LNG: Gas Demand Drives Investment
A bright future is forecast for the LNG industry, as long-term gas demand drives major investment in global LNG facilities. A new report from energy business advisors, Douglas-Westwood (DW), predicts the Pacific basin will be the main contributor to a ten year global investment high of $26 billion per annum by 2015. The report is being launched this week at the 6th FLNG Asia Pacific Summit, Singapore and the 5th Annual Gas Storage Conference, London, with presentations by Jason Waldie and Joseph Dutton.
“Last year saw recovery in LNG demand, led by Asian consumers. China, in particular, has seen its LNG demand grow from 1 bcm in 2006 to around 13 bcm today. LNG imports to Western European and Latin American countries have also increased. In addition, we have the prospect of increased demand for natural gas as the world considers the future of nuclear energy in the aftermath of the Japanese crisis,” said report lead author, Lucy Miller.
“On the supply side, 2010 saw the commencement of major construction work on new facilities in Australia and Papua New Guinea. Despite lower levels of expenditure on new LNG facilities, resulting from projects being delayed by the recession, the market is expected to recover and Capex on LNG facilities for the 2011-2015 period is forecast to total over $93 billion,” concludes Miller.
This is just one of many key expenditure forecasts revealed in DW’s, World LNG Market Report 2011-2015, which was launched today. The report suggests that much of the sector’s growth will be driven by an abundance of promising liquefaction projects in Australasia and import facilities in Asia.
The market model used to develop the forecasts is based on a project-by-project review of development prospects, with the timing of expenditure phased to reflect likely project structure. The 200 page report includes 130 charts and 70 tables showing historic and forecast expenditures in US dollar values from 2006 to 2015, segmented by facility type and region. Expenditure related to LNG liquefaction and regasification terminals is further broken down by individual components – including jetty and loading arms, storage tanks, compressors and construction services.