International Gas Union

O t iti & Ch ll f th GO t iti & Ch ll f th G

55thth Asia Gas Partnership SummitAsia Gas Partnership Summit

Opportunities & Challenges for the Gas Opportunities & Challenges for the Gas Industry in AsiaIndustry in Asiayy

Datuk Dr. Abd. Rahim Hj. HashimVice President of IGU,

Vice President of Research & Technology Division of PETRONAS

Taj Palace Hotel, New Delhi, 14 15 April 200814-15 April 2008

AgendaAgenda08/04/2008

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About IGUAbout IGUAbout IGUAbout IGU

Overall Gas OutlookOverall Gas Outlook

Gas Outlook in Asia

Challenges & Opportunitiesg pp

IGU represents around 95% of world wide IGU represents around 95% of world wide gas sales gas sales

Members Non Members

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Members Non Members

68 Chartermembers(67 countries)

IGU serves as a spokesman for the gas IGU serves as a spokesman for the gas industry world wideindustry world wide

f ( )

yy

World wide non–profit organisation (77 years)

Promotes technical and economic progress of the gas industry

Different types of membership and co-operationsyp p p

Charter members

Associate membersAssociate members

Affiliated organisations

Supporters

Fee for Charter- and Associate Members € 4,500

IGU offers various benefits to its membersIGU offers various benefits to its members

P tiNetworking

Promotion

Knowledge

InformationInformation

Experts from all over the world are Experts from all over the world are represented in the technical teamrepresented in the technical team

President Ernesto Lopez Anadón

pp

Ernesto Lopez AnadónArgentina

Secretary GeneralTorstein IndrebøNorway

Vice President Datuk Rahim HashimMalaysia

Roberto BrandtArgentina

CC Chairman

Norway Malaysia

CC SecretaryCC Vice Chairman

Andres KiddArgentina

Ho Sook WahMalaysia

WOC 2Storage

WOC 3Transmission

TFR&D

PGC CDeveloping

Markets

PGC BStrategy,

Economics& R l ti

PGC DLNG

WOC 4Distribution

PGC ASustainable

Development

WOC 1Exploration &

Production

WOC 5Utilisation

TFGas MarketIntegration

& Regulation

J JHelgeWolf

Germany

MarcFloretteFrance

Knut BarlandNorway

VladimirOnderka

Czech Rep.

Mohd. FaridAmin

Malaysia

Pedro Moraleda

Spain

SeiichiUchinoJapan

JeremyBending

UK

VladimirYakushev

Russia

JeanSchweitzerDenmark

JorgeDoumanianArgentina

IGU World Gas Conferences IGU World Gas Conferences every three yearsevery three yearsy yy y

President is elected for a 3 year period; ends its term with the World Gas Conference in its own

tcountry

Argentina 2009: “Reviewing the Strategies for N t l G t d 2030“Natural Gas towards 2030“

3,000 - 5,000 delegates

2003-2006 2006-2009 2009-2012

IGU is spokesman of the gas IGU is spokesman of the gas industry with top class contactsindustry with top class contactsy py p

Organiser ofIGU Gas Research Conferences(IGRC in Paris 2008)

Co-Sponsor of LNG Conferences (LNG 16 in Algiers 2010)( g )

Liaison with UN, IEA and other i i l i iinternational energy organisations

AgendaAgenda08/04/2008

gg

About IGUAbout IGU

Overall Gas OutlookOverall Gas OutlookOverall Gas OutlookOverall Gas Outlook

Gas Outlook in Asia

Challenges & Opportunitiesg pp

The mission is the challengeThe mission is the challenge

Our world needs energy!

Secure, reliable, affordablei ith i i lenergy services with minimal

environmental impactenvironmental impact

”Safe Forecasting””Safe Forecasting”

Population growth from 6 to 9 billion in 2050Population growth from 6 to 9 billion in 2050

Urbanisation continues

Increased level of global prosperity

Times of “easy oil & gas” overTimes of easy oil & gas over

Fossil fuels will dominate next decades

IEA forecasts growing gas demand in the IEA forecasts growing gas demand in the futurefuture

BiomassNuclear

Other renewables16 000

18 000

Gas

Biomass

12 000

14 000

Coal8 000

10 000

Mto

e

Oil4 000

6 000

Oil

0

2 000

1970 1980 1990 2000 2010 2020 20301970 1980 1990 2000 2010 2020 2030

Source: OECD/IEA - 2007

Natural gas reserves are primarily located in Russia & FSU Natural gas reserves are primarily located in Russia & FSU and Middle East, rather far from the gas demand and Middle East, rather far from the gas demand centrescentres

1. INTRODUCTION

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Gas

Gas Production & 35

2,079

Gas Reserves

Gas Production & Consumption

Gas Production & Consumption

15

25

35

258

ConsumptionGas

Reserves

5

15

25

35

90 95 00 03 10 15 20 255

15

25

35

181

Gas Reserves

Consumption

2,571

5

1990

1995

2000

2003

2010

2015

2020

2025North America

199

199

200

200

201

201

202

202Russia & FSU5

1990

1995

2000

2003

2010

2015

2020

2025

Western Europe

1

11

21

31

1990

1995

2000

2003

2010

2015

2020

2025Middle East

22

32

502

21

31

251

2

12

1990

1995

2000

2003

2010

2015

2020

2025

Asia Pacific11

21

31

476

1

11

1990

1995

2000

2003

2010

2015

2020

2025

South/Central America

2511

11

1990

1995

2000

2003

2010

2015

2020

2025

Africa

ConsumptionProduction

Net gas importers

Net gas ExportersSource of Data : BP Stats 2005 & IEO 2005

1. INTRODUCTION

Increasing crossIncreasing cross--border natural gas and LNG border natural gas and LNG trade globallytrade globallyg yg y

