January 9, 2024
The global Liquified Natural Gas (LNG) market experienced a turbulent year in 2022. The market upheaval caused by the Russia/Ukraine conflict has stimulated significant interest in liquefaction and regasification facilities as markets seek to re-establish energy security priorities.
LNG Exports by Country 2022
Reference: International Gas Union (IGU) 2023 World LNG Report. (2023, July 12). 3.2 LNG Exports by Market (2023 World LNG Report | IGU).
In 2022, there were 20 countries exporting LNG led by Australia, the US, Qatar, Russia, and Malaysia. Combined, these top exporters accounted for 75% of the world total. Australia retained its position as the largest exporting country in 2022 sending out 81 mtpa versus 79mtpa in 2021. Australia was followed closely by the US who exported 80.5 mtpa and Qatar at 80 mtpa.
The US recorded the largest growth of any country from 2021 to 2022 at over 10 mtpa. They are on track to become the world’s largest exporter of liquefied natural gas (LNG) in 2023 as new projects come onstream, with much targeting Europe as they seek to offset Russian gas supply.
Global Liquefaction Capacity Growth 2022-2028
A total of almost 20 million tons per annum (mtpa) of new LNG liquefaction capacity was brought online in 2022, pushing the global total to over 475 mtpa, a 4% increase over the 456 mtpa in 2021. This is equivalent to an additional 2.6 Bcf/d of natural gas demand which increased the total global natural gas demand to almost 62.0 Bcf/d in 2022 from 59.3 Bcf/d in 2021.
The US Gulf Coast region accounted for 75% of the capacity increase in 2022 as Sabine Pass LNG T6 (5.0 mtpa) and Calcasieu Pass LNG T1-T18 (10 mtpa) became operational in February and May 2022 respectively. The US now has the largest operational liquefaction capacity worldwide at almost 90 mtpa. Other facilities that became operational in 2022 include:
- Russia’s Portovaya LNG T1 (1.5 mtpa) finally started commercial operation in November 2022 after delays.
- Mozambique’s (3.4 mtpa) Coral South Floating Liquefied Natural Gas (FLNG) also shipped its first LNG cargo in November 2022.
Two additional liquefaction projects are expected to begin operations in 2023:
- Tangguh LNG T3 in (3.8 mtpa) in Indonesia began operations in October.
- Mexico’s’ Altamira FLNG (2.8 mtpa) was supposed to begin operating in September but has since been delayed to December.
At April 2023, almost 180 mtpa of liquefaction capacity was either under construction or approved for development, of which about 45% is in North America (primarily the US). Just 3 short months later, in July 2023, this had increased to 210 mtpa being developed as some projects in USA and Canada were approved during that time span. In total, global liquefaction capacity is expected to reach almost 685 mtpa (about 90 Bcf/d of natural gas) in 2028, up over 200 mtpa (~40%) from the 475 mtpa recorded in 2022.
Liquefaction Capacity by Country 2028
By 2028, 24 countries will be exporters of LNG including four new countries: Mauritania, Mexico, the Congo, and Canada. In fact, Canada, who at one time had 18 projects totaling over 200 mtpa (27 Bcf/d) of capacity (almost all of which have since been cancelled), will become a top-10 exporter led by the LNG Canada facility on the west coast. The US, who is expected to account for about 25% of global LNG supply in 2028, leads the world by a significant margin in both capacity and overall LNG export quantities, surpassing heavyweights Australia and Qatar.
Globally, there is about 1000 mtpa of new liquefaction capacity in the pre-FID (Final Investment Decision) stage. However, many of these projects are unlikely to proceed due to weak fundamentals and/or geopolitical factors.