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Global LNG trade has fifth consecutive record year as IGU releases 2019 report

Liquefied Natural Gas (LNG) trade set a record for the fifth consecutive year in 2018, reaching 316.5 million tonnes – a 9.8% increase on 2017.
Liquefied Natural Gas (LNG) trade set a record for the fifth consecutive year in 2018, reaching 316.5 million tonnes – a 9.8% increase on 2017.

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The International Gas Union (IGU) has released its 2019 World LNG Report - an annual, in-depth analysis of the current state of the Global LNG Industry over the previous 12 months.

Examining a range of metrics, the latest report illustrates that 2018 was another strong year for LNG, further reinforcing its role in expanding access to natural gas as a vital global energy source. Global LNG trade set a record for the fifth consecutive year, reaching 316.5 million tonnes (MT). This marks a significant increase of 28.2 MT, or 9.8%, from 2017 - the third-largest annual increase ever (behind only 2010 and 2017).

Over 99 MT of this number was accounted for by non-long-term trade, which equates to a 14.5 MT increase on 2017 and makes up 31% of total LNG trade. This marks the second year in a row in which the non-long-term market has substantially expanded, due to growing LNG supply and demand elasticity.

The overall growth in global LNG trade can be attributed primarily to increases in LNG supply - coming from higher production at new liquefaction plants. The single greatest increase in LNG exports occurred in Australia (+12.2 MT), owing to new trains coming on-stream and higher utilization at existing facilities. Other significant contributors to LNG supply were the United States and Russia, which added 8.2 and 7.8 MT respectively, across new and existing trains. Despite increases in these markets, the Asia-Pacific region continues to be the leading LNG-exporting region, supplying 38.4% of total exports (121.6 MT). This share is consistent with its share of global exports since 2016.

Increasing demand in 2018 also played an essential role as a key driver of growth in global LNG trade. The additions of Bangladesh and Panama as the two newest importing markets in the last year brought the total number of importing markets to 37. Asia remained the driver of international LNG demand growth, with China and South Korea returning as the key sources of LNG import demand in 2018, with growth of 15.8 and 6.4 MT respectively. Together, China and South Korea accounted for nearly 80% of the increase in net trade. Other key markets that drove global LNG growth included India and Pakistan, while European LNG imports too increased year on year for the fourth consecutive year, by 3.4 MT. This increase occurred despite net negative incremental growth in these markets through the first three quarters of the year, with the fourth quarter of the year making up for the losses, as it was the second strongest quarter ever for net imports into the region.

Between January 2018 and February 2019, an additional 36.2 MT of liquefaction capacity was added to the global nominal capacity - equating to a global total of 393 MTPA. This growth in liquefaction capacity is expected to continue, with 101.3 MTPA of capacity under construction or sanctioned, as of February 2019.

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