1. Energy Delta Institute
NATURAL GAS - A CONTRIBUTOR TO IMPROVING OUR ENVIRONMENT, CLIMATE AND COMPETITIVENESS
Energy Delta Institute
Marcel Kramer
President
25th FORUM: ENERGY DAY IN CROATIA, Zagreb,

2. Founded in 2002 by
Joined in 2006
ASSOCIATED PARTNERS:

3. Knowledge partners and network of lecturers
Around 200 lecturers from business and academia

4. Business partners
And many more

5. Traditionally we are Europe and gas focused, but …

6. Regional supply/demand balances show important shifts over the past decade…
REGIONAL SUPPLY SHORTFALL/SURPLUS (BCM P/A) PRODUCTION CHANGE
NORTH AMERICA
EUROPE + EURASIA
MIDDLE EAST
ASIA PACIFIC
GLOBAL PRODUCTION ( = %)*
*Global primary energy consumption grew by 20.2 % over the same period
Source: BP Statistical Review

7. The Global picture for Gas - causes for some optimism
WEO 2016: renewables and natural gas are the big winners in the race to meet energy demand growth until 2040
Over the past decade, global gas demand grew by 27 %, overall energy demand by 20%
Analyses indicate growth in the next decade driven mostly by Asia, major variables include environmental/climate policy, gas vs coal
European market sees some erosion of demand and falling output, but also upside in some regions and coal vs gas as key question mark
Affordable and ample supply, growing liquidity, lots of spare infrastructure capacity for import/export in many places

8. Gas is ‘environmentally competitive’
By replacing oil and coal with gas the emissions (incl. particles!) are significantly reduced, and gas is a practical partner for renewables
Gas is not only beneficial in terms of Co2 emissions but also in terms of air quality. In particular heavy duty and maritime transportation (SOx and Nox) offer impressive emission reductions
The health impact of the introduction of gas is measurable and large. Gas replacing coal SAVES MANY LIVES..
Reducing emissions by bringing more gas to the market is far more efficient than generating the same reduction through wind power

9. Yet, the virtues of gas are not universally accepted..
Some want a “completely fossil-free world”…
The general public is often ill-informed, believing that wind and sun are almost “free”, politicians often “ride the bandwagon”
Geopolitics cast a cloud over energy in general and natural gas (and oil ..) in particular
The gas industry has been late in explaining its benefits and has an image issue in some markets

10. So, what could be done?
To begin with, there are no easy answers in energy supply and policy.. Strategically important, complex, usually long lead times, many different commercial and other interests
Open access to all potential suppliers into a market, with a fair return to infrastructure investors
Private investment in removing infrastructure bottlenecks should be encouraged
The transparency of costs for users should be improved
The health care benefits of gas deserve more attention
The gas industry should be environmentally pro-active and
communicate with the general public

11. SEE finds itself at a major cossroad with room for growth
DG Energy expects gas demand in SEE to increase by almost 70% to more than 60 BCM by 2035.
Source: Atlantic Council

12. Developments in the South Eastern Europe (SEE)
The energy markets in South Eastern Europe are progressing dynamically, while offering new opportunities and the need for education and training on issues, such as:
Use of network codes
Energy trading on hubs
Liberalisation of energy markets
Regulation
Connecting markets

13. EDI’s portfolio offers life long learning
Executive education of EDI:
Besides, EDI offers:
Zero - Basic level Intermediate Advanced
Executive Master and Leadership Programmes
Specific Programmes
Introduction Programmes
E-learning
For blended tracks & as a pre-reading material
Customized programmes
Classroom: In-companies, partner events
Online: e-learning
Combination: blended learning
Knowledge update
Classroom: knowledge sessions, events, in-companies
High level events

14. Main course and event topics: inspiring and innovative
Energy Market Developments and Geopolitics
Energy Transition and Innovation
LNG and Energy Infrastructure
Regulation and Finance
Energy Leadership
Safety Culture & Leadership

15. THANK YOU FOR YOUR ATTENTION!
EDI will be pleased to discuss the opportunities for Croatian companies and organisations to benefit from our courses and vast industry network.
THANK YOU FOR YOUR ATTENTION!
Marcel Kramer
President

16. BACKUP SLIDES

17. In two decades the number of big gas producers (over 100 BCMA) will have increased 3 times
Major gas producers in the world in 2000 and 2020

18. Among key developments on the LNG front are:
North America from importer to exporter (shale gas driven, and many LNG projects ‘in the pipeline’). However, questionable whether US LNG can compete with Russian pipe gas?
Australia becomes the world’s largest LNG exporter (but no new FIDs taken for several years now)
CAPEX rose substantially: from $15 billion in 2010 to $60 billion in 2015
Growth in FLNG and ‘small scale’ facilities and new users (esp. transport)
Africa emerged as potential new player
New LNG cycle expected to kick in second half of 2020ies

19. Long-term global trends: new producers entering the market with increasing liquefaction capacity
Global liquefaction capacity growth

20. LNG key figures 2015
245 millions traded, of which 28% on spot or short-term basis
72% of global demand is in Asia
Qatar supplied 32% of total volumes
Total nameplate liquefaction capacity 308 mtpa, while total regasification capacity at 777 mtpa
19 exporting countries, versus 34 importing countries

21. Major LNG flows connecting markets
Source: GIIGNL

22. SO: An era of globalisation- or at least of increasing interconnections between regional gas markets…
Significant growth in trade between regions due to new regional supply balances and growth in LNG (and some new pipeline systems as well), and many new entrants in the trade
Growing trade brings trend towards price conversion between regions
Cross basin delta disappears
Still considerable differences between markets and contract structures: ‘gas is less global than crude oil’

23. What drives prices over the next five years?
Asian demand growth rate. A very wide forecast range…
NW Europe the market of last resort for LNG? And how will Russian exporters react?
How much more liquefaction capacity, esp. from the US?
Will gas gain ground against coal - how much and when?
And: the oil price is still going to be important to the gas trade and to infra spending

24. Some final points
The industry sometimes underestimates major developments, see shale gas and its impact
Low prices eliminate some supply (and some companies), but also bring new efficiencies and solutions
There is plenty of capital available for quality projects
Attracting and keeping talent, also when prices are low and when other sectors may look more ‘fashionable’ is crucial… Encourage education, training and networking!