Competitive Gas

Abstract

In 2007, European gas production decreased for the second consecutive year

Domestic production, which currently represents 39.8% of European consumption (down from 43% in 2006), has generally continued to decrease over the period. The fall in domestic production reached 6.4% in 2007, after a 4.6% drop in 2006, and a 7.1% drop in 2005. It represents a 14.3% decline of indigenous production in five years. This drop can be partly attributed to mild winters of 2006/2007 and late 2007, as well as high energy prices which drove the consumption down, but the main explanation comes from the fact that most European gas producing countries have reached their peak production and are now experiencing reserves decline. The most significant decrease in production volumes comes from the UK, where production dropped abruptly by 9.5%, accounting for 79% of domestic consumption, down from 88% in 2006 (see Table 4.1). The Netherlands also continued its structural decline with a slight decrease of 1.2%. These two countries are the largest European producers, accounting for over 71% of EU-27 production. Significant decline in production also occurred in Italy (-11.5%), Denmark (-11.4%), Germany (-8.4%) and Romania (-3.1%).