According to Andy Flower, Global imports for the first half of 2007 were up 8.5%, including a 10% rise in the second quarter. An additional 7.5 MMT was produced in the period compared with the second half of 2006. Qatar is showing a rise in exports of 19%, Australia 18%, Nigeria nearly 35%, Oman 15%, and Malaysia close to 12%. Egypt showed a 3.5% decline and Trinidad a rise of only 5.5%. Global LNG imports totaled around 86.4 MMT in the first half.

According to EIA short-term energy outlook, EIA expects LNG imports to the US to fall thanks to tougher competition from other markets. EIA is forecasting a decline in the LNG imports as more cargoes are expected to be directed to European and Asian markets. Imports of LNG for the first half of 2007 totaled 460 BCF, about 53% more than the same period in 2006. Total LNG imports in 2007 are still expected to reach 850 BCF, which would be a record high.

World LNG trade reached 85.8 MMT in the first half of 2007. It shows a 8% increase in compare to the same period in 2006. (See Graphs).

EIA said in its short-term energy outlook released in Oct. 2007, US imports of LNG are expected to increase from 2006 levels by about 260 BCF or 44.5% in 2007 and by about 170 BCF or 19.7% in the next year. High natural gas prices in the United States compared with other LNG consuming countries, combined with increased global supply of LNG, created a surge in shipments to the United States during the first half of 2007 but the deliveries of LNG to the country have slowed in the past two months due to increased LNG demand in Japan’s power generation sector following the shutdown of the Kashiwazaki Kariwa nuclear power plant due to the earthquake in July, EIA reported.The Henry Hub spot price is expected to average about $7.30/MMCF in 2007 and slightly more than $8/MMCF in 2008, EIA had anticipated in September 2007.

More than 17 MMT/Y of new LNG production capacity was scheduled to be started up in 2007. EG LNG with 3.4 MMT/Y and Snohvit LNG with 4.2 MMT/Y came on stream in the year although the later shut down because of a cracked heat exchanger at the plant. The NLNG's train 6 with 4 MMT/Y capacity was scheduled to be started up in 2007 but it has been delayed until early next year.

More than 30 MMT/Y of new LNG regasification capacity was scheduled to be started up in 2007. Reganosa terminal in Spain with 2.9 MMT/Y capacity came on stream. It was scheduled that Dragon and South Hook terminals in UK with totally 11.9 MMT/Y capacity and Fos Cavaou terminal in France with 6 MMT/Y capacity be commissioned in 2007 but all three terminals have been delayed until early next year.

There has been no ground breaking of a new LNG terminal in the US in 2007 and if we consider that Notice to Proceed (FID) to in-service for a terminal take 48 months it would not be completed until 2012 at earliest. 

According to Waterborne Energy report (Jan. 2008):

• Asian LNG imports in 2007, increased by 10 MMT to a record 112.74 MMT, 10% higher than 2006. Qatar was the largest LNG supplier to Asia.

• LNG spot prices in Japan and South Korea recently touched $21/MMBTU, more than double the levels in the US and UK. It is expected that Asian demand for spot LNG cargoes to remain strong throughout winter. Atlantic LNG was a leading source of spot global LNG cargoes.

• The US imported a record amount of LNG in 2007, up more than 30% from the last year at about 16.25 MMT/Y. (EIA had anticipated the country's LNG imports to hit another record above 18.75 MMT in 2007).

Several LNG projects were scheduled to take a Final Investment Decision (FID) in 2007, but only two did: Pluto and Angola LNG. These two projects had one distinct advantage over the others: a strong alignment in the strategy of the project's partners which is a key project driver, PFC Energy said. "A company with no alternative for growth other than one specific project is likelier to overcome obstacles in pushing forward -- this was the LNG lesson for 2007."

In 2007, Oman, Egypt, Algeria, Nigeria, Indonesia and Trinidad failed to run its LNG plants at full capacity due to lack of feed-gas.

