Home / Energy/ Strong LNG demand, led by Asia, may be able to absorb new supply

Strong LNG demand, led by Asia, may be able to absorb new supply


Comments / {{hitsCtrl.values.hits}} Views / Tuesday, 1 May 2018 00:00


 

Singapore (Reuters): Last year’s strong demand for liquefied natural gas (LNG), led by Asia’s major economies, is expected to continue this year and should absorb some of the new supply coming onstream, industry executives said at a conference on Tuesday.

The global LNG industry has been expecting prices to be depressed by a rush of supply as projects to produce 40 million to 50 million tons per year of LNG are coming online, mainly in Australia and the United States, over the next two years.

But, a surge in Asian demand last year took the market by surprise, with some producers now expecting the new supply to be easily absorbed by the increasing consumption across Asia.

“For the past three years, we were told at every conference that we’ll have a gas bubble, that gas is oversupplied, that we won’t be able to sell LNG... but it’s a bubble that never came,” said Jean-Pierre Mateille, vice president of trading at Total’s gas and power division.

Trade flow data on Thomson Reuters Eikon show global liquefied natural gas (LNG) imports have risen 40% since 2015, to almost 40 billion cubic metres (bcm) a month. Growth accelerated in 2017, with imports up by a fifth, largely because of rising demand in China, but also in South Korea and Japan.

China, which overtook South Korea as the world’s second-largest LNG importer in 2017, will still import large volumes of LNG this year though at a slower pace, the executives said.

China’s LNG imports soared after the government ordered millions of homes to switch to natural gas and electric heating from coal to counter rising air pollution.

This switch will continue to boost LNG imports into the country this year, Total’s Mateille told the LNG Forum 2018 conference.

Despite the new Australian and U.S. supply, demand will catch up in the long run, said Royal Dutch Shell Energy’s Executive Vice President Steve Hill.


Share This Article


DISCLAIMER:

1. All comments will be moderated by the Daily FT Web Editor.

2. Comments that are abusive, obscene, incendiary, defamatory or irrelevant will not be published.

3. We may remove hyperlinks within comments.

4. Kindly use a genuine email ID and provide your name.

5. Spamming the comments section under different user names may result in being blacklisted.

COMMENTS

Today's Columnists

Identifying traitors: I cannot wait until Dr. Padeniya presents his point scheme

Tuesday, 21 August 2018

Cause for excitement I am excited! A way of identifying and measuring a traitor is soon to be unveiled; by no less than the President of the GMOA! Hasn’t he also qualified in some department of neurology? All the more reason to justify my excitemen


The evils of translocating wild elephants

Tuesday, 21 August 2018

The subject of translocating wild elephants has been a much-debated topic recently, after the Department of Wildlife Conservation (DWLC), acting on the orders of the Minster for Wildlife, wanted to move the only two wild elephants habituating the Sin


Climate scientists cheating us to a $ 12 b/year economic loss in 2050

Monday, 20 August 2018

Local news media carried the disturbing pronouncement by World Bank economists to the effect that Sri Lanka will become an extremely hot territory with 30C temperature rise and $ 12 billion per year economic loss by 2050.


Singapore miracle – How SL could benefit from trade with Singapore

Monday, 20 August 2018

According to a media report released by President’s Media Division, a committee of experts has been appointed by the President to examine and report on ‘the practical impact and use of the proposed officer policy guidelines and recommendations on


Columnists More