In some ways, nothing has changed in the liquefied natural gas market. Proponents still expect unparalleled global demand and a significant supply gap over the next 10 to 15 years to necessitate a second, larger wave of LNG facilities and a swift ramp-up in production, according to 10/12 Industry Report.
Nonetheless, it would be disingenuous to say the road to the next wave didn’t get a little bumpy in 2018. A destabilized political climate, increased competition and a changing price structure prompted many LNG owners to delay projects or postpone investment decisions.
In the first quarter edition of 10/12 Industry Report, Eric Smith, interim director of the Tulane Energy Institute in New Orleans, says the trade war between the U.S. and China undoubtedly had an impact. China is the biggest consumer of natural gas in the world, and its countervailing duties on LNG, in retaliation for U.S. duties on steel and aluminum, proved detrimental.
That hurt the industry in two ways: in the cost of construction and the marketability of the product.
However, short-term variables aside, Industrial Info Resources says long-term demand for LNG remains, and predicts it will reach 141 million tons a year by 2030. Natural gas production is ramping up ahead of the demand and is projected to increase 25% through 2020. Read the full in-depth story in LNG.