UCL Institute for Sustainable Resources


Daniel Welsby

Dan graduated from UCL in 2015 with an MSc in Economics and Policy of Energy and the Environment (EPEE). His MSc Dissertation focused on the production potential of the Marcellus shale play and uncertainty over geological decline parameters.

Dan has worked for the UNECE/OSCE in a sub-contracted research role on the diversification of energy balances, and in particular the role renewable energy might play in the OSCE-UNECE region.

Research subject

Supervisors: Paul Ekins, Christophe McGlade, Steve Pye

Modelling Global Natural Gas Resources

Under the IEA’s New Policies Scenario, natural gas consumption demand is projected to increase approximately 56% between 2012 and 2040, with the main driver of demand in non-OECD Asia (India and China in particular). Given the perceived central role of natural gas in future global energy balances, understanding the impact of increased natural gas consumption on energy-environment-economic interactions is crucial.

The research into natural gas markets will follow a similar pattern to BUEGO (Bottom-Up Economic and Geological Oil Field Production Model) developed by Christophe McGlade, in aiming to replicate investment decisions in the development of natural gas resources at a field-level. However, unlike oil markets, natural gas remains a predominantly regional commodity – with several price formation mechanisms and the majority of trade conducted on a regional level – and thus, the research aims to generate endogenously determined regional prices required to satisfy global demand. The broad aims of the model include:

  • Bottom-up, geological, resource estimates based on field-level data, and corresponding supply-cost curves for each region and resource category (conventional (onshore and offshore) and unconventional gases (coal-bed methane, shale, tight gas));
  • Investment decisions based on the above geologically derived resource cost curves and regionalised price formation mechanisms;
  • Natural gas trading dynamics – including the role potential pricing (including global price convergence) and mitigation (e.g. natural gas as a ‘bridge’ or further fossil fuel lock-in?) scenarios will play in terms of the volume of natural gas trade, given infrastructural (LNG and Pipeline) constraints.
  • Implications of regionalised water-use in shale gas extraction;
  • The environmental-climate implications of increased natural gas use (using the whole energy system TIMES Integrated Assessment Model (TIAM) at UCL).