Global LNG Info “Where the World Tracks the LNG Developments”
| Home | Introduction | Global LNG Database | Special Reports | LNG Times Newsletter | Booking | Contact us |
Advertisement:
Global LNG Developments:
Further & Fundamental Developments Global LNG Developments in 2010
Global LNG Developments in 2009 Global LNG Developments in 2008 Global LNG Developments in 2007 Global LNG Developments in 2006
News and Trends:
ýOn 1 Oct. 2009, ExxonMobil CEO, Rex Tillerson, said that meeting the world’s growing energy needs while managing the risks of climate change will require the development of all viable sources of energy and policies that support business investment and technology development. “Our best hope is to harness the power of new technologies and free markets to meet the world’s energy and environmental challenges,” the Super-major CEO said. “By allowing nations and peoples to work together, we can invest in integrated solutions that expand energy supplies, increase efficiency and reduce emissions. Time and time again, our industry has proven that innovation and cooperation unleash human ingenuity and bring far-reaching technological advances that can transform the economy, protect the environment, and increase energy security.” Tillerson outlined the energy challenge facing America and the world – ensuring the availability of energy supplies required for economic growth while addressing the risks of climate change. He highlighted the advantages of a revenue-neutral carbon tax as an effective policy option, compared to the shortcomings of cap-and-trade systems, which can increase price volatility and cause economic harm while failing to reduce carbon emissions.On 6 Oct. 2009, EIA reported that the US gas inventories are expected to reach a record peak of 3.85 TCF when storage injections end on 31 Oct. about 3.59 TCF was in storage on 25 Sept, 481 BCF above the average level of 2004-2008 period. EIA said that household heating with gas can expect to spend 12% less this winter. The decline represents an 11% decrease in prices and a 1% decrease in consumption. The Henry Hub spot gas price averaged $3.06/MMBTU in September, 17¢/MMBTU below August’s average. EIA expects prices to remain low through October, and then begin to increase as space heating demand picks up this winter and economic conditions improve. Prices are expected to increase in 2010 but, even with a projected winter storage withdrawal greater than the 5-year average, end-of-March inventories still will be the highest recorded since March of 1991, EIA said. EIA forecasted that total US marketed gas production will increase by 1.5% in 2009 and decrease by 3.8% in 2010, with marketed production during the first half of 2010 to average 1.8 BCF/D lower than the second half of 2009,” it said. “However, economic recovery and increasing demand next year are expected to push prices up and provide the incentive for increasing production later next year.” EIA expected increases in US LNG imports to about 471 BCF in 2009 and 660 BCF in 2010 from 352 BCF in 2008.On 6 Oct. 2009, Repsol CEO, Antonio Brufau warned that global LNG markets would likely be in surplus until 2013 which could prompt state energy companies to deliberately restrict supplies to prop up prices. "The NOCs owning gas resources may decide to operate plants at below their potential top capacity, thereby regulating supply increases," Brufau said. Thereafter demand will exceed supply unless new LNG projects that are currently awaiting the final investment decision are approved. However, he predicted that LNG taking a greater share of the global energy market. LNG would grow market share at the expense of other fuels like coal and gas exported by pipeline due to environmental concerns and demands for more flexible supplies, Brufau said.On 6 Oct. 2009, Qatargas CEO, Faisal Al-Suwaidi said the postponement of planned LNG production plant amid the current global slump in natural gas prices will lead to tight supplies by 2015. The consuming nations needed to prepare themselves for the coming tight supply situation and the global gas industry has to avoid past errors and keep investing in new capacity to meet long term demand, Al-Suwaidi said. Demand for gas would continue to grow as countries diversify energy supplies and add LNG to the mix as a way to safeguard against supply disruptions from gas delivered over pipelines. Suwaidi expects demand to continue to rise in China and India, helping compensate for decreasing or stable demand in other countries. He said that de-bottlenecking of the operating Qatargas’ LNG production trains could produce extra output totaling 12 MMT/Y by 2014 when a moratorium on new projects is lifted.On 8 Oct. 2009, BP CEO, Tony Hayward, said that identifying and securing the role of gas in the world’s energy mix out to 2030 is industry’s challenge. Alternative energies will play a role but exactly what remains to be defined. Wind and solar supply