EU 2011 gas production down by 11%, largest decline on record – BP

13 June 2012 14:17  [Source: ICIS news]

LONDON (ICIS)--Natural gas production in the EU declined by 11.4% in 2011 – the largest drop on record – driven by weak regional consumption, energy giant BP said on Wednesday.

In its 2012 Statistical Review of World Energy, UK-headquartered BP said a combination of mature fields and maintenance was also partially responsible for the sharp decline.

In 2011, natural gas consumption fell by 9.9% in the EU, driven by a weak economy, high gas prices, warm weather and continued growth in renewable power generation.

However, global consumption grew by 2.2%, with the US and China driving growth, BP said.

“Consumption growth was below average in all regions except North America, where low prices drove robust growth,” said BP. “Outside North America, the largest volumetric gains in consumption were in China (+21.5%), Saudi Arabia (+13.2%) and Japan (+11.6%).”

However, these increases were partly offset by the EU’s record decline in consumption.

Global gas production grew by 3.1% in 2011, with the US recording the largest volumetric increase, despite lower gas prices, to remain the world’s largest producer.

“Output also grew rapidly in Qatar (+25.8%), Russia (+3.1%) and Turkmenistan (+40.6%), more than offsetting declines in Libya (-75.6%) and the UK (-20.8%),” the company added.

BP said following the general weakness of gas consumption growth, global natural gas trade increased by a relatively modest 4% in 2011.

“[liquefied natural gas [LNG]] shipments grew by 10.1%, with Qatar (+34.8%) accounting for virtually all (87.7%) of the increase,” it added.

The energy giant said that among LNG importers, the largest volumetric growth was in Japan and the UK.

“LNG now accounts for 32.3% of global gas trade. Pipeline shipments grew by just 1.3%, with declines in imports by Germany, the UK, the US and Italy offsetting increases in China (from Turkmenistan), Ukraine (from Russia) and Turkey (from Russia and Iran),” it added.

Meanwhile, BP Group CEO Bob Dudley said global energy consumption grew by 2.5% in 2011, broadly in line with the historical averagem but well below the 5.1% seen in 2010.

“Once again emerging economies accounted for all of the net growth in energy consumption, with demand in the [Organisation for Economic Co-operation and Development [OECD]] falling for a third time in the last four years,” he added.

Dudley said the centre of gravity for world energy consumption continues to shift from the OECD to emerging economies, especially in Asia.

“The world is not structurally short of hydrocarbon resources – as our data on proved reserves confirms year after year – but long lead times and various forms of access constraints in some regions continue to create challenges for the ability of supply to meet demand growth at reasonable prices,” he added.

BP said energy consumption in OECD countries fell by 0.8% – the third decline in the past four years – while consumption in non-OECD countries grew by 5.3%, in line with the 10-year average.

“Global consumption growth decelerated in 2011 for all fuels, as did total energy consumption for all regions. Oil remains the world’s leading fuel, at 33.1% of global energy consumption, but continued to lose market share for the twelfth consecutive year. Its current market share is the lowest in our data set, which begins in 1965,” BP added.

By: Leigh Stringer
+44 208 652 3214

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