Natural gas plays a vital role in the world's transition to clean energy, International Energy Forum (IEF) Secretary General Joseph McMonigle said in a speech hosted by the Gas Exporting Countries Forum (GECF).
Natural gas can act as a transition fuel, especially for Asian economies seeking to switch from coal to cleaner fuels; it is a valuable resource providing affordable and reliable energy; it is a catalyst for pairing complementary energy technologies including renewables and hydrogen; and it is an accelerator that drives economic growth, he told the audience in the lecture on Monday.
"Multiple challenges remain in reigniting economic growth, returning livelihoods and job opportunities to families and younger generations while meeting climate, clean air and sustainable development goals," said Mr McMonigle. "All center on the use of natural gas technologies and their capacity to accelerate fuel-switching and create synergies to integrate renewables, green gas, hydrogen and other carbon dioxide solutions."
The natural gas industry, comprising both infrastructure clusters and knowledge networks, can serve as an accelerator to create jobs, reduce pollution and provide the affordable energy that a swift and sustainable recovery needs, Mr McMonigle said.
Expected advances in carbon capture technologies will ensure that natural gas is able to play an ever-larger role in achieving the competing demands of climate, clean air and energy access, he added.
The GECF is the global platform for gas exporting nations, and its lecture series features energy policymakers and experts. Mr McMonigle's lecture, the "Role of Gas in Clean, Reliable, and Sustainable Growth", was the 49th in the series.
The latest IEF Energy Outlooks Report found a wide variation in the outlook for natural gas demand, reflecting growing uncertainty about its role in the transition, even though market fundamentals remain strong, he said.
"Demand for natural gas is either growing by close to 40% or falling by nearly 20% by 2040," said Mr McMonigle. "These views reflect different policy and technology pathways for the possible evolution of long-term natural gas demand. While both renewables and nuclear energy show phenomenal growth across all scenarios, assumptions on the role of natural gas in energy sector transformations differ more strongly than before."
There has also been a sharp drop in investment in developing new natural gas resources that raises the risk of a supply crisis in the near future, he warned.
"Oil and gas capital expenditure declined by 34% year-on-year last year. More strikingly, global upstream capital expenditure in 2020 was circa 50% lower than 2014 levels. Looking ahead, we assume a decline in upstream expenditure, by 20% in 2021," said Mr McMonigle. "Without dialogue and collaboration among producers and consumers, the prospect of higher prices and greater market volatility will become real in the meantime but will benefit no one."