PERTH (miningweekly.com) – The global gas industry is expected to play a ‘vital role’ in economic recovery post Covid-19, and in a cleaner energy future, a new report by the International Gas Union (IGU) has found.

In its Global Gas Report 2020, the IGU noted that after growing by more than 2% in 2019, global gas use is set to fall by around 4% in 2020, as the Covid-19 pandemic reduces energy consumption across the global economies.

However, the resulting low gas prices, as well as clean air and climate policies, will promote further switching to gas from other more polluting energy sources, such as oil and coal.

The report noted that this trend was already under way before the pandemic, thanks to cost-competitive gas in key sectors including power, industry and transport, and major regions including Europe, North America and Asia.

The report showed that medium-term growth would come from increasing cost-competitiveness and increased global access to gas. A particular growth opportunity exists in liquefied natural gas. Liquefied natural gas (LNG) imports reached 482-billion cubic meters in 2019, up 13% from 2018, and while this figure is expected to fall by around 4.2% in 2020, it could rebound quickly to previous levels as soon as 2021, depending on the persistence and longevity of the pandemic.

Ample natural gas resources exist to support demand growth, but greater gas infrastructure development is needed to support growth in the medium term. India is planning to almost double the length of its gas transmission grid, while China will grow its gas network about 60% by 2025.

The Australian Petroleum Production and Exploration Association (Appea) said that the report also found that technology and innovation could play key roles as countries, including Australia, look to significantly reduce their greenhouse gas emissions. 

Technologies such as biomethane, hydrogen and gas with carbon capture and storage can all play a key role in emissions reduction.

“The report found 2019 was a strong year of growth for the global gas industry, as abundant supply and competitive prices underpinned emissions reduction through fuel switching from more emissions-intensive fuels to natural gas.

“In 2020, the adverse impact of Covid-19 on the gas market has been significant and the industry now faces challenging market conditions.  Encouragingly, the report finds that continued abundant supply and cost-competitiveness, aided by a growing push for cleaner air and emissions reduction, can lead to a recovery in demand and see the industry, both globally and in Australia, play a role in economic recovery,” said Appea CEO Andrew McConville.

Australian Pipelines and Gas Association CEO Steve Davies noted that the direct use of natural gas for high-quality heat would continue to grow, gas-fired power generation has great potential to partner with renewable electricity and gas would start to decarbonise through improved operations and blending with biomethane and hydrogen.