JEDDAH — The Middle East and North Africa (MENA) region holds nearly 88 trillion cubic meters (tcm) of proven natural gas deposits, the Arab Petroleum Investment Corp (Apicorp) said Sunday. Apicorp, a subsidiary of the Organization of Arab petroleum Exporting Countries (OAPEC), said that at current output growth rate of 6.9 percent per year, these deposits could last for 33 years. It added that the amount represents around 42 percent of the world's total gas wealth, with the bulk based in the UAE, Iran, Qatar, Saudi and Algeria. On the other hand, the undiscoverable gas deposits are estimated at 26.6 tcm. Undiscovered deposits were put at 12.8 tcm in Saudi Arabia, 5.9 tcm in Iran, 0/92 tcm in Algeria, 0.81 tcm in the UAE, 0.77 tcm in Qatar, 0.63 tcm in Oman, around 0.39 tcm in Libya and 0.38 tcm in Egypt. At the start of the current year, Iran had nearly 33.1 tcm of recoverable gas deposits, whereas the amount stood at 25 tcm in Qatar, 8.2 tcm in Saudi, 6.1 tcm in the UAE, 4.5 tcm in Algeria, 3.6 tcm in Iraq, 2.2 tcm in Egypt, 1.8 tcm in Kuwait, 1.5 tcm in Libya and almost 0.9 tcm in Oman. “For a production growth of 6.9 per cent a year, which corresponds to the last 10-year average, future volumes from remaining reserves would last 33 years….this is just above the conventional 30-year time horizon for strategic planning in the field of exploration and development (E&D),” Apicorp's senior consultant Ali Aissaoui said in a five-page study. “Our findings confirm and extend our previous results showing that on aggregate Mena proved reserves are substantial and their combined dynamic life is a little beyond the traditional 30-year strategic planning horizon for E&D.” However, Aissaoui warned that reserve depletion in more than half the countries listed in the study has critically neared – if not already reached – the point that warrants drastic actions to curb demand and support a supply response. He said the opportunities for the latter will be driven by a vast potential for reserve expansion, adding that on a country-by-country basis, the potential appears to be the greatest in Iran, Saudi Arabia and Qatar, followed by Iraq, the UAE and Algeria. Prospects also seem favorable in Egypt, Oman and Libya, he added. “As the opportunities available will be increased by unconventional gas, they will entail significant challenges…confronting the region's natural gas paradox – a paradox of scarcity amidst plenty – requires both a demand and supply response,” he said. “As far as the supply side is concerned, Mena policy makers need to rethink critically their E&D policies and the corresponding economic incentives.” Gas production in the Middle East and North Africa has increased considerably in the last 10 years, in contrast to oil production, which has remained relatively unchanged, Energies Nouvelles said in its Panorama 2012 report on MENA oil and gas. For some countries (Saudi Arabia, the United Arab Emirates and Iran), this increase has been focused solely on meeting strong growth in local demand, whilst for others (Qatar, Algeria and Egypt), it has been a matter of boosting gas exports. There are three sources of gas: gas production in association with oil production, unassociated gas production with low acid gas content and unassociated gas production with high acid gas content. The majority of production in Saudi Arabia and the United Arab Emirates is gas associated with oil production. This type of gas has a relatively low production cost, but has the drawback of depending on the level of oil production. In Qatar, Iran and Algeria, the majority of gas production is focused on super-giant free gas deposits of excellent quality (North Field2, South Pars and Hassi-R-Mel). These fields contain a high proportion of natural gas condensates and liquids, which contribute additional income and allow natural gas to be marketed at a competitive price. Qatar, in collaboration with a number of international oil companies, has thus been able to quintuple its gas production volumes in 10 years to become the world's largest exporter of LNG. — SG
