BARCELONA, Spain, Sept 17 (Reuters) - Global trade volumes for liquefied natural gas (LNG) could double in the coming years, Vitol’s chief executive said after the commodity merchant announced a long-term deal to buy the fuel from U.S. producer Cheniere Energy.
“We have 300 million tonnes of LNG traded this year. That figure could easily double in coming years, “ Vitol Chief Executive Russell Hardy said on Monday during an industry event in Barcelona, Spain.
He said demand growth would come from “countries that currently don’t import gas, but which will soon.” The number of nations buying LNG has risen to 42 from 30 in the past three years, with several more in Asia and Africa expected.
Global demand has been rising together with new production facilities, especially in the United States where new liquefaction projects will drive supply growth.
Vitol said earlier it had signed a 15-year offtake deal with Cheniere, the country’s first major LNG exporter with several facilities under construction alongside its four plants at the Sabine Pass terminal on the U.S. Gulf Coast.
Beyond the newcomers, China’s surging consumption due to its huge gasification programme will push trading volumes. Chinese LNG imports have risen over 40 percent so far this year and it became the second largest importer in the world last year.
Zou Caineng, Vice President for Petroleum Exploration and Development at PetroChina’s Research Institute said China’s natural gas demand was 240 billion cubic metres (bcm) last year.
“By 2030 it will be 520 bcm,” he said at the same event, adding that 40 percent of that demand would be met by imports. Aside from LNG, China imports pipeline gas from Central Asia and Myanmar and these will be boosted by Russian flows next year.
With new importers coming to market, U.S. energy giant Exxon Mobile Corp said trade volatility in LNG would rise.
“We are seeing the (LNG) world being reordered,” said Peter Clarke, President of ExxonMobil Gas and Power Marketing Company, also talking at Gastech in Barcelona.
“Spot trading has come in. There are more buyers and sellers than ever before ... For an industry that has relied on stability (of fixed long-term contracts), the watchword is volatility,” Clarke said. (Reporting by Henning Gloystein; editing by David Evans)