US on track to be world's number two

Overall, global LNG export capacity would reach 650 billion m³ a year by the end of 2022, compared to less than 452 billion m³ a year in 2016.

Of that amount, Australia would have capacity to export 117.8 billion m³ a year of LNG, followed by the US with 106.7 billion m³ a year and Qatar with 104.9 billion m³ a year.

Australia would stay top by adding 30 billion m³ a year of capacity by the end of 2022 to its existing capacity, but the US, which has seen shale gas output surge, would add approximately 90 billion m³ a year to its capacity of around 14 billion m³ a year now.

However, the new LNG capacity is being added to an already well-supplied market, while demand is falling in some of the traditionally large importing nations, such as Japan.

With demand expected to reach 460 billion m³ a year by 2022, the market would have 190 billion m³ a year in excess capacity, putting pressure on gas prices and discouraging new upstream investment.

Current low LNG prices are already making it tougher for exporters, and competition is loosening the typically rigid contracts that have dominated the long-distance trade.

The IEA report did not assess the impact of Qatar's increased output plans as the extra capacity was expected to be in place after the report's forecast period of 2016 – 2022.

Overall, the IEA said global gas production would grow faster than oil and coal in the next five years, helped by low price and ample supply, alongside a growing preference for gas because of its lower emissions compared to other fossil fuels.

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