On 14 Mar. 2008, Eurogas reported that EU 27 gas consumption falls by 1.5% on year in 2007 to 505 BCM. Most of the main gas-using countries saw gas use decrease, except the UK, Spain and Italy, where gas use increased in 2007. Eurogas said the most important factor behind the decrease was the weather, with the start of the year having been mild in 2007. High energy prices and increased efficiency were also factors. EU 27 gas production fell by 7% to 198 BCM in 2007. The decrease was mainly made up by increased imports from Norway. The UK saw production fall 9.9%, Germany 8.3%, Denmark 11.4% and Italy 11.5%. The EU got 38% of its 2007 supplies from indigenous production. The main external sources of supply are Russia with 23%, Norway with 18% and Algeria 10%.

According to Cedigaz (provisional estimates, published in May 2008):

• World consumption of natural gas increased by 2.5% in 2007 to about 2.95 TCM, Gas demand grew 6.8% in Asia-Pacific, 4.3% in North America and 3.1% in Europe.

• World LNG trade rising by 7.3% to 226.4 BCM (165.3 MMT) in 2007. In the year, Asian LNG demand increased 9.5% to 148 BCM, driven by a substantial growth in imports by Japan, India and China. European LNG imports decreased by 7.1% to 53 BCM, reversing the trends of the two previous years when Europe recorded the fastest growth rates in LNG demand. North American LNG imports increased 36% to 25.1 BCM declines in the past two years. LNG's share of the world gas trading rose to 25% from 23.7% the previous year.

• World gas trade including pipeline supplies increased 2% to 905 BCM, making up 31% of the world's marketed gas production. Global natural gas trade by pipeline grew a modest 0.4% to 679 BCM in 2007. LNG trade accounted for the most of the growing global trade. LNG supplies represented 7.7% of worldwide gas supply in 2007, compared to 7.3% in the previous year.

• Europe's share of cross-border trade fell two percentage points to 47%, while the Asian and North American portions each climbed by one point to 18% and 17%, respectively.

According to the IHS-CERA's Upstream Capital Costs Index (UCCI), announced in May 2008 :

Constructing upstream oil and gas facilities cost has increased by 6% over the past 6 months and has doubled since 2005. "Rising costs have become one of the 'new fundamentals' driving the price of oil," said Daniel Yergin, chairman of CERA. These have been driven by the increased demand for raw materials and transportation. These costs are a serious concern and a major challenge for oil and gas companies and are contributing to the delays and postponements of many projects. Exchange rate fluctuations and the weakening US dollar also contribute. With the dollar the reporting currency of choice, this has a dramatic effect on final construction costs for projects in some regions such as Europe and West Africa.

According to International Group of LNG Importers (IGLNGI), announced in May 2008:

Spot and short-term LNG trading (the contracts with less than 4-year duration) soared by over 34% in 2007 to 33.6 MMT, equal to nearly 20% of international LNG trading, compared with 16% in 2006. The rate of this growth is 12 times higher than that of other kinds of LNG trading, which rose by 2.8% (to 137.2 MMT). 586 LNG cargoes were traded as spot, swap, reselling or diverted to other destinations or deliveries within the framework of short-term contracts last year, compared with 436 in 2006.

International LNG trading rose by 7.6% in 2007 to 170.8 MMT, a very high rate compared with the oil imports and exports that have increased by around 2 to 3%/Y. 68 new port-to-port and 15 new country-to-country  LNG routes emerged in 2007.

According to BP Annual Statistical Review published in June 2008:

• Global natural gas production rose 2.4% to 2,940 BCM in 2007.

• Production growth was led by North America—the US contributed one-third of the global volume growth in 2007. Production growth in the US, up 4.3% to 545.9 BCM, was the biggest growth since 1984.

• EU gas production declined 6.4%, with UK output falling 9.5%, the world’s largest decline in volume for a second consecutive year.

• Russia produced 612 BCM in 2007, down 1% on the year earlier.

• China and Qatar recorded the second and third-largest increments in production, 18.4% and 17.9%, respectively.

• LNG shipments rose 7.3% last year, in line with the historical average, boosted by continued growth in shipments from Qatar and Nigeria, the report said.

• The US accounted for nearly half of the world’s gas consumption growth, driven by cold winter weather and strong demand for gas in power generation. World gas reserves were 177.4 TCM at the end of 2007, an increase of 1.14 TCM from the previous year. 

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