Arab countries hold about 29 percent ofthe world's proven gas reserves, but every country(except Qatar and Algeria) is short of the gas supply neededto meet its current and projected demand. The rapid growthin gas demand is mostly a consequence of a sharp increase inelectricity consumption. Gas trade in the Arab world hasbeen dominated by the objective of exporting gas in the formof liquefied natural gas (LNG) to points in Asia, Europe,and North America. Gas trade within the region is limited torather small volumes, moved from Algeria to Tunisia andMorocco; from Egypt to Jordan, Syria, and Lebanon; and fromQatar to the United Arab Emirates (UAE) - all throughpipelines. The shortage of gas in the Arab countries hasbecome more pronounced, justifying the higher gas pricesneeded to secure imported gas or to encourage domestic gasproduction. Such changes in the landscape provide an impetusfor the Arab world to optimize the region's gasresources, at least partly on the basis of meeting growingregional demand. The objective of this study is to assistthe attempt by: (i) identifying the opportunities for gastrade through cross-border gas pipelines and LNG; (ii)assessing the economic and political aspects of theidentified projects; (iii) presenting financing andimplementation schemes that utilize the synergy between thepublic and private sector in project formulation anddevelopment; and (iv) reviewing the legal, regulatory, andcontractual requirements conducive to regional gas trade.The study focuses on 16 Arab countries situated in theMiddle East and North Africa (MENA). Although the MENAregion includes some high-income countries (Saudi Arabia,Kuwait, the UAE, Qatar, and others), the emphasis of thestudy is on the low- and middle-income countries of theregion. The study draws upon publicly available informationon gas reserves, demand, and supply to carry out an economicanalysis of gas trade projects and identify the prospectiveprojects for implementation in the short to medium term.
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