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Milton Financials: Global gas surplus threatens renewable energy investment says IEA.
Major oil companies are repositioning as natural gas producers as oil reserves become increasingly difficult to reach.
The agency said that the “golden age of gas” would lead to lower gas prices for consumers, primarily in Europe and would also lead to a rush to build gas-fired power plants at the expense of cleaner forms of electricity generation.
Chief economist for the IEA, Fatih Birol also pointed out that some of the top oil firms including Royal Dutch Shell and Exxon-Mobil were undergoing an “identity crisis” as they find themselves increasingly blocked from further development in areas such as the Middle East where most of the globes remaining oil reserves lie. These oil giants are repositioning themselves as gas producers, which firms such as Shell are promoting as a cleaner form of energy. "In terms of climate change, gas is definitely a good solution compared to coal and oil. But it's not very innocent compared to renewables and nuclear," Birol told Milton Financials.
Recent technical advances have led to a global excess in natural gas as exploration and extraction has now become possible in previously untapped shale gas, coal bed methane and tight gas deposits, most of which are found in the U.S., China and Australia. The IEA’s latest world energy outlook indicates that 35%of the increase in global gas production will come from these new sources, Milton Financials has learned.
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