Japan and China exchange policy forecasts on LNG and pipeline gas

Japan and China exchange policy forecasts on LNG and pipeline gas

Elena Fuertes Elena Fuertes

Elena Fuertes

Territory Lead, Corporate Accounts at Euromonitor International

发布日期: 2017年11月30日
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Chinese and Japanese energy analysts have met in Beijing to exchange views on the challenges facing their respective countries and the key issue to emerge was that LNG and gas demand in China has resumed its rapid expansion because of four main factors.

The latest North Asian LNG and pipeline natural gas strategy outlooks were discussed at the 11th China-Japan Joint Symposium on Oil & Gas in the Chinese capital Beijing.

The China National Petroleum Corp. (CNPC) Economics and Technology Research Institute and the Institute of Energy Economics in Japan have co-sponsored the annual event alternately in Beijing and Tokyo.

The two institutes again presented reports on the most important and relevant energy market challenges in their respective countries.

The most impressive point was the Chinese report that natural gas demand in China is resuming rapid expansion after a temporary growth deceleration, participants noted in a presentation called “China Natural Gas Market Status and Outlook”.

Our photograph shows the arrival of a US LNG cargo at the Chinese Port of Tianjin, the maritime gateway to Beijing.

“Factors behind the natural gas demand recovery include an economic growth recovery, business environment improvements for energy-intensive industries, enhanced air pollution counter-measures and LNG import price drops through crude oil price plunges and global LNG oversupply,” said the report from Duan Zhaofang, a senior natural gas market researcher at the Chinese research body.

“China's natural gas consumption in the first nine months of 2017 increased by 17 percent from a year earlier.

“In line with the demand expansion, domestic gas production grew by 11 percent and imports posted an even steeper expansion of 21 percent.

“Particularly, LNG imports increased by 35 percent to 33.3 billion cubic metres, surpassing 31.5 Bcm in pipeline gas imports,” said the report.

The conference noted, however, that overall the Asian and global LNG market is still in a situation of oversupply.

A mainstream view among Japanese and Chinese LNG market participants was that while LNG demand would continue to expand mainly in Asia, oversupply will remain until around 2023 as LNG projects subject to past investment decisions, mainly in Australia and the US gradually come on stream.

That said, participants also noted that China may sharply expand gas demand by switching from coal to gas, promote more gas market reform and develop more infrastructure including pipelines and LNG terminals.

A Japanese report from the IEEJ said that depending on shale and other domestic gas resource developments, China's gas demand could expand even more than expected.

The Chinese report forecast that China's LNG imports would expand rapidly from 27 Bcm in 2015 to 60 Bcm in 2020 before growing more slowly to 70 Bcm in 2030 due to assumed domestic shale gas development and increasing pipeline gas imports.

“It is very difficult to accurately project the future course,” said the IEEJ.

This article is published at www.lngjournal.com

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