DNV GL forecasts gas to overtake oil demand as gas capital expenditure grows
The report says usptream gas capital expenditure will grow to a peak of $1.13 trillion in 2025
DNV GL's latest report, 2018 Energy Transition Outlook, predicts that gas will overtake oil as the world's primary energy source in 2026, and will account for 25 percent of the world's energy by 2050.
It also predicts that global oil demand will peak in 2023 while gas demand will continue growing until 2034. The focus on decarbonisation will intensify in these years, making gas a bridge between fossil fuels and renewable energy sources.
“Gas will fuel the energy transition in the lead-up to mid-century. It sets a pathway for the increasing uptake of renewable energy, while safeguarding the secure supply of affordable energy that the world will need during the energy transition,” said Liv A. Hovem, CEO, DNV GL, Oil & Gas.
Conventional offshore and onshore gas production is expected to decline after 2030, while unconventional onshore gas is forecast to peak in 2040. DNV GL notes that this could "lead to leaner, more agile gas developments with shorter lifespans." The Middle East and North Africa will have the highest annual rate of new offshore gas production capacity until 2050.
Meanwhile, LNG capacity is expect to double by the late 2040s, connecting changing gas sources with shifting demand centres.
“Our forecast points to a faster, leaner and cleaner oil and gas industry in the future," said Hovem. "It’s time for our sector to enhance focus on developing the digital technologies that will enable quicker and more agile exploration and production, and the smooth integration of less carbon-intensive gases into the energy system."