Nigerian Vice-President Namadi Sambo joined other leaders of the world's biggest gas suppliers in an inaugural gas summit in Doha, Qatar on Tuesday by calling for a fair gas price. Meanwhile, Iran, whose president was absent from the ceremony, warned that Western taxation will derail the energy market.
The summit was opened by Qatar's Emir Sheikh Hamad bin Khalifa al-Thani who called for "innovative solutions" to the challenges facing the gas industry for the benefit of both consumers and producers.
According to organisers, the summit was to discuss "the priority of long-term contracts as the basis of security for exporters and consumers of natural gas."
It was also seek ways to establish a fair price for gas under a gas-to-oil indexation, with the aim of overcoming the disparity between crude oil and gas prices, organisers said.
The leaders would review cross investments and technological collaboration between GECF members.
Besides Oman which was admitted on Sunday, the GECF also comprises Algeria, Bolivia, Egypt, Equatorial Guinea, Iran, Libya, Nigeria, Qatar, Russia, Trinidad and Tobago, and Venezuela. Kazakhstan, Norway and the Netherlands are observers.
Russia is the world's largest gas producer and sits on 30 percent of global reserves, while Qatar is the largest liquefied natural gas (LNG) exporter with a production capacity of 77 million tonnes a year.
GECF has been working for a fair gas price which its leaders say is the fastest growing energy source, but they deny it aims to control prices or become a cartel like the Organisation of Petroleum Exporting Countries (OPEC).
The producers want "a fair price for gas that is linked to an energy commodity, especially crude oil ... Gas prices are not yet in parity with oil," Qatar's Energy Minister Mohammed bin Saleh al-Sada told reporters on Sunday.
“Fair prices are determined by demand and production (supply). It is not the duty of this forum to determine prices," he said.
"The summit wants to send a message (to the world) about reliable gas supplies," Sada said.
Gas prices are currently determined either in long-term contracts between sellers and buyers, which some exporter’s index to oil, or on spot markets.
World gas demand dipped in the wake of the global financial crisis but the GECF says it rebounded last year, rising 7.3 percent, mainly due to Japan boosting LNG imports after its March tsunami and nuclear crisis.
The International Energy Agency estimated last month that around $10 trillion of investments would be needed in the gas industry until 2035, or about $400 billion a year.
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