to power generation is intermittent and can play a role in supply, but gas—especially now—is dependable. Reserves estimates are rising sharply. “We must increase gas use,” said Hayward. It has the greatest potential at the lowest cost all with technologies available today. We also must take the carbon out of energy supply today and “be realistic” about how much that process costs.In Nov. 2009, the International Energy Agency (IEA) reported that global gas demand looks set to fall this year and the market is likely to remain oversupplied until 2015, despite a rise in demand when the economy begins to recover. Demand for gas for industry and power generation could fall sharply this year, particularly in Europe, leading to a possible 3 percent drop in global demand.Gas consumption could bounce back globally from next year, if the global economy recovers, rising by an average of 2.5 percent a year from 2010 to 2015 driven by increased gas burning for electricity generation, According to the IEA’s 2009 world energy outlook (WEO-2009) published in November 2009. However, gas supply is still likely to swamp demand until the latter part of the next decade, keeping prices low and threatening investment in new production facilities that will be needed later. Much of the oversupply would be a result of the US losing its appetite for imported gas. Gas exporting nations ramped up their investment in LNG industry on the belief that the US would need substantially more supply in the coming years. But the development of unconventional or shale natural gas in the U.S. has changed that outlook, IEA said.The recent rapid development of unconventional gas resources – notably shale gas – in North America has transformed the gas-market outlook. “Unconventional gas is unquestionably a game-changer in North America with potentially significant implications for the rest of the world,” IEA said. The share of unconventional gas in total US gas output jumped from 44% in 2005 to around 50% in 2008 and, in the Reference Scenario, is projected to rise to almost 60% in 2030. The boom in North American unconventional gas production, together with the recession’s impact on demand, is expected to prolong the glut of gas supply for the next few years.According to the WEO-2009, natural gas is set to continue to play a bridging role in meeting the world’s sustainable energy needs. In the Reference Scenario, gas demand rises by 41% from 3 TCM in 2007 to 4.3 TCM in 2030.The analysis of WEO-2009 shows that the annual under-utilization of inter-regional pipeline and LNG capacity could rise from around 60 BCM in 2007 to 200 BCM by 2015. This glut could have far-reaching consequences for the structure of gas markets, with suppliers to Europe and Asia-Pacific coming under pressure to modify pricing terms under long-term contracts, to de-link gas prices from oil prices, sells more gas on a spot basis and to cut prices to stimulate demand.Proven world gas reserves at the end of 2008 are estimated to be more than 180 TCM, equal to about 60-year production at current rates, with over half located in just three countries: Russia, Iran and Qatar. An analysis of the 600 largest gas producing fields, which account for 55% of global output, indicates that "close to half of the world's existing production capacity will need to be replaced by 2030 as a result of depletion -- the equivalent of twice current Russian production," according to the WEO-2009. EIA said energy prices going up in 2010:Natural gas prices are expected to rise through 2011, the US EIA said in its short-term energy outlook on 12-Jan as a steady economic recovery in the US is expected to fuel a rise in demand in 2010 and 2011.Due to the expected declines in gas production and imports this year, the US EIA increased its first-quarter Henry Hub spot price forecast by 21%, to $5.56/MCF. EIA predicted a full-year 2010 average price of $5.36/MCF up 16%, from its previous outlook report published in December and $1.30/MCF higher than the 2009 average of $4.06/MCF. The agency said it expects gas prices to continue rising in 2011, averaging $6.12/MCF.US gas production rose 3.7% in 2009 despite a 59% downturn in the working gas rig count from September 2008 to July 2009, EIA said. It attributed the modest growth to the enhanced productivity of new wells in unconventional plays—but it predicted steep declines from initial levels at those same wells, which should contribute to a 3% drop in overall 2010 production.Gas consumption is predicted to be almost unchanged this year, the US EIA said. “Higher natural gas prices in 2010 are expected to cause a 2.8% decline in gas consumption in the electric power sector in 2010, which will offset growth in the residential, commercial and industrial sectors,” The US EIA added. The weak economy cut gas use by 1.5% in 2009, however, the agency predicts that gas demand will remain nearly steady through 2011, when it is expected to rise just 0.4%.
