Azernews.Az

By Trend

Despite a rebalancing global liquefied natural gas (LNG) market, 2019 will be a record year for LNG project sanction, with in excess of 60 million metric tons per annum (mmtpa) of capacity likely to take final investment decision (FID), well above the previous 45 mmtpa sanctioned in 2005 and a tripling of the 21 mmtpa sanctioned in 2018, Trend reports citing Wood Mackenzie research and consulting company.

The company expects that Asian LNG demand growth will not keep pace with LNG supply and Europe, northwest Europe in particular, will have to absorb the surplus, especially during the summer.

But Europe needs additional imports and flexibility, given its increased reliance on maxed-out Russian and Norwegian imports, according to Wood Mackenzie. “ While there will be more LNG imports than required, providing competition to pipe imports and putting pressure on prices, we think this will unlikely bring the level of oversupply that some fear.”

“Our forecast for 2019 is for title transfer facility (TTF) to average $6.9/mmbtu (from $8/mmbtu in 2018) and Asian LNG spot prices to average $8.5/mmbtu (from $10.3/mmbtu in 2018) assuming normal weather patterns. But weather is something we will watch closely in Q1 2019, a mild end to winter could send more LNG into Europe and drive prices down further,” said the consulting company.