Page 11 - MEOG Week 46

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Gas OPEC? together, the GECF can become a force for good
GECF was only founded in 2001, some five and a balancing factor in the gas business,” he
decades after OPEC’s launch in 1960. Its full said. “Nigeria would want to see more dialogue
members are Algeria, Bolivia, Egypt, Equatorial and more collaboration among member coun-
Guinea, Iran, Libya, Nigeria, Qatar, Russia, Trin- tries, gas consumers and regional and interna-
idad and Tobago and Venezuela, while Angola, tional organisations.”
Azerbaijan, Iraq, Kazakhstan, Malaysia, Norway, His Venezuelan counterpart, Tareck El
Oman, Perua and the UAE have observer status. Aissami, was more overt, calling for the GECF to
The group has traditionally lacked its oil develop “the political will to take far more deci-
counterpart’s ability to assert pressure on prices, sive actions to control the gas market and obtain
even though it controls over half of global gas fair benefits for gas producing countries.”
exports. This is primarily because of the nature The group must establish “mechanisms of
of the gas market. effective interaction to maximise revenues of
Gas is mostly sold via pipeline directly from a member countries by balancing and stabilising
supplier to a consumer, making the market fairly markets,” he said.
regionalised and pricing inflexible. The market GECF Secretary General Yury Sentyurin has
for oil is far more international. also spoken in favour of closer co-operation, say-
As a result of a surge in LNG trade over recent ing in June that he considered OPEC a “model”
years, however, the gas market has grown more for GECF’s activities.
global in nature. “Maybe not, it’s high time that the gas and oil
Suppliers have access to many more buyers industry implements the knowledge and solu-
and vice versa, and the duration of supply con- tions of the oil industry. To use the best practices
tracts has also been steadily shortening. demonstrated by your community,” he said.
There has also been a move away from oil-in-
dexed prices to hub rates, and restrictive desti- Resistance
nation clauses are being phased out. All these The obstacle to OPEC-style joint action is likely
trends have made the market more competitive. to be Qatar, the biggest LNG exporter in the
It is unclear whether the mechanisms Shulgi- world, which has dismissed talks of co-ordinat-
nov was referring to could involve co-ordinating ing global gas supply in the past. The Gulf state
supply in the manner of OPEC. But officials from claims to have the lowest production costs in
a number of other GECF have also called for the the world, meaning it is better able to withstand
group to do more to manage the market. weak prices and has less incentive to form a sup-
Algerian Energy Minister Abdelmadjid Attar ply pact.
noted on November 11 that there was currently Any restrictions on production would also
no means for sovereign countries to co-operate interfere with Qatar’s ambitious LNG expansion
and bring about greater stability in the gas mar- plans. Qatar is looking to raise its liquefaction
ket, unlike their oil-producing counterparts. capacity by 33mn tonnes per year by the mid-
“This is maybe an opportunity to explore 2020s to 110mn tpy, and then to 126mn tpy
through innovative thinking, possibilities for towards the end of the decade.
such [co-operation] to be put in place for the Qatar Energy Minister Saad al-Kaabi made
benefit of exporters, consumers and the indus- no reference to closer co-operation in his open-
try,” Attar said. ing remarks to the meeting. Instead, he only said
Nigerian Energy Minister Timipre Sylva the group should continue advocating for gas “to
meanwhile suggested that GECF could become the best of our ability.”
a “balancing factor” in the market. “We are charged as a forum to enhance gas
“With 71% of the global gas reserves in the business around the world and try to promote
hands of GECF members we believe that acting gas,” he said.™

Week 46 18•November•2020 www. NEWSBASE .com P11