ýOn 1 Oct. 2009, ExxonMobil CEO, Rex Tillerson, said that meeting the world’s growing energy needs while managing the risks of climate change will require the development of all viable sources of energy and policies that support business investment and technology development. “Our best hope is to harness the power of new technologies and free markets to meet the world’s energy and environmental challenges,” the Super-major CEO said. “By allowing nations and peoples to work together, we can invest in integrated solutions that expand energy supplies, increase efficiency and reduce emissions. Time and time again, our industry has proven that innovation and cooperation unleash human ingenuity and bring far-reaching technological advances that can transform the economy, protect the environment, and increase energy security.” Tillerson outlined the energy challenge facing America and the world – ensuring the availability of energy supplies required for economic growth while addressing the risks of climate change. He highlighted the advantages of a revenue-neutral carbon tax as an effective policy option, compared to the shortcomings of cap-and-trade systems, which can increase price volatility and cause economic harm while failing to reduce carbon emissions.
On 6 Oct. 2009, EIA reported that the US gas inventories are expected to reach a record peak of 3.85 TCF when storage injections end on 31 Oct. about 3.59 TCF was in storage on 25 Sept, 481 BCF above the average level of 2004-2008 period. EIA said that household heating with gas can expect to spend 12% less this winter. The decline represents an 11% decrease in prices and a 1% decrease in consumption. The Henry Hub spot gas price averaged $3.06/MMBTU in September, 17¢/MMBTU below August’s average. EIA expects prices to remain low through October, and then begin to increase as space heating demand picks up this winter and economic conditions improve. Prices are expected to increase in 2010 but, even with a projected winter storage withdrawal greater than the 5-year average, end-of-March inventories still will be the highest recorded since March of 1991, EIA said. EIA forecasted that total US marketed gas production will increase by 1.5% in 2009 and decrease by 3.8% in 2010, with marketed production during the first half of 2010 to average 1.8 BCF/D lower than the second half of 2009,” it said. “However, economic recovery and increasing demand next year are expected to push prices up and provide the incentive for increasing production later next year.” EIA expected increases in US LNG imports to about 471 BCF in 2009 and 660 BCF in 2010 from 352 BCF in 2008.
On 6 Oct. 2009, Repsol CEO, Antonio Brufau warned that global LNG markets would likely be in surplus until 2013 which could prompt state energy companies to deliberately restrict supplies to prop up prices. "The NOCs owning gas resources may decide to operate plants at below their potential top capacity, thereby regulating supply increases," Brufau said. Thereafter demand will exceed supply unless new LNG projects that are currently awaiting the final investment decision are approved. However, he predicted that LNG taking a greater share of the global energy market. LNG would grow market share at the expense of other fuels like coal and gas exported by pipeline due to environmental concerns and demands for more flexible supplies, Brufau said.
On 6 Oct. 2009, Qatargas CEO, Faisal Al-Suwaidi said the postponement of planned LNG production plant amid the current global slump in natural gas prices will lead to tight supplies by 2015. The consuming nations needed to prepare themselves for the coming tight supply situation and the global gas industry has to avoid past errors and keep investing in new capacity to meet long term demand, Al-Suwaidi said. Demand for gas would continue to grow as countries diversify energy supplies and add LNG to the mix as a way to safeguard against supply disruptions from gas delivered over pipelines. Suwaidi expects demand to continue to rise in China and India, helping compensate for decreasing or stable demand in other countries. He said that de-bottlenecking of the operating Qatargas’ LNG production trains could produce extra output totaling 12 MMT/Y by 2014 when a moratorium on new projects is lifted.
On 8 Oct. 2009, BP CEO, Tony Hayward, said that identifying and securing the role of gas in the world’s energy mix out to 2030 is industry’s challenge. Alternative energies will play a role but exactly what remains to be defined. Wind and solar supply to power generation is intermittent and can play a role in supply, but gas—especially now—is dependable. Reserves estimates are rising sharply. “We must increase gas use,” said Hayward. It has the greatest potential at the lowest cost all with technologies available today. We also must take the carbon out of energy supply today and “be realistic” about how much that process costs.
