Australia, Indonesia and Papua New Guinea may help drive a new "golden age" of natural gas consumption from the supply side, while China will be the main driver on the consumption side, International Energy Agency's chief economist Fatih Birol said Tuesday in Jakarta.
"I see a golden age for gas starting, and the start of this new age will be driven by Asia, both in terms of production and consumption," he said, speaking to reporters at the Pacific Energy Summit.
On the supply side, IEA sees about 90 billion cubic meters in LNG projects that are either under construction or that have already reached a final investment decision, mostly in Asian countries, including Australia, Indonesia and Papua New Guinea.
"This would be make the Asia Pacific gas market very dynamic," Birol said.
Together with Indonesia, Australia's role is very important, he said, with the country on track to become the second-largest gas exporter behind Qatar in the Middle East.
"And around 2020, if the current projects in Australia go ahead, we may see Australia become the number one gas exporter," he said.
Meanwhile, in term of consumption, Birol added, China will be the primary driver. Last year, China consumed about 110 Bcm of gas, more than Japan, he said; and its consumption is expected to more than double to 250 million Bcm in the next five years, according to the targets set out in the latest five-year plan.
"That is why China needs to import a lot of LNG from the Asia Pacific market," he said.
That will leave China with still plenty of room to grow. In five years time, if China hits the 250 Bcm target, gas is still only expected to make up only 5% of the country's energy mix.
"Which is very low compared to mature markets such as the US and Europe and Japan, where gas makes up 25%-30% of the mix," he said. "This is mainly because gas is not used in electricity generation [in China] yet."
