Sometimes pictures really are as valuable as the old saying suggests.
Going through my e-pile this week, I was struck by the image below from the Baker Institute. The picture shows world population (denoted by the white lights from satellite imagery), overlaid with global gas reserves (blue to red zones, representing smallest to largest reserves, respectively).
There's been a lot of talk lately about gas being the "fuel of choice" for our carbon-conscious times. Gas-fired power generally entails lower emissions than oil or coal. Gas has proven less controversial than nuclear. And can provide the baseload power that renewables (with the exception of geothermal) can't.
If we are indeed standing on the verge of another "dash for gas" era, it's instructive to look at where in the world we might find supplies. And more importantly, how we can get the gas to the people who need it.
The first point of note from the map is the location of most of the world's gas-rich regions (the red zones). The hot spots are central and eastern Russia, the "Stans", the eastern Middle East and the North Sea.
Save for the North Sea (a rich, but depleting area), none of these pools are close to major population centers. The bright lights of the eastern U.S., east Asia and India are all fairly distant from the world's major gas-producing regions (although this map is a little dated, and would today undoubtedly show a bright spot in the southern U.S. representing shale gas).
Seeing this, it's easy to understand why we're seeing such a frenzy of pipeline and liquefied natural gas construction today. China is funding hundreds of billions of dollars towards pipeline from Russia, Turkmenistan and Burma. Asian nations are also very interested in LNG developments in Qatar and northern Australia.
Europe is somewhat fortunate to be positioned not only near the North Sea, but also close to North Africa, where Algeria holds substantial gas reserves. Trans-Mediterranean pipelines have been an ongoing project for several years.
The map also suggests some future possibilities. There are large gas reserves off the eastern coast of South America. With large population centers nearby. This bodes well for development companies in Brazil and Uruguay (the latter is seeing its first offshore licensing round this year).
Argentina is also well-endowed, and reasonably well-positioned to meet South American gas demand. The nation's gas industry has been held back by low, government-mandated gas prices, which have gutted development. But a turn-around in government could change that.
The rich gas-fields of Indonesia and Papua New Guinea will likely become more sought after. These pools are remote and high-cost. But they are massive (some recent PNG wells have seen record gas test rates in the hundreds of millions of cubic feet per day), and located a short sail from China and Japan.
West Africa is also a hot spot for reserves. However, with shale gas in America potentially putting a damper on LNG import demand, this region may have lost one of its target markets in the Atlantic. Europe is still a possibility. Keep an eye on Gabon and Angola.
We can say a few things for sure. Gas is going to remain important as a global fuel. And on a global scale, discovering gas is not the main challenge. The trick going forward will be finding economic and politically-expedient ways of moving gas from the red to the white. This is going to require engineering not only of the traditional variety, but also of the social, political and financial type.
By. Dave Forest of Notela Resources