ASIA'S LNG DEMAND

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 tonnes 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 percent since 2015, to almost 40 billion cubic meters (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. 

Trafigura's head of LNG Hadi Hallouche said: "If we move away from the next one, two, three years, the industry is growing at 20 to 30 million tonnes every year but we're not taking FIDs (final investment decisions) for that kind of volume." 

"There seems to be a consensus that from two years onwards we have a (supply) crunch because we have under-invested in production," he said.

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Earlier:

2018, April, 23, 14:30:00 GLOBAL LNG IMPORTS UP 10% PLATTS - Global LNG imports in 2017 increased by nearly 10%, the highest annual growth rate since 2010, reaching 289.8 million mt, while expectations of an LNG surplus failed to materialize as rising imports into China contributed to balancing the market.

2018, February, 27, 13:45:00 GLOBAL LNG DEMAND UP TO 293 MT SHELL - The global liquefied natural gas (LNG) market has continued to defy expectations of many market observers, with demand growing by 29 million tonnes to 293 million tonnes in 2017, according to Shell’s annual LNG Outlook. Such strong growth in demand is consistent with Shell’s first LNG Outlook, published in 2017. Based on current demand projections, Shell sees potential for a supply shortage developing in mid-2020s, unless new LNG production project commitments are made soon.

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2018, January, 5, 23:35:00 LNG INVESTMENTS WILL UP BLOOMBERG - Energy companies will approve investments for more than 150 million tons a year of new supply capacity over the next four years, according to the report. By comparison, global consumption was 286 million tons in 2017. Projects in Qatar, Papua New Guinea, Russia and the U.S. are most economically appealing, followed by Mozambique, Australian expansion projects and an Alaskan mega-project.

2017, December, 22, 22:25:00 GAZPROM DEVELOPING LNG GAZPROM - With LNG demand on the rise, Gazprom is making further efforts in this line of business. Русский | English

2017, December, 11, 10:15:00 WORLD-CLASS YAMAL LNG “This is for sure a complicated project,” Putin said at a ceremony attended by the project partners and the energy minister of Saudi Arabia. “But those who started this project took a risk, and the risk was justified, and they succeeded.”

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