Natural gas to become global fuel of choice by 2040 – ExxonMobil

08 December 2011 23:00  [Source: ICIS news]

HOUSTON (ICIS)--Natural gas will replace coal as the world’s top energy source by 2040 as coal consumption begins to decline for the first time in modern history, ExxonMobil said on Thursday.

While oil will remain the most widely used fuel, ExxonMobil said in its 2012 energy outlook that with energy efficiency improvements in areas such as transportation, world energy demand will shift toward less carbon-intensive energy sources like natural gas, which emits up to 60% less carbon dioxide than coal.

Demand for oil and other liquid fuels will rise over the next 30 years to 110m bbl of oil equivalent (boe)/day from 80m boe/day, and most of that increase will be linked to transportation, according to the company. A growing share of the supplies used to meet liquid-fuel demand will come from deepwater oil reserves, oil sands, tight oil from shale reserves, natural gas liquids (NGL) and biofuels.

Meanwhile, natural gas will be the fastest-growing major fuel to 2040, with demand rising by more than 60%. Natural gas will replace coal by 2025 as the second most popular fuel after oil.

Global natural gas demand will increase to more than 500bn cubic feet/day from roughly 300bn cubic feet/day in 2010, according to the energy outlook.

“Gas continues to be the growing fuel of choice in the outlook,” said William Colton, ExxonMobil’s vice president of corporate strategic Planning. “We not only expect to gain share in electricity but also growing in residential and commercial applications.”

Advances in unconventional US natural gas production are expected to keep domestic supplies ample for the foreseeable future. Colton said the increase in natural gas usage is possible by the immense global gas resources.

ExxonMobil’s outlook stated world energy demand will grow by 30% in 2040 and energy growth is particularly strong in the non-Organisation for Economic Co-operation and Development (OECD) countries in the Asia Pacific region, where demand for natural gas is expected to grow by close to 60% over the next 30 years from 115,000,000bn Btu (in 2010) to 186,000,000bn Btu.

Manufacturing and chemicals will account for 90% of the increase in industrial energy demand growth, ExxonMobil said.

However, coal use will continue to grow through 2040 in developing countries such as China and India. As these countries continue to raise their living standards, they will also require more energy.

Coal demand will peak and begin a gradual decline because of new energy policies trying to curb emissions, causing use of renewable energy, such as nuclear power, to grow. Right now, the US leads the world in emissions because of living standards.

“By 2040 there’s still a huge gap in emissions in the developed and developing worlds,” said Colton.

The key reason energy demand will rise by only about 1% per year on average, even as global GDP rises by nearly 3% a year, is continued development in energy efficiency. It also is the reason why OECD energy demand will remain relatively unchanged through 2040 even as its economic output nearly doubles, ExxonMobil said.

By Anna Matherne

Paul Hodges studies key influencers shaping the chemical industry in Chemicals and the Economy

By: Staff Reporter
+44 20 8652 3214

AddThis Social Bookmark Button

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly

Get access to breaking chemical news as it happens.
ICIS Global Petrochemical Index (IPEX)
ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index