Experts have stated that it is time to get ready for a golden age for the gas industry, as Big Oil will be overtaken by natural gas in less than two decades.
The Telegraph reports that the chief of Norway’s DNV GL, one of the foremost risk assurance experts on the planet, has predicted that gas will become the world’s most important energy source by mid-2030, as oil continues to slow along with coal.
This prediction is reassuring for oil juggernauts such as Royal Dutch Shell and BP, which have already begun to balance their portfolios with gas exploration to safeguard their business.
DNV GL boss Remi Eriksen said a conservative forecast for global energy markets has uncovered a boom in renewable energy which will be great enough to meet half the world’s needs, but it is gas that was revealed to be the source that takes the lion’s share of the market.
“Gas will overtake oil as the world’s biggest source of energy by 2034,” he was quoted by the newspaper as saying. “By 2050 it will be the single biggest source at 27 per cent of demand.”
Furthermore, Eriksen said demand for gas will far outweigh the use of individual renewable energy sources such as solar, hydro and wind power, but these renewable energy sources will collectively account for 50 per cent of the world’s energy consumption.
As well as being less expensive than oil, gas is less of a pollutant than oil, which is another incentive for energy providers to move more of their interest into the gas arena, spreading their stake between gas and oil.
DNV GL expects an accelerated shift to gas away from oil by 2022 as oil giants decarbonize their business portfolios.
“There will be oil and gas in the future, and there will need to be further exploration of our resources because the depletion of existing reserves will be faster than the drop in demand,” Eriksen said. “But it will all depend on cost. The other factor is electric vehicles which by 2030 will really take a bite out of oil consumption from cars.”
In addition, demand for hydrocarbons is expected to peak in the coming two decades, requiring significant investment to add new oil and gas production capacity and operate existing assets both safely and sustainably.
DNV GL CEO Elisabeth Tørstad added that the oil ad gas industry must continue on its path of cost control to remain relevant in a shifting energy industry if it wants to help shape the future.
The group’s oil and gas predictions consider the key trends identified by the company’s model across the market’s value chain exploring the implications and drivers behind what is changing the industry.
Tørstad added that digitisation, standardisation and autonomous operations will help oil and gas to improve its carbon footprint while helping the sector to achieve cost savings.
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