'Future of MENA economies lies in natural gas'

posted by Charlie Hart
10 September 2019

Countries in MENA must focus on natural gas in their economic plans as they build non-oil economies and reduce carbon footprints, according to the boss of Crescent Petroleum. 

Natural gas for generating electricity and fueling industry has become a “central aspect” to economic plans, said Majid Jafar, CEO of Crescent Petroleum.

Jafar discussed the role of gas in the transition to a lower carbon economy in the Middle East and the need for the region to develop its local gas resources at the World Energy Congress (WEC) in Abu Dhabi.

“For decades oil and gas producers in the region have flared gas as an unwanted byproduct of oil, or left their gas resources in the ground because they were considered of marginal value. Today, those resources have never been more important: natural gas equals electricity, which equals economic growth.”

Despite the abundance of gas resources in the Middle East, a combination of geopolitics, lack of infrastructure and low gas prices have hampered development in the region. 

As a result, MENA countries have often resorted to importing LNG and other forms of gas from the rest of the world, despite more than half of the worldwide gas supply sitting within the region’s borders, Jafar said. 

He added while MENA governments have begun to take steps to incentivise exploration and development of domestic gas resources, reforms were required in transparent pricing policy, upstream incentives, and the building of necessary infrastructure, in order to achieve these objectives.

Also at the event World Energy Council co-chair Jean-Marie Dauger told delegates the pace of change in the industry was accelerating quite dramatically.

“One thing we know, given the importance of the changes occurring, and what we have to do to mitigate the challenges faced, there will be no one solution for all.”

Dauger added it was essential for governments to be involved in the development of the energy sector and managing the impact of change on other sectors and issues, including social impact. 

“We know we need energy and we would need more energy in the future. The challenge is to produce it in a more sustainable way,” he continued.

“Any model of transformation in the energy system will be dominated by the issue of how to attract investments and innovation to nourish and favour the promotion of infrastructure.”

Dauger noted the UAE’s efforts in addressing the future of the energy industry. He said: “It is fair to say that the UAE has taken a very strong stance in tackling the future of energy.”

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