LNG spending to reach $25.4 billion by 2011
The LNG market is set to see dramatic growth with annual expenditure forecast to reach $25.4 billion by 2011. Global capex on LNG facilities for 2007-2011 is expected to total over $110 billion - a growth of 197% relative to the previous five year period (2002 -2006).
LNG Facilities capex by type (2002 - 2011)
Liquefaction plants and LNG carriers account for the largest share of forecast spends - each representing 38% of the total. Regarding liquefaction plants, the most noticeable trend (other than the sheer number of developments) is the move towards larger process trains. The largest train size during 2002-2006 was around 4.8 million tons per year. For the forecast period, the largest train size is 7.8 million tons per year and the average train size is rising.
Regarding LNG carriers, a determination to achieve economies of scale is apparent, with ever-larger carriers and orders in place for vessels reaching at least 270,000 cu m (9.53 MMcf) capacity.
Import terminals will also see rapid growth in expenditure, from $6 billion over the period 2002-2006 to almost $26.5 billion forecast during 2007-2011 - a growth of 341%. The key drivers for the increase in import terminal expenditure are growth in gas demand relative to declining production in many regions and, perhaps more crucially, a desire to develop energy security through supply diversification.
--Douglas Westwood
