Investigating the Impact of Development of Unconventional Gas Resources on Iranian Natural Gas Production: System Dynamics Approach

In recent years, in addition to conventional sources of gas, production from unconventional sources is also possible. Iran as a second-largest conventional gas reserves in the world and the fourth producer, intends to enter the gas competition, increase its share in the global gas trade. The purpose of this study is to investigate the long-term exploration, extraction and production of gas and the impact of unconventional gas production. To achieve this objective, System Dynamics approach is used. The model developed consists of three sub-system conventional gas exploration and production cycle, investment and global demand and for the period 2001-2035 is simulated. Model validity is approved and simulation results indicated that, with current trends, the life of undiscovered gas reserves in Iran from 400 years to less than 30 years will be reduce in 2035. Gas production rising from 100 BCM in 2001 to more than 500 BCM in 2035. In other words, the gas production in Iran will be about 5 times over a period of 35 years. Applying scenarios such as increasing the rate of exploration, increased investment in development and increase investment in technological improvements will lead to an increase in gas production. However, the development of unconventional gas could reduce demand security of gas in world and reduce the Iranian gas production in a long-term period. At the same time taking into account all scenarios can increase gas production and thus offset the decline in production is due to the expansion of gas production from unconventional sources