SINGAPORE -- The global trade in liquefied natural
gas likely shrank last year due to lower overall gas
output, and gas producers will focus on meeting a supply
shortfall for the next couple of years, a senior BG Group
executive said Thursday.
Preliminary data show the volume of LNG changing hands
declined for the first time in the industry's history by 2.5
million metric tons in 2012, compared with a 19-million-ton
jump a year earlier, Steve Hill, vice president of global LNG
and oil marketing at BG Group, said at the LNG Supplies for
Asian Markets conference in Singapore.
BG Group is one of the world's largest suppliers of LNG.
According to its 2012 data book, it had contracted LNG supply
of around 13 million tpy.
He said higher gas output from some producers was offset by
production problems at other companies in Indonesia, Algeria,
Malaysia, Egypt and Yemen.
Analysts estimate the global LNG trade will grow from its
current size of 240 million tons to around 450 million tons by
currently accounts for 10% of global natural
gas consumption, with a total of 18 exporting and 26
importing countries, and around 365 ships for
However, global LNG
supply is currently limited as no new projects have started production and
supply is expected to remain tight until 2015, when new projects in Asia and Australia come
"In total, we see global LNG capacity growing by 8.4 million
tons to 277 million tons in 2013, and see even less growth of
4.4 million tons in 2014," BofA Merrill Lynch analysts said in
"We expect production from existing gas fields to decline by
1.5 trillion cubic meters a year, meaning that new supply will
actually have to grow by 2.4 trillion cubic meters a year,
which is a growth rate of 9% a year, to cover demand growth and
the decline in existing production," Mr. Hill said.
He said BG Group expects demand to rise with as many as 30
more countries trying to import LNG.
BG also expects India, China, Japan and South Korea
to become the world's top LNG importers by 2025.
Mr. Hill said around 22.4 million tons of LNG
was diverted from suppliers in the Atlantic basin to meet
surging demand in the Pacific basin in 2012, of which one-third
was diverted by BG Group alone.
Dow Jones Newswires