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Worldwide natural gas demand will grow from about 300 billion cubic feet per day last year to more than 450 bcf by 2030, with power generation burning up almost half of all gas consumed in 2030, an ExxonMobil executive told several hundred Alaskans.

It was only a few years ago that U.S. gas buyers worried about security of supply and assumed the nation would import a growing volume of LNG, said Steve Kirchhoff, Americas vice president at ExxonMobil Gas and Power Marketing Co. in Houston. That was before the boom in shale gas production.

"Changes happen at a very, very, very rapid pace," Kirchhoff said in his presentation at the Resource Development Council's annual conference Nov. 16 in Anchorage.

With a "very large supply" of gas worldwide, more and more energy consumers are seeing the advantages of natural gas, he said. Consumption for power generation will double by 2030 as gas becomes the fuel of choice for a majority of the world's power plants, according to ExxonMobil's estimates.

In the United States, Kirchhoff said, utilities and state regulatory agencies are growing more comfortable with long-term commitments to natural gas. It's cleaner and more efficient than coal, and security of supply seems assured for decades. While conventional U.S. gas production is expected to drop below 25 bcf per day by 2030, according to ExxonMobil, unconventional production (shale, tight sands and coal-bed methane) will more than cover that loss. Still, the market will need Canadian pipeline gas and some LNG imports.

ExxonMobil sees worldwide energy demand growing for coal and oil, too, but with natural gas demand climbing at a much faster rate. Natural gas demand among Asia-Pacific nations will more than double by 2030. Not to be lost in the LNG headlines, however, Asia-Pacific nations in 2030 will produce enough of their own gas to cover two-thirds of domestic needs. LNG and pipeline gas will cover the missing one-third.

Still, even with that growing demand, LNG deliveries to Asia-Pacific nations will comprise only one-sixth of worldwide growth in gas consumption in the next 20 years. The majority of the other five-sixths will be delivered by pipelines and LNG tankers to Europe, North America, even the Middle East as it starts to burn more natural gas for power.

Despite all of the new LNG projects under construction or proposed for Australia, it will not be enough to meet Asia-Pacific demand, Kirchhoff said. North American and Mideast LNG will try to grab market share, "but it won't be an easy competition." LNG projects are huge, with heavy capital requirements, he said. "Success does not come easy."

As for prospects of Alaska North Slope natural gas pipeline, the ExxonMobil executive said, "What's really missing are the durable and predictable fiscal terms to move the project forward."

The project needs alignment among the North Slope producers and between the producers and the state of Alaska, he said. "Alaska North Slope gas is competing in a growing and increasingly global marketplace," Kirchhoff said, without predicting which market(s) Alaska gas might target. "It's certainly achievable."

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