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By Anthony DiPaola, Tracy Alloway and Mahmoud Habboush (Bloomberg) — U.S. natural gas exports could find buyers in the oil-rich Persian Gulf as countries there look to meet surging demand.
Growing U.S. exports of liquefied natural gas could be an additional source of gas supply to the region, U.S. Secretary of Energy Rick Perry and U.A.E. Energy Minister Suhail Al Mazrouei said Wednesday at a news conference in Abu Dhabi. Jordan, the U.A.E. and Egypt have been buyers of LNG from the Sabine Pass complex in the U.S. the past two years, according to Bloomberg vessel tracking, IHS Markit Ltd. and Genscape.
“We want to be in the mix of LNG suppliers for the Mideast,” Perry said at the news conference. “Creating a relationship, having these conversations is good, it gives the U.A.E. some options.” The U.S. offered gas to Saudi Arabia, he said.
Gulf oil producers like Saudi Arabia and the U.A.E. rely on gas to power their industries, run household air conditioning units and support petrochemicals production. While the Gulf is rich in crude oil, its gas resources are concentrated in just a few countries. Qatar and Iran share the world’s biggest gas deposit, located in the Persian Gulf.
The U.S., flush with supply of gas and oil from cracking open shale deposits, has one LNG export facility and is working to bring others on line. The U.S. and Australia, also developing an LNG export market, could rival Qatar as the world’s biggest supplier if they complete all their projects. The possibility of more shipments from the U.S. comes as the U.A.E. and Saudi Arabia are leading a trade ban against Qatar, currently the world’s LNG producer.
U.S. suppliers and U.A.E. buyers have held talks about trading more of the fuel, Mazrouei said in an interview in Abu Dhabi. Electricity use in the region is rising about 6 percent a year, requiring increased supplies of gas, he said.
“It’s an open market and we welcome all of the companies from the U.S. to come and explore this market,” Mazrouei said.
Even as more imports become available, the U.A.E. wants to wean itself off foreign gas. The country’s contract for supply of natural gas from Qatar through the Dolphin Energy Ltd. pipeline expires in 2032.
“We can achieve self-sufficiency by 2030,” Mazrouei said. That can occur as more renewable energy projects come on stream, he said.
The U.S. and U.A.E. agreed to expand cooperation in development, trade in oil, gas, coal, LNG, and technologies related to carbon capture, use and storage during meetings this week. Perry also discussed civilian nuclear projects with the U.A.E. and Saudi Arabia.
© 2017 Bloomberg L.P
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