Natural gas trade in Asia and the Middle East

This report explores the economic and technical potential for expanded gas trade to benefit developing countries in Asia and the Middle East; it reviews the region's resource base and gas markets and then discusses viable schemes, elaborating some key issues and principles for formulating gas trade projects. Challenges in forming gas trade projects include pricing reform to make gas prices financially viable; improving contractual arrangements for long-term gas sales and transit arrangements; installing an internationally acceptable legal and regulatory framework; engaging private sector participation; structuring feasible plans to resolve financing and operating issues and to reduce risk. The report concludes that given its environmental benefits and high market value, natural gas should expand its role, resulting in an increase in transnational gas projects with developing countries serving as gas exporters, importers, or transmitters. The World Bank's role in providing technical and financial assistance should expand accordingly, particularly in providing guarantees enabling appropriate financing.