COURSE ON LNG

BUSINESS
Session-4
World LNG market
LNG Industry historical developments

Start of •Though first gas liquefication happened in early 20th century in USA its
commercial use for cross country trade started only in 1960.
•Hence it is only five decade old industry
business •Japan was the first major buyer of LNG and till today it is a major buyer

Growth of •Algeria was first exporter and UK first importer

•Today Qatar and Australia are dominant suppliers and Japan is dominant buyer
•Till end of 20th century, there were about 10 countries each in the business of

business imports and exports with LNG trade volume of about 100MMTPA. Today 20
countries export and 42 countries import LNG with a trade volume of 314 MMTPA

Transaction •Traditionally LNG started as a one to one business involving long term, firm
supply contracts with “Take or Pay” provisions
•In last 10 years industry has undergone dramatic change and today 32% of LNG
structure traded is on short term contracts and/or on spot basis
 Gas consumption and international trade

Pipeline v/s LNG Overall consumption pattern

Trend in LNG and pipeline supplies

WORLD LNG MARKET-2018-SUMMARY

• 406 MMTPA LIQUEFICATION CAPACITY

• 314 MMTPA TRADED (8.3% GROWTH WRT 2017)
Trade and • 99.3 MMTPA TRADRD ON SPOT and Short term (32% OF
capacity TOTAL) ( 25% in spot only and balance 7% on short term)

• 76% of global demand in Asia (Japan largest buyer & China)

• 44% OF WORLD SUPPLY FROM ASIA PACIFIC
• Two major suppliers: (a)24.5% Qatar (b)21.2% Australia
Regional
• China imports -Rapid growth: 38% in 2018;42% in 2017; 38.9%
distribution in 2016

• 20 EXPORTING COUNTRIES
• 42 IMPORTING COUNTRIES(INCLUDING 9 NEW since 2015)
• 868 MMTPA IS COMBINED CAPACITY OF IMPORT TERMINALS
Terminals • App.30 NEW IMPORT TERMINALS ADDED since 2015
 GLOBAL LNG INDUSTRY GROWTH

 Most remarkable phenomenon is the number and geographic reach of countries that have started importing LNG. Argentina,
Brazil, Canada, Chile, China, Kuwait, Mexico, and the United Arab Emirates have begun importing LNG since 2006, joining
the existing 15 importers which include Belgium, the Dominican Republic, France, Greece, India, Italy, Japan, Portugal,
Puerto Rico, the Republic of Korea (Korea), Spain, Taiwan, Turkey, the United Kingdom and the United States.
Historical trend in LNG export share of
different exporting countries
 Significant developments in 2018
US LNG available in Very rapid growth in
different regions China
Consistent 40% range
growth rate (Imports
increased by 38% in 2018,
42% in 2017 following
38.9% growth in 2016)

More than 14 million T of

LNG received (in 2018) at
terminals loaded on road
tankers
LNG projects & capacity utilisation,2017
LNG new projects development,2016
LNG SHIPS IN WORLD-2018(563 NOS. TOTAL)
AVERAGE DISTANCE OF TRANSPORT FOR LNG INCREASING
LNG Receiving terminals
Trend LNG receiving terminals built
LNG Receiving terminals and their capacity
utilisation
LNG Receiving terminals and shipsize it
can berth
 LNG Receiving terminals-
FSRU becoming a popular concept
 Trend in world LNG prices
World LNG price trend
11.5

10.5

9.5
Price in US$/mmbtu

8.5

7.5

6.5

5.5

4.5

3.5

Japan China United Kingdom Spain Brazil

LNG SUPPLIERS-MAJOR INCREMENTAL SUPPLIES
IN 2018 VIS-À-VIS 2017
LNG IMPORTERS-MAJOR INCREMENTAL PURCHASE
IN 2018 VIS-À-VIS 2017
Trend in spot and short term LNG cargoes
LNG Cargo reexports analysis
 LNG – Global Market
LNG flow direction
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