Gas forum ready for first summit
2011-11-13 12:51
Doha - Energy ministers of the Gas Exporting Countries Forum met on Sunday to prepare for the first ever summit of the 11-member group which will discuss fair prices and stronger coordination.
The GECF, whose members hold just under 70% of world's gas reserves, have been vying to establish a mechanism to set fair prices for natural gas to reflect parity with oil.
Iranian President Mahmoud Ahmadinejad and Algerian leader Abdelaziz Bouteflika are among the heads of state who will attend the one-day summit on Tuesday in the Qatari capital Doha, organisers said.
According to the GECF, the summit will discuss the priority of long-term contracts as the basis of security for exporters and consumers of natural gas.
It will also seek ways to establish a fair price for gas under a gas-to-oil indexation with the objective to overcome the disparity between crude oil and gas prices, the organisers said.
The leaders will also review cross investments and technological collaborations between GECF members who include Russia, Iran and Qatar.
Russia is the world's largest gas producer and sits on 30% of global reserves, while Qatar is the largest liquefied natural gas (LNG) exporter with a production capacity of 77 million tonnes a year.
Gas prices are determined either in long-term contracts between sellers and buyers, which some exporters index to oil, or on spot markets.
World gas demand dropped by 2.1% in 2009 due to the global economic recession, but the GECF says it rebounded last year, rising by 7.3%, mainly due to Japan boosting its LNG imports in the wake of the March tsunami and nuclear crisis.
The GECF group includes Algeria, Bolivia, Egypt, Equatorial Guinea, Iran, Libya, Nigeria, Qatar, Russia, Trinidad and Tobago, and Venezuela. Kazakhstan, Norway and the Netherlands are observers.