According to a new report by the International Energy Agency, the position of global supremacy presently claimed by Australia and Qatar as the world’s largest exporter of natural gas is most likely to be challenged by the United States soon enough.
With the total global consumption of natural gas on track to hit almost 4,000 billion cubic meters by 2022, there are expectations that there would be a growth of 1.6 percent a year for the next five years in the global demand for gas. And the largest demand is expected to be placed by China which will account for almost 40 percent of growth, according to estimates of the IEA.
“The U.S. shale revolution shows no sign of running out of steam and its effects are now amplified by a second revolution of rising LNG supplies,” IEA Executive Director Fatih Birol said in a statement Thursday.
“Also, the rising number of LNG consuming countries, from 15 in 2005 to 39 this year, shows that LNG attracts many new customers, especially in the emerging world,” Birol added.
At present, the U.S. is already the world’s largest producer of natural gas. And accounting for more than a fifth of global gas output, the country’s production will be 890 bcm by 2022, the IEA estimated.
And with more than half of the natural gas produced kin the U.S. being expected to be converted to liquefied natural gas for export, the United States will challenge Qatar and Australia as the highest exporter by 2022, the IEA said.
The number of U.S. ports currently in use would be doubled as, in a bid to increase export demand, three major LNG terminals under construction on the Texan coast do so.
The IEA also predicts that the future demand for the products would be driven by industry.
As the industrial use of natural gas in power generation is trimmed by a growing mix of renewables and coal, future demand will be driven by the industrial sector, according to the IEA.
A glut is driving down prices to interest new countries such as Pakistan, Thailand and Jordan and increased liquification capacity is coming into a market already well supplied, the report added.
The current diplomatic standoff involving Qatar and Saudi Arabia was highlighted ion the report which also warned that disruption to traditional routes of energy supply was a likely outcome of cheaper, export LNG.
“Even in a well-supplied market, recent events remind us that gas security remains a critical issue,” Birol said
(Adapted from CNBC)