The Shell LNG Outlook, now in its fourth year, highlights key trends in 2019. It finds that global demand for liquefied natural gas (LNG) grew by 12.5% to 359 million tonnes in 2019, a significant increase that bolsters LNG’s growing role in the transition to a lower-carbon energy system.
Europe absorbed the majority of 2019 supply growth as competitively-priced LNG furthered coal-to-gas switching in the power sector and replaced declining domestic gas production and pipeline gas imports. There was a modest rise in imports to Asia in 2019, compared to the previous two years, a result of mild weather and rising electricity generation from nuclear power in Japan and South Korea, two of the three largest global importers.
In the short-term, supply growth is expected to slow down as the last of the new LNG projects under construction will be completed by 2021, restoring equilibrium.
Longer-term demand is expected to double to 700 million tonnes by 2040 according to forecasts, spurring confidence in the role of gas in shaping a lower-carbon energy system.