Asia-Pacific said to dominate oil demand by ’20
The Asia-Pacific (Apac) is a growing market for oil and gas resources, and member-countries are expected to make long-term investments in the industry, according to a think tank based in the United States.
The James A. Baker III Institute for Public Policy said in a report that, from 2000 to 2010, Apac accounted for 56 percent of the increase in global primary oil demand. The Baker Institute estimates that the region may account for 70 percent of global oil demand from 2010 to 2020.
As the region presently has few oil and gas producers, relying heavily on imports, growth in demand is an opportunity for international companies to tap exploration/production and refining.
Industry stakeholders agree.
Ahead of the OSEA 2014 International Conference in Singapore this December, keynote speakers John Westwood (Douglas-Westwood Group chairperson) and Dan Eberhart (Canary USA CEO) said in a statement that Apac would be boosted by the development of onshore and offshore gas markets, driven by growing regional demand and high gas prices in Japan and South Korea.
Eberhart said the exploration and development hotspots would be the South and East China Seas.
“The biggest challenge in those areas is the territorial disputes between neighboring countries. The South China Sea, for example, is shared among Vietnam, China, Philippines, Taiwan and others,” Eberhart said. “Of course, it’s not much easier for international oil companies there, which also must navigate the aggressive offshore drilling claims.”
At the same time, he said, growing demand for gas in Myanmar has turned the Bay of Bengal into an offshore hotspot. There are continuous disputes in that area that will require new arbitration and rules.
Yet there are opportunities even for non-producers. Eberhart said Singapore is a good example because it has attracted multibillion-dollar fixed capital investments by major oil companies for oil refining.
“The country’s transparent business and mature legal and financial systems have made it very attractive to gas stakeholders. It may be a non-oil producing country, but they’ve made oil refining central to their economy,” Eberhart said.
In order to assure its industrial future, the Apac region needs to take a long-term view on energy, not only by increasing supplies and their diversity, but by improving energy efficiency, Westwood said. “In this, the need for progressive removal of fuel subsidies in countries such as Indonesia is a vital element.” Riza T. Olchondra