main Norway

SOUTH KOREA

Russian Federation

JapanTo East Asia

Canada UK

USA Cyprus KOREA

Brunei

Taiwan

Philippines

China

Trinidad & Tobago India

Qatar, UAE & Oman

Algeria

Egypt

Ni i

USA

Dominican Rep. & Puerto RicoBahamas

HondurasJamaica

Cyprus

Mexico

Brunei

Indonesia

Malaysia

Australia

Philippines

Angola

NigeriaVenezuela

Peru

Australia

Exporting Countries Importing Countries

Existing Existing

Under construction

Planned

Speculative

Under construction

Planned

Speculative

Existing Existing

LNG capacity is catching upLNG capacity is catching up

800

1 000

600

800

m

400

bcm

200

02000 2004 2010 2015 2020 2030

Pipelines LNGSource: OECD/IEA – 2007, World Energy Outlook 2006

LNG Capacity forecasted to grow LNG Capacity forecasted to grow

Source: Wood Mackenzie 2007

Gas markets were regionalGas markets were regionalin the recent pastin the recent past

Source: BG Group

A global gas trade is evolvingA global gas trade is evolving

Source: BG Group

LNG is driving gas market globalisationLNG is driving gas market globalisation

LNG market connectivity & trade flexibility y yincreasing

Supply flexibility has increased significantlySupply flexibility has increased significantly

US is emerging as the balancing marketUS is emerging as the balancing market

Source: CERA 2006

AgendaAgenda08/04/2008

gg

About IGUAbout IGU

Overall Gas OutlookOverall Gas Outlook

Gas Outlook in AsiaGas Outlook in Asia

Challenges & Opportunitiesg pp

Emerging gas markets in AsiaEmerging gas markets in Asia1. INTRODUCTION

Import dependency is increasingImport dependency is increasingin most regions by 2030 in most regions by 2030 g yg y

Source: IEA WEO China & India Insights

China & India major “increase drivers”China & India major “increase drivers”

Increase in World Primary Energy Demand, Imports & Energy-RelatedIncrease in World Primary Energy Demand, Imports & Energy Related CO2 Emissions in the Reference Scenario, 2000-2006

ChinaEnergy demand India

Rest of the world

Coal demand

Oil demand

Coal demand

Oil imports

0% 20% 40% 60% 80% 100%

CO emissions2

0% 20% 40% 60% 80% 100%Source: IEA Natural Gas Market Review 2007

AgendaAgenda08/04/2008

gg

About IGUAbout IGU

Overall Gas OutlookOverall Gas Outlook

Gas Outlook in Asia

Challenges & OpportunitiesChallenges & Opportunitiesg ppg pp

“Sold out“ at the world“Sold out“ at the worldresource marketresource market

currently sold out

Steelprice

Oil price

Go west? Go west? -- No, go east!No, go east!

Russia’s new target markets in Russia’s new target markets in Asian Pacific countries Asian Pacific countries

High gas potential in Asian Pacific countries (China!)

PRC‘s gas needs will amount up to 120 bcm by 2010

Shorter transmission route to China than to Europe

Absence of transit countries along the supply routepp y

Russia’s bright prospects of gas Russia’s bright prospects of gas sector development in far east sector development in far east pp

Sakhalin gas production area

Yakutsk gas production areaYakutsk gas production area

Krasnoyarsk gas

5,2Irkutsk gas area

y gproduction area

15 - 38

10 - 12Legend:Gas production areas

10 - 12

Production capability (in billions m3/year)

Pipeline gas demand forecast (in bill. m3)

LNG demand forecast (in billions m3)

Pipeline gasLNGLNG

Source: Gazprom presentation held in St. Petersburg IGU Council Meeting 10/2007

Challenges and Opportunities in undertaking Challenges and Opportunities in undertaking IranIran--PakistanPakistan--India or ‘Peace’ PipelineIndia or ‘Peace’ Pipeline

Trans-CaspianTrans-Caspian

pp

Turkmenistan –Afghanistan –Pakistan (TAP)

Turkmenistan –Afghanistan –Pakistan (TAP)

Alternative TAPAlternative TAP

LNG - liquefaction

LNG - regasification

LNG – regasification

(planned)

Bangladesh-India (BTI)

Bangladesh-India (BTI)

Iran–Pakistan–India Pipeline (IPI)

Iran–Pakistan–India Pipeline (IPI)

GAIL W t C tGAIL W t C t

GAIL – East CoastGAIL – East Coast

GAIL – West CoastGAIL – West Coast

Where will next generation LNG come from?Where will next generation LNG come from?

M yn a m a rM a u rita n ia

L ib yaIra n

V e n e zu e laP a p u a N e w G u in e a

A n g o laM yn a m a r

N.B. Proposed projects have varying degrees of likelihood

Y e m e nA b u D h a b i

P e ruN o rw a y

E q u ato ria l G u in e aL ib ya

E x is tin g

C i d

T rin id a dE g yp tO m a n

R u s s iaB ru n e iY e m e n C o m m ite d

P ro p o s e d

In d o n e s iaA lg e ria

A u s tra liaM a la ys ia

N ig e riaT rin id a d

0 1 0 2 0 3 0 4 0 5 0 6 0 7 0 8 0 9 0

Q a ta rIn d o n e s ia

M illio n T o n s p e r Y e a rM illio n T o n s p e r Y e a r

CERA: Presentation held on the IGU Council meeting in St. Petersburg 10/2007

08/04/2008

Thank youThank youThank you Thank you for your attention!for your attention!

See you in Buenos Aires!See you in Buenos Aires!

2424thth W ld G C fW ld G C f2424thth World Gas Conference World Gas Conference and Exhibitionand ExhibitionOctober October 5 5 –– 9 20099 2009