The world has entered a "golden age of gas" thanks to the growth of LNG, with current prices set to ensure supplies penetrate Asian markets and particularly India, International Energy Agency executive director Fatih Birol said Monday.
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Speaking at the Baker Hughes AM2020 conference in Florence, Birol recalled a prediction by the IEA nearly a decade ago that a "golden age of gas" was imminent.
"We said the golden age of gas can be materialized through LNG, and it is what we are seeing today," Birol told the audience in Florence.
"At the current price levels, which we think will be with us for at least a few years to come, LNG will penetrate the Asian markets," he said.
"There's a big opportunity there, huge opportunity, many countries bringing new LNG to the markets -- again the US taking the lead, but also from Qatar, Australia, Canada. We see LNG is making major inroads."
While electricity generation will drive future demand, it will not be the biggest driver of gas demand growth, Birol said.
"The main driver is gas use for industry: food processing, textiles, fertilizers -- they are the drivers," he said, predicting the IEA may have to revise higher its gas demand estimates for India in the light of government policy there.
Birol said investment in both oil and gas would continue to be needed, despite energy transition efforts. With the industry investing $330 billion annually in upstream oil and gas at present, even the IEA's most optimistic scenario for a transition to lower emissions and limited climate change entails annual upstream investment of $300 billion, to offset field declines, he said.
The industry's ability to retain its social "license to operate" in the face of public concern would depend partly on its willingness to rein in emissions from the upstream production process, which currently account for around 15% of all global emissions, he said.
"The world will need oil and gas for several years to come, but all the oil and gas industry should understand: no oil and gas company will be unaffected by clean energy transitions."