In a recent survey, Zeus Development Corporation has concluded that North America offers the most promise for global liquefied natural gas (LNG) trade growth, with over 40 proposed projects planning to export a total of approximately 400 million tpa of LNG.
"Eight percent growth on 250 million tonnes of trade, however, is a tough pace to maintain," said George Popps, LNG analyst at Zeus. "That requires the industry to double every ten years. To produce 250 million more tonnes of trade, the industry will have to build 300 million tonnes of export capacity at an investment of perhaps US$ 300 billion."
Numerous energy companies are proposing LNG export terminals to be located across the US, Canada and Mexico. Of the projects, 28 are located in the US, three of which are on the East Coast, 20 on the Gulf Coast, two on the West Coast and three in Alaska. Developers are proposing a further nine projects in Canada, while Mexico offers three more.
Integrated gas market
There is currently a debate over how many projects and what volumes of exports are in the interest of North America's integrated gas market. Although the US, Canada and Mexico are interconnected by pipelines forming the world's largest gas market under the North American Free Trade Agreement, there is no overarching government authority to manage trade to outside importers, which opens the door for competition between Canada, the US and Mexico to win project investment.
"It will be interesting to see how these three sovereignties react to plans to export LNG," Popps said. "The stage is set for investors to pit one government against another to gain the best terms. States and provinces differ in their views from federal governments as well."
Adapted from press release by Katie Woodward
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