US to be world's No.2 LNG exporter by end-2022

The United States is on track to have capacity to become the world's second largest exporter of liquefied natural gas (LNG) by the end of 2022, just behind Australia, the International Energy Agency (IEA) said.

Overall, global LNG export capacity would reach 650 billion cubic metres (bcm) a year by the end of 2022, compared to less than 452 bcm a year in 2016, the IEA said in its annual report on gas markets. Of that amount, Australia would have capacity to export 117.8 bcm a year of LNG, followed by the United States with 106.7 bcm, it said.

Australia would stay top by adding 30 bcm a year of capacity by the end of 2022 to its existing capacity, but the United States, which has seen shale gas output surge, would add about 90 bcm a year to its capacity of about 14 bcm a year now. "By the end of our forecast period, the United States will be well on course to challenging Australia and Qatar for global leadership among LNG exporters," the report said.

However, the new LNG capacity is being added to an already well-supplied market, while demand is falling in some of the traditionally large importing nations, such as Japan, it said. With demand expected to reach 460 bcm a year by 2022, the market would have 190 bcm a year in excess capacity, putting pressure on gas prices and discouraging new upstream investment.

Current low LNG prices are already making it tougher for exporters, and competition is loosening the typically rigid contracts that have dominated the long-distance trade.

Source: Khaleej Times