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Global LNG imports fuelled by Asian demand

LNG Industry,

Global LNG imports are being fuelled by escalating demand from emerging Asian nations, according to a report from Frost & Sullivan.


The shale gas revolution in North America has altered market dynamics as the region will no longer be dependent on LNG imports. The US is, in fact, poised to emerge as a major LNG supplier in the international market. Similarly, LNG capacity additions in Australia are anticipated to make the country a key supplier by 2017.


Demand, on the other hand, will rise in the Asia Pacific, which is seeing strong economic standing. Japan, in particular, is likely to depend on imports to meet all its LNG needs, while China and India will also prove significant end-user markets. This region expects to become a supplier hub, as several long-term LNG supply contracts in the Asia Pacific are nearing completion.

LNG pricing

Frost & Sullivan Energy & Environmental Research Analyst, Rasholeen Nakra, explained: "Technological advancement to extract shale gas has gone a long way in narrowing the LNG demand-supply gap. Furthermore, due to the surplus gas, there will be considerable revisions in the LNG price structure. It is likely to become a buyers' market, meaning, the consumers will hold the bargaining power."

New capacity

Despite the availability of gas, participants are challenged to reach the market. For example, gas producers in the US have been hindered by delays in getting LNG export permits. At the same time, new infrastructure capacity in Australia has increased the costs of LNG.

Price negotiations?

"To address the voluminous demand from Asia and other regions, countries with surplus gas such as the US and Australia need to work with their respective governments to be open to LNG price negotiations," Nakra added.

Funding and policies

Increased funding to make LNG trade possible will result in new investments to build liquefaction and regasification facilities. In addition, several countries are undergoing regulatory policy revision to relax LNG trade.

Adapted from press release by Katie Woodward

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