New Horizons for Gas in Europe
- Edward Symonds
- Document ID
- Society of Petroleum Engineers
- Journal of Petroleum Technology
- Publication Date
- May 1964
- Document Type
- Journal Paper
- 499 - 502
- 1964. Original copyright American Institute of Mining, Metallurgical, and Petroleum Engineers, Inc. Copyright has expired.
- 4.6 Natural Gas, 4.3.4 Scale, 4.2 Pipelines, Flowlines and Risers
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SYMONDS, EDWARD, FIRST NATIONAL CITY BANK NEW YORK, N.Y. MEMBER AIME
Since 1956, when extensive gas reserves were discovered in Africa and Libya, and the discovery of the Groningen field in The Netherlands in 1960, the picture for a strong gas industry in Europe has been growing more distinct. Advances in gas transportation and storage are contributing to the prospect for gas usage in Europe. Although the present usage is low, the possibilities for favorable costs in relation to competing energy sources and the potential demand show the market is there. In addition to domestic usage, industrial markets can be developed for the future. Political as well as economic forces are discussed in relation to developing the gas markets in Europe.
For some years, natural gas was the neglected child of the petroleum business. The position in the United States, where it accounts for nearly one-third of the primary energy used, was regarded as exceptional if not unfortunate, and there was a tendency to overlook the few other areas where it has reached a high state of development. Today, the enormous and rapidly growing hunger for energy outside North America suggests that gas will take its place alongside oil, and of comparable importance, in other major markets. In this transition, the lead is likely to be taken by Europe. This remained a somewhat remote possibility so long as the gas had to be brought nearly 3,000 miles from the large Middle Eastern reservesfor which substantial markets have still to be developed. Following the first Saharan finds in 1956, discovery that North Africa possessed both those reserves, now estimated at 55 Tcf, and extensive others in Libya, promised to change this picture. In 1960, the accessibility of gas to European consumers was still further increased by the discovery in The Netherlands of what has since proved to be the second largest field in the world. The Groningen reserves, now estimated at almost 39 Tcf, put The Netherlands ahead of Canadaalready a major gas-producing country with an area more than 250 times as large.
Progress in Gas Transportation
The prospect for gas usage in Europe is being further improved by advances in transportation and storage. Experience in North America has amply demonstrated the capacity of pipelines to transmit gas to remote consuming markets at highly competitive prices. With a cost of transportation from Texas to the New York area approximately 25cts/Mcf, or from the Alberta fields to San Francisco of 20cts/ Mcf, the low energy/volume ratio (and therefore low flexibility) of natural gas in relation to oil has been largely overcome in this Continent. But transportation costs here were not directly comparable with those in Western Europe so long as Middle Eastern or North African gas reserves were the only ones in sight. It has been estimated that the cost of a normal water-crossing is about twice that for a comparable pipeline laid on land.
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