(EnergyAsia, January 20 2015, Tuesday) — Helped by expected weak prices in 2015, the world’s import of liquefied natural gas (LNG) will reach a record of more than 250 million tons for the first time, said Australia’s Department of Industry.
“After four relatively flat years, global LNG imports are expected to increase more rapidly in 2015,” said the department in its latest resources and energy quarterly report for December 2014.
“Low spot prices are expected to be particularly important in increasing European, Middle Eastern and South American imports. Increased regasification capacity will support greater imports into Southeast Asia and China, where growing energy demand and more competitive LNG prices will also result in increasing gas use,” it said.
According to energy media Platts, spot LNG prices for delivery to Asia, the world’s largest market for the fuel, have fallen to a four-year low of US$9.911 per million British thermal units (/MMBtu). After holding mostly above US$15 since 2011, prices have fallen as LNG sold to Asia is linked to crude oil prices, which have plunged by 60% since mid-2014. Traders expect oil prices to remain weak this year.
Asian LNG imports will grow from an estimated 182 million tons in 2014 to 188 million tons in 2015, said the Australian Department of Industry.
It expects global liquefaction capacity to rise to 258 million tons, up 5.3% from around 245 million ton in 2014 and 2013, due largely to new projects in Australia and resumption of operations at Angola’s Soyo plant.
Papua New Guinea’s new export facility was the only new project to have started up last year, offsetting declines in Africa.
Australia’s gas outlook
unit 2012–13 2013–14 2014–15 forecast %
Production (a) bcm 62.1 62.8 67.2 7.0
LNG export volume Mt (b) 23.8 23.6 26.2 11.2
– real value (c) A$m 15,034 16,745 17,568 4.9
(a). Production includes both sales gas and gas used in the production process (i.e. plant use).
(b). 1 million tonnes of LNG is equivalent to approximately 1.36 billion cubic metres of gas.
(c). In current financial year Australian dollars.
Sources: ABS, Company reports and World Bank.