THE HAGUE, NETHERLANDS: Global demand for liquefied natural gas (LNG) reached 265 million tonnes (mt) in 2016 – enough to supply power to around 500 million homes a year. This included an increase in net LNG imports of 17 mt.
Many expected a strong increase in new LNG supplies would outpace demand growth during 2016. Instead, demand growth kept pace with supply as greater than expected demand in Asia and the Middle East absorbed the increase in supply from Australia, according to Shell’s first LNG Outlook.
China and India – which are set to continue driving a rise in demand – were two of the fastest growing buyers, increasing their imports by a combined 11.9 mt of LNG in 2016. This boosted China’s LNG imports in 2016 to 27 mt and India’s to 20 mt.
Total global LNG demand increased following the addition of six new importing countries since 2015: Colombia, Egypt, Jamaica, Jordan, Pakistan and Poland. They brought the number of LNG importers to 35, up from around 10 at the start of this century.
Egypt, Jordan and Pakistan were among the fastest growing LNG importers in the world in 2016. Due to local shortages in gas supplies, they imported 13.9 mt of LNG in total.
The bulk of growth in LNG exports in 2016 came from Australia, where exports increased by 15 mt to a total of 44.3 mt. It was also a significant year for the US after 2.9 mt of LNG was delivered from the Sabine Pass terminal in Louisiana.
LNG prices are expected to continue to be determined by multiple factors, including oil prices, global LNG supply and demand dynamics and the costs of new LNG facilities. In addition, the growth of LNG trade has evolved into helping meet demand when domestic gas markets face supply shortages.
LNG trade is also changing to meet the needs of buyers, including shorter-term and lower-volume contracts with greater degrees of flexibility. Some emerging LNG buyers have more challenging credit ratings than traditional buyers.
While the industry has been flexible in developing new demand, there has been a decrease in final investment decisions for new supply.
Shell believes further investments will need to be made by the industry to meet growing demand, most of which is set to come from Asia, after 2020.
In China, a government target has been set for gas to make up 15 percent of the country’s energy mix by 2030, up from 5 percent in 2015. Meanwhile, Southeast Asia is projected to become a net importer of LNG by 2035, a significant transformation for a region which includes Malaysia and Indonesia – currently among the major LNG exporters in the world.
“Global LNG trade demonstrated its flexibility time and again in 2016, responding to shortfalls in national and regional gas supply and to new emerging demand. The outlook for LNG demand is set to grow at twice the rate of gas demand, at 4 to 5 percent a year between 2015 and 2030,” said Maarten Wetselaar, integrated gas and new energies director at Shell.
© Worldofchemicals News
Read More: Shell launches first global LNG market outlook
No comments:
Post a Comment