May 09,2023

AMMAN — The Jordan Strategy Forum (JSF) on Monday released a policy paper titled “Natural Gas Resource in Jordan: Available Opportunities within the Path of Economic Modernisation Vision”.

The paper aims to shed light on Jordan’s energy sector, with a particular focus on the potential of leveraging its natural gas reserves to foster economic development.

Recognised for its environmental friendliness among the non-renewable energy sources, natural gas holds significant economic importance due to its multiple applications across various industries, including manufacturing, household consumption, commercial use and electricity generation.

The forum revealed that Jordan’s 2021 energy mix was composed of oil derivatives at 45.5 per cent, while natural gas constituted 37.5 per cent, and renewable energy sources accounted for 14.3 per cent. 

Although the contribution of natural gas, renewables and crude oil is above the anticipated contributions outlined in the Kingdom’s 2030 goal, Jordan’s energy landscape remains heavily reliant on imported sources. Nonetheless, the country has witnessed a decrease in import dependency from 90 per cent in 2019 to 84 per cent in 2021.

The forum highlighted that Jordan’s energy sector is experiencing a positive trend in increasing the share of locally produced energy in the overall energy mix. Local energy production rose from 10 per cent in 2019 to 11 per cent in 2020, and reached 16 per cent in 2021. Regarding locally produced energy, natural gas constituted the largest share at 91.9 per cent, while oil accounted for the remainder.

As for energy imports, Jordan’s prominent sources included crude oil at 40.8 per cent, diesel at 21.2 per cent, gasoline at 20.9 per cent and liquefied petroleum gas at 8.7 per cent.

In light of the globalised gas market, the forum emphasised the necessity of diversifying energy sources to mitigate potential economic shocks. Moreover, the forum underscored the ongoing challenge of servicing legacy debts resulting from the interruption of the Egyptian gas supply. Jordan’s gas imports from Egypt declined from approximately 63.5 per cent in 2010 to around 37.5 per cent in 2011.

The transportation sector was the largest consumer of energy, representing 43 per cent of the total energy consumed in 2021, according to the forum.

Accordingly, the forum noted the importance of enhancing Jordan’s productive capacities and developing high-value-added industries fueled by natural gas.

The paper also stressed that natural gas initiatives related within the Economic Modernisation Vision will significantly enhance energ efficiency across all sectors, recommending that the country diversify all forms of energy sources to mitigate the risk of economic vulnerabilities.