GCC natural gas market has been a recipient of the concerns related to energy security and climatic changes due to increasing fossil fuel consumption. In a bid to strengthen the regional sustainable energy scenario, GCC countries including Kuwait, UAE, Bahrain, Saudi Arabia, Qatar, and Oman have been planning to increase the dependency on sustainable energy sources for curbing carbon footprints. In accordance, they have apparently set long-term goals that are certain to favorably stimulate GCC natural gas industry size.
Saudi Arabia Natural Gas Market Size, By Application, 2017 & 2024 (USD Million)
Aimed toward encouraging foreign as well as local investors to contribute to the development of sustainable energy projects, member states of GCC have compiled a set of stringent regulatory norms. With more and more regulatory policies concerning energy transition becoming commonplace, GCC natural gas market outlook is likely to undergo a transformation in the years to come. The UAE for example, has initiated a policy called ‘Energy Strategy 2050’ that targets carbon footprint reduction by 70% while simultaneously increasing the share of clean energy in the overall energy mix to 50% by 2050.
In the last few years, domestic energy demand across GCC countries has been increasing tremendously, owing to the surging industrialization these nations have been witnessing. Presuming that the current scenario remains consistent, the increasing consumption of fossil fuels for fulfilling energy requirements is certain to pressurize the lack of available energy resources. In addition, the high economic dependency on hydrocarbons and rapid growth in population will also enforce substantial pressure on the social and financial sphere of GCC countries. Taking into account the challenging situation in the coming years, GCC governments have set national energy consumption patterns mainly to promote sustainable energy consumption. They seemingly aim to produce natural gas on a large scale, which will quite overtly, raise the commercialization scale of GCC natural gas market. Incidentally, the research team at King Abdullah Petroleum Studies and Research Center found that Saudi Arabia accounts for nearly 44% of the overall natural gas production across GCC countries.
Continuing alongside similar lines, Saudi Arabia, with other member countries such as UAE has been striving since long to concentrate on unconventional gas production. That said, one of the principal factor aiding the growth of GCC natural gas market is the abundant availability of natural gas resources in the region and the rapidly rising consumption levels of the same. Apparently, regional contenders have been working on a number of growth strategies, specifically increased investments to upscale the revenue graph of GCC natural gas industry. Saudi Aramco, for example, the national oil company, recently declared an investment of USD 7 billion in addition to an earlier capital, to accelerate the development of shale gas resources in the region. As the country’s shale gas potential comes to the fore in the ensuing years, GCC natural gas market as a whole is certain to benefit from this strategy, placing Saudi Arabia is a position of dominance. Powered by the continuous efforts of the government in gas exploration and excavation activities, GCC natural gas industry size from Saudi Arabia will register a CAGR of 3% over 2018-2024.
Speaking more about the O&G exploration and excavation programs, many foreign investors have depicted their interest in the Omani gas fields owing to the rise in gas production across this region. Validating the aforementioned fact, UK based petroleum company, BP has signed a deal with the Oman Oil Company to enhance gas production. This collaborative approach of the company to escalate gas exploration activities has been touted to reduce the economic dependency of the country on oil revenues. In fact, the Oman government is also looking forward to supplying natural gas to domestic energy-intensive companies and power generation plants, diversifying the country’s economy away from oil. The surging domestic energy consumption and ongoing gas exploration activities across Oman will thus propel GCC natural gas market share over the years ahead.
As of now, heavy investments by the Gulf countries on oil and gas projects have been making a remarkable impact on GCC natural gas market trends. The growth strategies adopted by regional governments to promote energy-intensive and petrochemical industries to use natural gas for accomplishing their energy needs is also poised to propel the product demand. As the growing energy need for domestic industries reduces the economic dependency of most of the Gulf countries on oil exports, owing to the increasing gas production, GCC natural gas industry is certain to observe an upsurge. Powered by regulatory support and growing gas exploration activities, GCC natural gas market size is expected to register a CAGR of more than 4% over 2018-2024.