Gas supply security : a challenge for Europe?

Home > News & Views > Gas supply security : a challenge for Europe?

< Back

Addressing the French member committee in Paris, Jean-Marie Dauger, Chair Strategy and Communications Committee, talked about the future of gas supplies in Europe saying: “Natural gas will remain a key component of the energy balance for many decades because of the abundance of reserves and the role it plays in replacing coal.

“Whilst Europe shows lower gas growth prospects than the rest of the world, natural gas will remain essential to Europe’s energy balance for many decades to come. The reduction of Europe’s own resources will bring the share of external imports of 50% today to around 65% in 2035, of which half will be supplied by Norway.”

Dauger went on to summarise the issues surrounding security of supply in Europe saying that in a rapidly changing context where global gas reserves are abundant, access to these resources will depend almost exclusively on the political and economic capacity of operators to make investments.

In the short and medium term, Dauger believes that security of supply is generally safe because of a combination of the following factors:

Weak demand caused by the economic situation and increase of renewables together with milder winters
Integration and size of installed infrastructures
Effects of diversification policies pursued by the major European operators
Abundance of new projects, especially liquefied natural gas (LNG) projects which should continue due to the scheduled arrival of new LNG sources, particularly from the US and Asia.

In spite of the situation in Ukraine and the Eastern and North African crises, Dauger thinks that conditions are good and that risks can be reduced through:

Restoring more peaceful trade and political dialogues
Diversification of Russian gas transportation patterns to Europe
Reinforcement of European networks to ensure that countries are not too dependent on a single source.

Dauger concluded with the following points:

Russia is a key gas partner for Europe, as in turn Europe is a necessary partner for Russia
Europe must continue to diversify its supply sources and gas transit routes. Whilst progress has been made, for example Caspian Sea projects, the fall in prices affects the progress of long term projects. However, on the other hand it is also an opportunity for enhanced cooperation between major European operators and producers
The use of biogas and unconventional gas sources will help in achieving diversification goals
European governments must do everything possible to open up channels which facilitate dialogue at a political level with major producing countries.

Dauger added: “Progress is still needed to transform Europe into one market with unified rules that ensures the safety of the long-term supply of gas. To achieve future security and success over the coming decades, there must be an environment which favours investment and accounts for the risks that have to be taken.”

The World Energy Council is acting as host to the Global Gas Centre which has recently been established to bring together senior leaders in the sector in order to provide a better understanding of the role that natural gas plays in the energy mix. Its members include Gazprom, Swissgas, ENGIE, OMV, Fluxys and the National Iranian Gas Company.