Global LNG imports net of reloads last year reached 236.3 million tonnes, a 1.9% (4.5 million tonnes) decrease compared with 2011 trade movements, according to a report issued Mar. 25 from Paris-based Groupe International des Importateurs de Gaz Natural Liquefie (GIIGNL).
The group said maintenance and unscheduled interruptions on existing liquefaction plants, as well as lower-than-expected capacity additions, with only one new train—Pluto in Australia—coming into service in May, have limited supply availability.
GIIGNL said increased demand, mainly in Japan, China, India, and South America contributed to the market tightness.
On the supply side, six countries joined the ranks of exporters over the last 10 years. Eight countries out of a total of 18, however, made up 83% of global LNG exports at yearend 2012.
LNG supplies from the Pacific Basin declined 3%, or by 2.7 million tonnes, despite new volumes from Australia and the quick ramp-up of Pluto. Indonesia (-13.3%) and Malaysia (-4.8%) accounted for most of the production decline in the region.
In the Atlantic Basin, three suppliers—Nigeria, Norway, Trinidad and Tobago—increased their production, but lower export levels from Algeria, Egypt, and Equatorial Guinea depressed overall Atlantic Basin supply by 2.2%.
In the Middle East, production shutdowns in Yemen reduced total exports by 500,000 tonnes, despite 1 million tonnes additional supplies from Qatar, said GIIGNL’s report. Of Qatari volumes, 63% were exported to Asian countries, with Japan retaining the lion’s share.
For 2010-12, Qatar doubled its LNG exports to Japan (15.7 million tonnes in 2012 compared with 7.6 million tonnes in 2010). Qatari exports to South Korea jumped by 56% for the same 3 years, reaching 10.8 million tonnes, or 29% of South Korea’s LNG supplies.
On the demand side, seven importing countries out of 26 (Japan, South Korea, China, India, Taiwan, Spain, and the UK) attracted 81% of total LNG volumes. Japan and South Korea’s combined share was about 53%.
For the second year in a row, said the group’s report, all Asian countries recorded import growth.
Resulting from a weak gas demand, lower imports into Europe provided for the swing between global supply and demand. Asian countries imported 14.2 million tonnes of additional quantities, 9 million tonnes of which were received in Japanese terminals.
At yearend 2012, Asia accounted for 71% of global LNG demand compared with 64% in 2011, and Japan and South Korea together represented 75% of Asia’s LNG imports. In absence of nuclear restarts, Japan recorded an 11.4% growth. South Korean LNG imports increased by 3.4%, above the country’s gross domestic product growth rate of 2%.
The growing appetite for LNG in China and India resulted in 12.2% and 7.7% growth rates, respectively, over the previous year, and both countries represented a combined 11.8% global market share in 2012.
With start-up of the Nusantara regasification terminal, Indonesia started receiving LNG in 2012 (700,000 tonnes), becoming the 26th importing country and—after the US—the second LNG producing country also importing LNG.
GIIGNL found noteworthy Europe’s decline by some 27% because of cargo redirections, reloads, and sluggish gas demand, bringing in the 2012 net LNG imports at less than the 2009 level. With net imports of 14.5 million tonnes—at the same level as that for LNG imports into China—Spain is back as Europe’s leading LNG importer.
In the UK, imports dropped to 10.4 million tonnes (-44%), with 98% of the country’s LNG coming from Qatar and 72% of total imports delivered to the South Hook terminal.
As a consequence of the decline in Europe, the GIIGNL report found 2011’s contrasting trends between the two major basins to be even more pronounced in 2012. LNG deliveries to Asia increased by some 9% (with very single country showing a growth) whereas for the Atlantic Basin deliveries fell back 22% overall.
In the Americas, the LNG market of South America (Argentina, Brazil, and Chile) recorded a 40% growth compared with 2011, reaching twice the size of North America’s market. Following a year of low imports due to a large hydroelectricity production, LNG deliveries to Brazil more than tripled in 2012, reaching 2.7 million tonnes.
LNG deliveries to Chile remained stable, around 2.8 million tonnes. Argentina’s imports increased by almost 15% to 3.4 million tonnes in 2012, 2.3 million tonnes of which coming from Trinidad and Tobago.
Starting in 2013, said GIIGNL, Enarsa will purchase cargoes from GasNatural Fenosa under a 1.5 million tonne, 1-year contract. In Brazil, Petrobras also signed a 1-year contract with Iberdrola for 360,000 tonnes.
In Mexico, imports increased by 23.8% over 2011, mainly due to the start-up of the Manzanillo regasification terminal on the country’s Pacific Coast and the reception of volumes from Peru under a term contract.