left Eastern Europeans shivering) have been laid low by the global recession and surging shale gas production. Meanwhile, the U.S., the world’s biggest gas consumer, dethroned Russia in 2009 to become the world’s biggest gas producer. U.S. imports are down, exports are up, and prices are at historically low levels. Still, major exporters see blue sky on the horizon. The move away from nuclear energy in Europe and Japan as a result of the partial meltdown at Fukushima has boosted exports in the short-term and is expected to have a longer term effect. Meanwhile, major gas producers hope a recovering economy and a switch from coal power plants to lower-emission natural gas plants will also stimulate demand. Here’s a look at the top exporters of natural gas and the challenges they face. Russia 2009 Exports: 6,466 billion cubic feet The king of natural gas has been sitting on a shaky throne. European demand tanked during the recession, forcing Gazprom, the majority state-owned gas monopoly, to curtail its plans to develop some fields. The cartel formed by Russia and other major exporters, the Gas Exporting Countries Forum, is widely viewed as an ineffective OPEC lite. But instability in North African countries, coupled with Germany’s move away from nuclear has Gazprom forecasting a recovery in demand by 2013. Norway 2009 Exports: 3,492 billion cubic feet Norway’s major oil company Statoil — another majority state-owned concern — pipes large quantities of natural gas to utilities in the United Kingdom, Germany and other European countries. It also ships liquefied natural gas to the United States and others. Statoil has been aggressively promoting natural gas for electricity generation as European countries turn against nuclear power. Canada 2009 Exports: 3,257 billion cubic feet Canada is the single largest external supplier of natural gas to the U.S., with pipelines from the north bringing 88 percent of all imports in 2009. Like the U.S., Canada has seen a boom in gas reserves and production as a result of shale gas finds. Unlike the U.S., Canada produces more gas than it consumes and several companies are considering building LNG export terminals to supply Asian markets. Qatar 2009 Exports: 2,408 billion cubic feet Described by The Economist as “the world’s LNG powerhouse,” Qatar has for years built infrastructure to ship LNG to the U.S. But the export market is proving to be more problematic than the tiny Emirate expected: the U.S. market for LNG has been declining for years. Meanwhile, European countries have been pressuring Qatar and Russia to sever the link between gas prices, which have been low, and surging crude oil prices. But even if Europe walks, Asian markets beckon, particularly China, which is currently constructing 16 LNG terminals. Algeria 2009 Exports: 1,860 billion cubic feet Algeria is the third largest supplier of natural to Europe, providing about 20 percent of the continent’s gas via pipelines to Spain and Italy. The Medgaz pipeline to Spain, partly owned by the state-owned Sonatrach, has a capacity of 283 bcf per year. Algeria has been feeling the same squeeze as other major exporters. Last year, Algerian officials tried, and failed, to convince other members of the Gas Exporting Countries Forum to set production quotas, as OPEC does, after a supply glut led to low prices.
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