Natural gas. Natural Gas Embedded in Seas Close to Japan Natural gas reserves are abundant

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3 About Natural Gas Clean Energy, Natural Gas Natural Gas as an Unconventional Resource Emissions of combustion by-products from fossil fuels (Coal = 100) Natural gas, which is primarily composed of methane, when burned, generates only small amounts of carbon dioxide that is the key contributors to global warming and Projects for realizing use of unconventional natural gas Unconventional natural gas resources (shale gas, tight sand gas and coal bed methane) have been implemented. Reserves of unconventional nitrogen oxide emissions that causes photochemical smog, Coal 100 respectively-and zero sulfur oxide emissions, the principal cause of air pollution and acid rain. For this reason, natural Oil 80 Natural gas 60 Coal 100 Natural gas 40 Coal 100 Oil 70 SOX NOX CO2 gas, as a clean environment-friendly energy source, is Oil 70 Natural gas 0 Souce -white paper on energy 2011 (Ministry of Economy, Trrade and Industry, Govemment of Japan) gaining in popularity around the world. natural gas are estimated to be more than 300 years of current natural gas production. In the U.S.A., that produces about 20% of the world s natural gas, more than 50% of Coal bed methane Conventional natural gas Tight sand gas the natural gas produced is unconventional natural gas; this percentage is expected to increase in the future. Shale gas Natural Gas Embedded in Seas Close to Japan Natural gas reserves are abundant It is said that methane hydrate sufficient to meet Japan s Thanks to advances in mining technology, natural gas Natural gas reserves are abundant and, unlike those of crude oil, are not concentrated in any specific geographical embedded under the sea or deep underground, formerly locations. Scientists estimate that current reserves are difficult to collect using conventional methods, can now be sufficient to fuel the world s energy needs for more than 60 produced efficiently, leading to expectations of a stable years. natural gas supply in the future. natural gas requirements for about 100 years is embedded Embedded area of methane hydrate under seas close to Japan. The methane hydrate development project in Japan aims to develop a technology to extract methane hydrate as natural gas by In February 2012, the first marine production test in the world began offshore in Aichi Prefecture. The technical foundation necessary for Global Distribution of Natural Gas Deposits Other Europe 34.1 The other Middle East 15.8 Africa 14.5 Russia 44.6 Iran 33.1 Qatar 25.0 Other Asia 4.2 United Arab Emirates 6.1 TOHO GAS CO.,LTD. Annual Report 2012 (2016 to 2018). Uses of Natural Gas in Japan Canada 2.0 While Japan produces very little natural gas, it imports a China 3.1 Malaysia 2.4 Brunei 0.3 Indonesia 3.0 Australia commercial hydrate production will also be developed Source BP Statistical Review of World Energy 2012 Trillions of cubic meters Proved Natural gas deposits 208 Trillions of cubic meters The United States 8.5 Mexico 0.4 Reserveproduction ratio about 64 years Latin America 7.6 In Japan, the use of natural gas as a primary energy great deal in the form of liquefied natural gas (LNG). source is still quite low compared with consumption in the Because such LNG projects as gas field development and European Union and North America. However, in recent liquification plants require huge sums of capital, gas years, demand for natural gas in Japan has expanded producers and importing companies make a practice of owing to wider use of large-scale generators at electric entering into long-term contracts to ensure a stable return power plants, as well as the proliferation and enlargement on their capital investment over the long term. of systems with high generating efficiency that utilize city LNG receiving terminals in Japan are chiefly built at the ports of Tokyo, Osaka and Nagoya, where demand is highest, and the gas is then supplied to power plants and gas for such applications as cogeneration systems, gas-powered air-conditioning systems and plant furnaces. The expansion of nuclear power generation in Japan these major cities and their vicinities through gas pipelines. has become difficult due to the nuclear power plant With an abundance of mountain ranges in the country and accident at Fukushima caused by the tsunami after the the population disproportionately located in urban areas, Great East Japan Earthquake. Since it takes a considerable there is no integrated long-distance pipeline connecting time for the diffusion of renewable energy use, the major cities, so that each natural gas market is autonomous importance of natural gas, which is clean and enjoys supply to all others. stability, is expected to further increase. TOHO GAS CO.,LTD. Annual Report

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