The Role of Stranded Gas from Central Asia, Russia, Southeast Asia, and Australia in Meeting Asia's Future Demand for Gas Imports

摘要

Demand for natural gas is increasing more rapidly than anticipated in Far East markets because (1) China has modified its policies in order to increase reliance on gas, in part to mitigate the growth in its coal consumption (which now stand at almost half of world coal production), (2) Japan has announced its intention to eventually shutdown its nuclear power industry, and (3) India, which currently has more than 400 million people without electricity, desires to accelerate electrification. This analysis investigates the potential role of stranded gas from Central Asia, Russia, Southeast Asia, and Australia in meeting Asia’s future demand for gas imports. It initially surveys the discovered or known gas in stranded gas accumulations in Central Asia, Russia, Australia, Indonesia, and Malaysia. It then examines the primary gas import markets of China, India, Japan, and South Korea by describing energy use, gas demand trends, and domestic gas supplies to establish boundaries that encompass the wide variation in gas import demands in these markets during the two decades following 2020. Then the cost of developing and delivering gas through overland pipelines from selected stranded gas fields in Central Asia and Russia to China is examined. Analysis shows that for the Shanghai market in China, the costs of developing and delivering Russia’s stranded gas from the petroleum provinces of eastern Siberia are competitive with costs estimated for stranded gas from Central Asia. However, for the Western Siberian Basin, delivered gas costs are at least 3 US dollars per thousand cubic feet (USD/Mcf) higher than delivered gas from Central Asia. The extraction and transport costs to a liquefaction plant for gas from stranded gas fields located in Australia, Indonesia, Malaysia, and the basins of eastern Siberia are then evaluated. The resource cost functions presented show development and extraction costs as a function of the volume of stranded gas developed for each country. The analysis demonstrates that, although the Russian fields in areas of eastern Siberia are large with relatively low extraction costs, distances to a potential liquefaction plant at Vladivostok make them initially the high cost suppliers of the liquefied natural gas (LNG) market. For the LNG markets examined, Australia and Malaysia are initially the lowest cost suppliers. For the Shanghai market, a comparison of the cost of supplying gas by pipeline with the cost of supplying LNG shows that the pipeline costs from areas of eastern Siberia and Central Asia are generally lower than delivered cost of gas as LNG from the LNG supply sources considered.