Gas Demand to Rise after Japan Crisis Conoco Says

March 23, 2011
Company predicts hydrocarbons, mainly oil and natural gas, will be leading sources of energy over the long term, filling 80% of demand in 2035

U.S. energy group ConocoPhillips said on March 23 that the demand for liquefied natural gas would rise after Japan's quake disaster crippled a key nuclear power plant in the country.

Conoco's chief strategist Al Hirshberg told analysts that the Japanese disaster could lead other countries as well to pull back on nuclear power plants, providing LNG producers new opportunities.

"The world's governments are starting to reconsider some of their former plans for nuclear power," he said. "I expect it is going to move up as Japan uses more LNG to replace (nuclear) power."

Conoco is a major producer of LNG, from plants in the United States, Australia, and Qatar.

Generally speaking, Hirshberg said, hydrocarbons, mainly oil and natural gas, would remain by far the leading sources of energy over the long term, filling 80% of demand in 2035.

Conoco is pushing further into exploration and production, he said.

But in the wake of the Japanese disaster and the massive oil leak last at a Gulf of Mexico platform operated by BP, which forced a temporary freeze on drilling in the area, have made the political environment for exploration more difficult, he said.

Conoco also expected higher exploration costs due to the heavy competition for access to resources in a number of regions around the world, he said.

Copyright Agence France-Presse, 2011

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