WILL LNG TRADING LEAD TO A GLOBALISATION OF NATURAL GAS MARKETS?

摘要

The comparatively high cost of transporting natural gas over long distances by pipeline or as LNG has resulted in markets developing on a regional rather than global basis. Prices, contractual terms and project structures vary considerably between the main markets in Asia, Europe and N. America. Although LNG provides a more flexible linkage between resource and the markets than pipelines, there has only been limited trading of LNG between the regional markets. In 1999, over 97% of LNG production was sold to customers under long-term contract. However, the business is undergoing substantial change. Demand is expected to nearly double from 90 mtpa in 1999 to 170mtpa by 2010 with new buyers and sellers entering the market. Buyers are looking for more flexible contracts to meet changes in markets. Projects such as Trinidad and Tobago have shown that a step change in plant costs can be achieved and competition between shipyards has resulted in a substantial reduction of LNG tanker costs. As a result, projects are now able to go ahead without securing sales contracts for all the planned production while LNG tankers are being built on a speculative basis. The ability of the large US natural gas market to absorb LNG supplies is being recognised and companies are competing to secure cargoes of LNG for that market and to secure capacity in US receiving terminals. As a result, we can expect LNG trading to increase significantly over the next decade and this could result in a convergence of natural gas markets and a change in the pricing of LNG.