Branche
FS Logoi

IGU World LNG Report: Europe as leading importer

Categories: |
Topic:
Author: Theresa Graser

Date: 11. Jul. 2024

The IGU annual LNG Report is published for the 15th time this year.
Source: IGU
IGU World LNG Report for 2023

The International Gas Union (IGU) has announced the publication of its 15th annual World LNG Report. The situation on the market is tense despite lower prices.

According to the report, LNG trade grew by 2.1 % in 2023 and exceeded 401 million tons. There are 20 export markets compared to 51 import markets. The growth of the market is primarily hampered by supply.

LNG reception capacity has grown the most in Europe

LNG has established itself on the global energy market as a flexible, highly efficient and reliable resource. The current focus is on decarbonizing the LNG value chain. To this end, several projects have already been launched. They aim to use renewable energies and CO2 capture and storage, for example. At the same time, partnerships for the development of e-methane and the production of bio-LNG or liquefied biomethane are in the pipeline.

Global LNG receiving capacity has now reached 1,029.9 MTPA (million tons per annum) in a total of 47 markets at the end of February 2024. This means an increase of almost 70 MTPA in 2023 – the highest figure since 2010. Europe saw the largest increase with 30 MTPA, followed by Asia with 26.9 MTPA and Asia-Pacific with 13 MTPA. The Philippines and Vietnam joined the ranks of LNG importers for the first time.

Subdued export growth

In terms of supply, growth is clearly muted at just 0.8% year-on-year due to an increase of 3.8 MTPA at Tangguh LNG in Indonesia. Global natural gas liquefaction capacity is expected to increase to more than 700 MTPA by 2030 due to new FIDs and the commissioning of projects under construction. This is to meet demand, particularly in Asian markets where the shift from coal to gas is key to decarbonization and improving air quality.

The US leads LNG exports with 84.53 MT (compared to 75.63 in 2022). It is followed by Australia (79.56 MT), Qatar (78.22 MT) and Russia (31.36 MT).

Europe remains the second largest LNG import region

In terms of LNG spot prices, Platts JKM calculated an average price of $13.86/mmBTU (million British thermal units, equivalent to 26.4 m3 each) for 2023. The average annual price volatility has decreased significantly compared to the 2022 level, but is still above the pre-crisis level. China remains the largest importer with 71.19 million tons, followed by Japan and Korea. India follows in fourth place, as demand has responded to the low spot price. At 121.29 MT, Europe retains and consolidates its role as the second largest import region. Competition between the European and Asian markets continues to be an important market dynamic.

The increasing number of market participants, the acceleration of technological developments and the growing demand in emerging markets ensure that the LNG market continues to develop rapidly. The industry has long since ceased to be defined by large markets and companies. Portfolio companies are playing an increasingly important role. In 2023, around 180 companies were involved in LNG deliveries under term contracts, while around 35% of transactions were at spot prices.

Fragile equilibrium

However, the current balance of the market is vulnerable. The main causes of existing uncertainties include the Biden administration’s freeze on approvals for LNG projects not covered by the FTA, which could delay more than 70 MTPA of new capacity; sanctions on Russian LNG affecting almost 20 MTPA of expected capacity, and the possibility that Ukraine will not renew the Russian gas transit contract at the end of 2024. Additional factors are bottlenecks at shipyards; the ongoing security risk in the Middle East and some declining gas field supplies. Many of the liquefaction plants currently in operation are over 20 years old. Some of these plants are being decommissioned due to insufficient upstream gas production, which continues to underline the precarious supply situation.

The newest edition of Industriearmaturen & Dichtungstechnik contains an elaborate feature on LNG.

You can find the full IGU LNG Report here.

You might also be interested in:

South African valve supplier Allmech has recently added a new automatic swimming pool valve to its range of filter valves.

AUMA Profinet actuator retrofit increases plant sustainability

SAMSON: Official Go-ahead for New Electroplating Unit

Inside Industrial Valves

The industry newsletter

Your free email newsletter for the valve industry.

Publications