Global LNG demand to double by 2015

US to account for half the increase, Asia expected to contribute 20 per cent.

Global liquefied natural gas demand (LNG) is set to more than double by the middle of the next decade, buoyed by a surge in demand in the US, primarily for use in power plants, said Purvin & Gertz, a Houston-based energy consulting firm.

LNG demand may jump by 200 million tonnes a year to 2015 from 2006, with the US accounting for almost half of the increase and Asia about 20 per cent, N Ravivenkatesh, a Singapore-based consultant, said at a conference in Darwin, northern Australia.

Canadian gas exports to the US are set to decline, while gas from northern Alaska is not expected to start before 2015, Purvin & Gertz estimates. The US LNG imports may rise from about 14 million tonnes a year to more than 100 million tonnes by 2015, and the country would probably overtake Japan as the largest importer of the fuel between 2010 and 2015, it forecasts.

"It's a significant increase in LNG imports that we foresee in the US," Ravivenkatesh said at the South East Asia Australia Offshore Conference. "Moving forward, the US is going to become a dominant LNG market.''

European imports are forecast to increase to 105 million tonnes by 2015, from 47 million, with growth expected to be faster in Spain than in the more mature markets of Germany, France, Italy, the Netherlands, and the UK, Purvin & Gertz estimates.

In Asia, imports, which were about 100 million tonnes in 2006, may rise to almost 190 million tonnes in that period, it said. Most of the growth would come from newer LNG importers such as China and India, with slower demand in Japan and South Korea, Ravivenkatesh said.

Supply expansion

In terms of LNG supply, most of the growth through 2010 would be in the East of Suez regions of Asia and the Middle East, with a "significant'' rise after that date from the west of Suez region, Ravivenkatesh said. Qatar would dominate the Middle Eastern supply growth, with a jump of 40 million tonnes in production from 2007 to 2010, he said. Australia should account for 65 per ent of the supply expansion in Asia through 2015, while production in Nigeria is set to surge in 2010-2015, he said.

Woodside Petroleum, Chevron Corporation and Inpex Holdings are among the companies planning to build LNG supply projects in Western Australia.

LNG is natural gas chilled to liquid form, reducing it to one-six-hundredth of its original volume, for transportation by tanker to destinations not connected by a pipeline. On arrival it is converted back into gaseous form for delivery to users such as power plants, factories and households.