Will liquefied natural gas catalyze a global natural gas market?
Even as critics still debate whether liquefied natural gas (LNG) can be made economical to compete against regional gas sub-markets, the growth in LNG trade has many convinced that it has the potential to create the basis for a global gas market.
In fact, LNG trade has more than doubled in the past 15 years. Consumption of LNG is increasing [at a compounded annual growth rate (CAGR) of 4.9 percent] more rapidly than the consumption of pipeline gas (CAGR 3.6 percent). This growth is due to falling investment costs for liquefaction, shipping, and regasification. The cost of liquefaction has more than halved since the late 1960s. Compared to pipeline gas, where transport costs develop proportionally to the number of kilometers covered, LNG already shows a cost advantage upwards of a 2000-km transport route.
The future growth of the LNG market will be driven by four key factors:
The Future Role of LNG
Deck:
Will liquefied natural gas catalyze a global natural gas market?
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