Natural Gas in Developing Countries: Evaluating the Benefits to the Environment

This paper promotes the cause of natural gas in the developing countries in the firm belief that their own natural gas resources offer significant opportunities for sustainable economic growth. The paper describes the size of the natural gas resource in the developing countries, gives a broad indication of its costs, and outlines its main environmental benefits as an alternative fuel. It discusses the opportunities presented by new (and old) technology for using natural gas in an efficient way to reduce air pollution and relates that to recent developments in international concerns over the world's environment. The paper gives a perspective on the extent of flaring of natural gas in the petroleum industry and on the amount of emissions of the greenhouse gases of methane and carbon dioxide during production and use. It establishes a data source for many of the parameters necessary to derive both a country and a global perspective of the opportunities for natural gas. The paper moves on to explore how the environmental benefits of natural gas can be valued with the aim of bringing that evaluation into decision processes on energy investment. It attempts to move more towards evaluating those benefits in a quantitative way and, where possible, describing them in economic terms. It examines three country case studies, and describes the way in which the respective governments approached the problems of severe air pollution and ascribe a high economic value to natural gas.