Oil and Gas World Brief Overview
Whilst gas field exploration and developments use similar technology to Oil, the gas sector is different economically. The high cost of transporting gas (up to ten times the cost of transporting oil) means that gas field developments cannot be considered in isolation, but need to be developed in conjunction with investment in transportation infrastructure (pipelines or liquefaction systems) and the related demand markets.
Thus gas prices and contracts are often specific to a locality - country or region. The exception to this is where the gas sector - markets and infrastructure are Well developed - as in the UK, Europe and US - where, with suitable de-regulation, there can be more of a genuine market-driven price.
There is increasing interest in gas world wide, with demand for gas currently growing and forecast to grow at a higher rate than oil over the next two decades. This is being driven partly by the availability of gas and its attractions on environmental grounds. It is also leading to increasing interest and development of Gas To Liquids technology in which gas is converted to a more concentrated liquid form to facilitate the exploitation of remote and smaller gas reserves.
Major oil companies such as Shell are moving into gas, seeing declining business opportunities in non-OPEC countries. Further, the importance of power generation as a market for gas is encouraging companies to become involved in both gas and power utilities.