Drewry Shipping Consultants Ltd. predicts strong growth in LNG and LPG seaborne shipments during the next few years.
Outlook for liquefied gas trading has rarely been better, the London firm says.
Seaborne trade in LNG will rise to 52 million metric tons this year from 45 million last year and only 40.9 million in 1987. This rapid growth will continue with shipments totaling 62.5-73.5 million metric tons in 1995.
Growth in LPG seaborne trade has not been as brisk.
Shipments will reach 31.1 million metric tons this year, based on returns for the first quarter. The business has built up from 26.2 million metric tons in 1987 and should reach 35 million in 1995.
LNG DEMAND
Demand for LNG has been stimulated by increasing concern about the environment, which has highlighted the clean burning properties of gas.
In Japan, says Drewry's report, LNG imports have risen from 15 million metric tons in 1983 to 32 million metric tons last year. Projections are for imports of 40-50 million metric tons/year by the turn of the century.
Other Far East growth markets are South Korea, where imports will grow from 1.5 million tons in 1987 to 4-6 million tons by the end of the century. Taiwan, which began importing LNG last March, could be importing 35 million metric tons/year by 2000. Drewry says in the Atlantic Basin, the bright outlook for LNG trade is tempered by realization that it faces stiff competition from other energy sources, notably pipeline gas.
In the U.S., Drewry says, the gas surplus is a thing of the past. Gas utilities are becoming increasingly concerned about securing supplies, which should lead to opportunities for LNG imports.
LNG producers are using surplus liquefaction capacity to meet growing demand for LNG. They are also contemplating adding capacity.
Nigeria's LNG export project is scheduled to get under way in 1995, but few other projects in the planning stage are likely to be operational before the late 1990s.
In the meantime, deliveries under existing contracts are likely to rise-if shipping capacity is available. But Drewry says examination of voyages completed by LNG carriers in 1989 reveals that under most contracts there is very little room to increase deliveries, given the size of the current LNG tanker fleet.
Employing a small number of idle LNG tankers would provide some added tonnage, but the report says in the long run newbuildings will be required if trade is to expand at the forecast rates.
LPG SHIPMENTS
Drewry cites 1989 as a golden year for LPG shipping companies with freight rates at record highs, reflecting, in part, continued growth in seaborne trade. Other positive factors for carriers were a static fleet at 7.8 million cu m capacity and increasing concentration of vessel ownership in the hands of a small number of companies.
The report says if the volume of tanker orders in 1989 is not repeated in 1990, projected increases in LPG trade should absorb capacity on order. As a result, freight rates for most sizes of LPG tankers appear set to remain comparatively buoyant for the next 1-2 years.
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