Blog: World outlook for LNG: More!

What can we look for in the world use of LNG in 2025, and farther down the years?

In 2023, the latest year for which we have full-year figures, global trade in LNG reached 404 million tonnes, up by 1.7% from 397 million tonnes in 2022.

Some current estimates:

  • For this year, the International Energy Agency says global gas demand could reach 4,293 billion cubic metres, nearly 30% more than in 2024.
  • The U.S. Energy Information Administration: “We expect LNG exports to increase by 15% in 2025, reaching almost 14 Bcf/d (14 billion cubic feet a day) as export capacity expands.”
  • European demand for LNG could hit a record as the EU looks for new sources or natural gas other than Russia.

And down the road:

  • Shell: Global demand for LNG is estimated to rise by more than 50% by 2040, as industrial coal-to-gas switching gathers pace in China and South Asian and South-east Asian countries use more LNG to support their economic growth. https://ow.ly/YiAo50UzXoB
  • The Gunvor Group also sees LNG demand growing by 50% by 2040.
  • The Gas Exporting Countries Forum expects LNG demand to rise some 54% by 2050, with Asia Pacific and Europe collectively accounting for 89% of all LNG imports.
  • TC Energy expects LNG exports to triple by 2035, led by a doubling of exports from the US and supported by Canada’s new export volumes.
  • And India’s LNG imports will rise 4%-10%.

The International Energy Agency, though, proposes that a glut of LNG supply will occur over the next two years, affecting prices, and will last into the 2030s. We shall see,

Twenty countries now export LNG, and 51 import it.

And, starting in a few months, the LNG Canada project at Kitimat BC will start shipping LNG to overseas customers.

“This is pretty groundbreaking,” says Phil Hodge, CEO of junior gas producer Pine Cliff Energy. “We’ve never, ever, had a customer for our natural gas other than the United States. Over 10 per cent of all of our production will instantly be exported to the biggest markets in the world, which are (in) Asia.”

As climate issues continue to press, LNG buyers are increasingly expected to look for “cleaner” LNG, produced with ever lower carbon emissions. And Canada offers LNG with the world’s lowest emissions-intensity.

LNG from Canada can reduce emissions by up to 62 per cent, according to a study published in the Journal for Cleaner Production.

BC is an important leader in this: LNG Canada will have an emissions intensity of 0.15 per cent CO2 per tonne, less than half the global average of 0.35 per cent per tonne, according to the Oxford Energy Institute.

Woodfibre LNG would have emissions intensity of 0.04 per cent, less than one sixth of the world average. Cedar LNG would have emissions intensity of 0.08 per cent, less than one third of that global average. And Ksi Lisims LNG will have net-zero emissions within three years of its first shipment overseas.

BC LNG benefits from a colder climate (which assists the production process), from the use of hydroelectricity for production, and from methane emissions reduction from upstream natural gas production.

As well, the natural gas that becomes BC LNG is produced and transported under tighter regulatory conditions than in the US.

BC also benefits from shorter shipping distances to Asian customers. It can take 25 to 30 days to move LNG from the U.S. Gulf to Asia via the Panama Canal, compared with just 10 days from B.C.

That means fewer emissions from the LNG carriers — and we don’t have to pay Panama Canal fees which now are running at as much as US $731,800 for the transit of a single loaded LNG carrier.

Photo: LNG carrier at terminal

(Posted here 08 January 2025)

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