In Nov. 2009, the International Energy Agency (IEA) reported that global gas demand looks set to fall this year and the market is likely to remain oversupplied until 2015, despite a rise in demand when the economy begins to recover. Demand for gas for industry and power generation could fall sharply this year, particularly in Europe, leading to a possible 3 percent drop in global demand.
Gas consumption could bounce back globally from next year, if the global economy recovers, rising by an average of 2.5 percent a year from 2010 to 2015 driven by increased gas burning for electricity generation, According to the IEA’s 2009 world energy outlook (WEO-2009) published in November 2009. However, gas supply is still likely to swamp demand until the latter part of the next decade, keeping prices low and threatening investment in new production facilities that will be needed later. Much of the oversupply would be a result of the US losing its appetite for imported gas. Gas exporting nations ramped up their investment in LNG industry on the belief that the US would need substantially more supply in the coming years. But the development of unconventional or shale natural gas in the U.S. has changed that outlook, IEA said.
The recent rapid development of unconventional gas resources – notably shale gas – in North America has transformed the gas-market outlook. “Unconventional gas is unquestionably a game-changer in North America with potentially significant implications for the rest of the world,” IEA said. The share of unconventional gas in total US gas output jumped from 44% in 2005 to around 50% in 2008 and, in the Reference Scenario, is projected to rise to almost 60% in 2030. The boom in North American unconventional gas production, together with the recession’s impact on demand, is expected to prolong the glut of gas supply for the next few years.
According to the WEO-2009, natural gas is set to continue to play a bridging role in meeting the world’s sustainable energy needs. In the Reference Scenario, gas demand rises by 41% from 3 TCM in 2007 to 4.3 TCM in 2030.
The analysis of WEO-2009 shows that the annual under-utilization of inter-regional pipeline and LNG capacity could rise from around 60 BCM in 2007 to 200 BCM by 2015. This glut could have far-reaching consequences for the structure of gas markets, with suppliers to Europe and Asia-Pacific coming under pressure to modify pricing terms under long-term contracts, to de-link gas prices from oil prices, sells more gas on a spot basis and to cut prices to stimulate demand.
Proven world gas reserves at the end of 2008 are estimated to be more than 180 TCM, equal to about 60-year production at current rates, with over half located in just three countries: Russia, Iran and Qatar. An analysis of the 600 largest gas producing fields, which account for 55% of global output, indicates that "close to half of the world's existing production capacity will need to be replaced by 2030 as a result of depletion -- the equivalent of twice current Russian production," according to the WEO-2009.
EIA said energy prices going up in 2010:
Natural gas prices are expected to rise through 2011, the US EIA said in its short-term energy outlook on 12-Jan as a steady economic recovery in the US is expected to fuel a rise in demand in 2010 and 2011.
Due to the expected declines in gas production and imports this year, the US EIA increased its first-quarter Henry Hub spot price forecast by 21%, to $5.56/MCF. EIA predicted a full-year 2010 average price of $5.36/MCF up 16%, from its previous outlook report published in December and $1.30/MCF higher than the 2009 average of $4.06/MCF. The agency said it expects gas prices to continue rising in 2011, averaging $6.12/MCF.
US gas production rose 3.7% in 2009 despite a 59% downturn in the working gas rig count from September 2008 to July 2009, EIA said. It attributed the modest growth to the enhanced productivity of new wells in unconventional plays—but it predicted steep declines from initial levels at those same wells, which should contribute to a 3% drop in overall 2010 production.
Gas consumption is predicted to be almost unchanged this year, the US EIA said. “Higher natural gas prices in 2010 are expected to cause a 2.8% decline in gas consumption in the electric power sector in 2010, which will offset growth in the residential, commercial and industrial sectors,” The US EIA added. The weak economy cut gas use by 1.5% in 2009, however, the agency predicts that gas demand will remain nearly steady through 2011, when it is expected to rise just 0.4%.
Announcements