Energy Investing: Natural Gas Reserves - dummies

Energy Investing: Natural Gas Reserves

By Nick Hodge, Jeff Siegel, Christian DeHaemer, Keith Kohl

Some would-be energy investors are hesitant to invest in the oil and gas industry because it is dominated by national oil companies (NOCs). An NOC is a company that’s owned — either wholly or through a majority stake — by a national government.

A few of the most recognizable names include Saudi Aramco, Gazprom, China National Petroleum Corporation (CNPC), Petróleos de Venezuela (PDVSA), Petróleos Mexicanos (Pemex), Oil and Natural Gas Corporation Limited (ONGC), Statoil, and Petróleo Brasileiro (Petrobras).

Are fears of investing in oil and gas abroad unfounded? Even some of the largest public oil and gas companies in the world get the short end of the stick from NOCs sometimes. Exxon was ousted from Venezuela after then-President Hugo Chavez nationalized the country’s oil industry and took possession of foreign oil assets still in the country.

The world’s top oil-producing countries are a veritable who’s who of countries with powerful NOCs. More than half of the global production and nearly 90 percent of the world’s proven oil reserves are in the hands of these companies.

The same can be said about natural gas. NOCs control about the same percentage of global gas production but less than 70 percent of the world’s gas reserves. This table shows you the top ten countries by natural gas reserves.

Top Ten Countries by Proven Gas Reserves
Country Proven Gas Reserves (Trillion Cubic Meters)
Russia 55 Tcm
Iran 33.5 Tcm
Turkmenistan 26.2 Tcm
Qatar 25.4 Tcm
United States 9 Tcm
Saudi Arabia 8.2 Tcm
Azerbaijan 6 Tcm
Venezuela 5.5 Tcm
Nigeria 5.2 Tcm
Algeria 3.8 Tcm