18 June 2013 03:59 [Source: ICIS news]
WASHINGTON (ICIS)--Increased exports of liquefied natural gas (LNG) out of the US will have a big economic impact on the import markets as two-thirds of US LNG will find its way to the Pacific Rim, an industry analyst said on Monday.
There will be a major reorientation of global natural gas trade toward the Pacific, according to Jason Bordoff of Columbia University’s Center on Global Energy Policy. Over time it will flow out mainly out of North America, but also, Africa, Russia and Australia and into China, Japan and India.
North American LNG exports can lower costs in the Pacific and boost competition, but transportation costs mean the high regional price differential will persist, Bordoff said during the Energy Information Administration (EIA) 2013 Energy Conference.
However, over the long term, LNG supply is expected to exceed demand expectations.
“The current tight global LNG market will ease,” said Wolfgang Moehler of HIS during the panel discussion. “The main driving countries of LNG demand is coming from Asia, where Japan is the largest importer.”
According to Moehler, a rapid increase in LNG supply is on the horizon but at high costs.
“Spot prices will remain high in next few years,” he said.
The EIA Energy Conference runs through Tuesday.
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