Natural gas supply

Many people are familiar with natural gas from its use in homes for cooking and heating, but it is also an important fuel for power generation and is used to manufacture chemicals and plastics.

In recent decades natural gas has seen a growing role in power generation thanks to increased availability, flexibility and lower CO2 emissions than coal and oil, but emissions from natural gas will still need to be reduced significantly to meet international climate goals. The global energy market disruptions following Russia's invasion of Ukraine have also demonstrated the energy security risks of reliance on imported gas, particularly in Europe.

The natural gas supply includes production and imports minus gas that is exported or stored.

Domestic gas production

Like oil, natural gas is pumped from deposits underground or beneath the sea floor. Once extracted, gas must be processed and is then distributed by pipelines to end users such as power plants and homes. In recent decades, new technologies like hydraulic fracturing ("fracking") have enabled the extraction of natural gas from places where it was previously uneconomical to do so.

Gas imports and exports

The trading of natural gas is largely shaped by geography, as most natural gas is transported via fixed pipelines from the (often remote) locations where it is extracted to final customers hundreds or thousands kilometers away. Reliance on natural gas imported by pipeline can create energy security risks, as demonstrated by the global energy crisis following Russia's invasion of Ukraine in 2022.

Liquified natural gas (LNG) technology has opened up new possibilities by allowing gas to be transported in tanker ships, much like oil, though the infrastructure required is complex and expensive and a pipeline network is still needed to distribute the gas to end users.

CO2 emissions from natural gas

Although burning natural gas emits considerably less CO2 (and other pollutants) than coal or oil, it remains a significant source of emissions that must be reduced to meet international climate goals.

Methane, the primary component of natural gas, is a potent greenhouse gas. Leaks from gas pipelines and processing facilities, as well as the intentional venting or flaring of unwanted gas at production sites, mean that oil and gas extraction operations themselves are substantial contributors to climate change, even before any fuel is burned. Note that the numbers below include only emissions from burning natural gas, and not from this "fugitive" methane.

Natural gas in electricity generation

Natural gas has become an increasingly popular option for electricity generation in many countries due to increased availability and the fact that it emits less CO2 and other pollutants than coal. Gas power plants can also be turned on or off relatively easily, which allows for greater flexibility in dealing with demand peaks or low supply from other sources. However, as the energy crisis following Russia's invasion of Ukraine shows, reliance on imported natural gas for electricity can lead to painful price spikes when supplies are disrupted.

Final consumption of natural gas

In addition to power generation, natural gas is widely used for heating and cooking and is an important fuel for many industrial processes. The major non-energy use for natural gas is the production of key chemicals used to manufacture fertilizers and plastics.

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