14 - Integrating Climate into our Strategy Continuing to Develop Oil and Gas Production Capacity Substantial investment is needed to meet higher projected demand for gas in 2035. Given that the natural decline in production is averaging around 4% a year, the volume of production from new gas projects in 2035 is forecast to be 90% of 2010 production, even under the 2°C scenario. Growth in Gas Production Based on the 2°C scenario billion cubic feet per day 410 INVESTMENT REQUIRED 330 Natural decline 2010 According to the IEA, some USD 7.5 trillion and USD 11.1 trillion need to be invested in the gas and oil sectors respectively over the next 20 years. This represents increases of 41% and 23% compared to average annual investment in these sectors between 2000 and 2013. New projects 2035 (IEA 2°C scenario) Similarly, additional spending will also be required to meet oil demand in 2035. Given the natural decline of output, the volume of production from new oil projects in 2035 is forecast to be 75% of 2010 production, even under the 2°C scenario. Meeting the 2°C target will be based in large part on continuously improving energy efficiency and targeting energies more effectively in line with uses. Gas and renewables are therefore expected to be primarily dedicated to power generation, replacing coal and, to a lesser extent, heavy fuel oil. The use of oil will have to be concentrated on transportation and petrochemicals, sectors in which it remains indispensable. But other energies — electricity, gas and renewables in particular for transportation — will play an increasingly important role. The use of renewables will expand rapidly. But their deployment at a global scale will, in fact, take place in stages. The transportation sector, which currently accounts for over 55% of oil demand, is an example of this. According to the 2°C scenario, biofuels and electricity will grow at a faster pace between now and 2035, but will still only meet a small portion of transportation demand.