Analyst Wood Mackenzie is predicting a 17 million tonne a year (mta) increase in LNG supply this year, bringing total global supply to 267mta – although uncertainty over timing could push this year’s increase down to 10mta.
“Uncertainty around the exact timing and ramp-up of volumes could take its toll, with year-on-year growth in 2016 limited only to 10mta,” Wood Mackenzie’s Insight: global gas and LNG report notes. “With 125mta under development, real LNG growth is expected to develop post-2016.
Wood Mackenzie notes that the big supply interest will be the first-quarter start of mainland US LNG exports from Cheniere’s Sabine Pass terminal and that this year’s largest growth in output will come from Australia. Here, new projects Australia Pacific LNG and Gorgon LNG will bring their first volumes to market shortly and Queensland Curtis LNG and Gladstone LNG are ramping up their exports.
“We expect additional LNG supply from the restart of Angola LNG and from the world’s first floating LNG (FLNG) project in Malaysia,” it says.
“[However] low prices will force most LNG projects targeting final investment decisions (FID) in 2016 to defer – but not all, with western Canada and smaller-scale FLNG projects the most likely to proceed. In aggregate, 20mta of LNG FIDs are imminently possible in 2016, which could prolong the period of oversupply.”