The North American gas market has historically always had the cheapest price compared to other regional markets, with very few short-term exceptions, mostly due to an earlier start of the liberalization process and enhanced competition for high production levels. After important price spikes during the mid-2000s due to a general perception that the US were running out of gas reserves, the shale gas revolution has progressively flooded the domestic market and depressed prices. The current North American low-price environment is expected to continue with a slight recovery over time, among others due to US plans for large-scale LNG exports and the fact that associated gas (from tight oil production) continues to grow in the US. However, given the flat nature of the US shale gas production cost curve, the influence of exports on domestic prices should remain limited in the mid-term.
After the 2009-2016 mismatch observed in Europe between very low gas market prices in North-Western Europe and oil-indexed prices dominating continental Europe, the dual pricing system has become unsustainable and producers have been progressively forced to offer also market-based gas prices. Following the oil price collapse of 2015, oil-indexed gas prices collapsed in 2016 and have remained relatively low since then. In the long run, prices may not increase significantly due to possible supply surges from Australian LNG and/or US LNG likely to land in Europe and compete with Russian gas. Even though Russia would want to keep its market shares, which could drive the European gas price up by around 2025, European gas prices are expected to increase moderately in the long run. Up to 2040, and despite the German phase-out from coal-fired electricity generation and an expected increased demand in Europe, global supply is expected to be abundant.
Gas prices on the Asian market are largely index on the oil price. These have recently collapsed, following the collapse of oil price and the massive increase in new LNG supply (mainly from Australia). As Asian markets progressively absorb the gas glut, prices are likely to increase again, one reason for this being the current Chinese shift from coal-fired electricity generation to power plants fueled with gas and renewables. Conversely, large additional LNG sources are rising on the horizon (e.g. USA, Russia, Qatar). Overall, the Asian gas price is expected to increase in the long run, staying largely above expected gas prices in the North American and even European markets.
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The Ministry of Coal of India plans to launch a large scale programme to promote the use Coal Bed Methane (CBM) as an alternative fuel to meet residential energy demand within the next two years.
According to the Canada Energy Regulator (CER), Alberta’s marketable gas production is expected to stagnate over the period 2019-2040. On the contrary, British Columbia’s gas production is projected to keep on increasing, catching up with Alberta’s in 2040 thanks to rising growing tight gas production from the Montney Formation. The two provinces accounted for 94% of Canada’s gas production from 2010 to 2018. LNG exports from Canada’s west coast are expected to start in 2025.
The government of Indonesia plans to double gas production in the archipelago over the next decade, in bid to reduce the country’s energy trade deficit. The country intends to produce 127 bcm of natural gas in 2030, against 72 bcm in 2018. The government previously said the country could become self-sufficient in 2025.
According to the Ministry of Energy of Indonesia, the slowdown in the country's electricity demand (+4.5% in 2019 against a government target of +6.3%, and +3.8% only in January 2020) at a time when new power capacities are being commissioned may result in state-owned power utility PT PLN generating more power than needed. Some islands such as Java and Bali may be over-supplied by up to 41.5% in 2020, while Halmahera may be over-supplied by 202%.
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