The International Gas Union (IGU) has said that global LNG trade in 2016 reached a record 258 million tonnes – an increase of 5% from 2015, and the largest ever year for LNG trade. IGU released its 2017 World LNG Report on April 5, noting that this dramatic increase is particularly noticeable when compared with the average 0.5% growth rate of the previous four years.
This jump can primarily be attributed to a significant increase in new supply, due largely to the start of exports from the US Gulf of Mexico, as well as the start of commercial operations in Australia Pacific LNG, among others, IGU said. These new projects come about as governments, businesses and consumers become increasingly aware of the advantages of natural gas in the global energy mix, and are encouraging trends pointing to further growth in the LNG market.
There was also significant inceases in demand as LNG finds a role as a fuel of choice in new markets, IGU said. The most pronounced increase in demand comes from Asian markets, with China’s LNG consumption increasing dramatically by roughly 35% to 27 million tonnes per annum (MTPA). On the flip-side, some markets – including Japan and South Korea as the two largest – have shown signs of satiation as other forms of energy come to the fore, in part showing the flexible value of LNG as a fuel source. This was particularly prevalent in Brazil, where resurgence in hydropower has reduced demand for LNG by 80%.