LNG, liquefied natural gas, is a technology to transport natural gas, which allows to monetise large gas fields. Since the first LNG cargo from Algeria to the UK in 1964, LNG trade has been expanding rapidly. Now liquefied natural gas has a worldwide reach and LNG imports are increasingly competing with indigenous production and natural gas transported by pipeline.
With substantial cost reductions in the 1990s and recent high gas prices, the LNG sector is experiencing a global construction boom. Qatar has become the world's largest LNG exporter, reaching both the Atlantic and the Pacific markets, while many countries are planning and constructing terminals to import more liquefied natural gas. At the same time, the current high-price environment has triggered cost inflation, and completion delays are beginning to affect these projects.
This report considers:
- How will LNG trade and industry develop?
- What are the implications of fast growing LNG trade on security of supply / security of demand and terminal access regimes?
- What is the outlook for Europe, Russia and Japan?
Finally, as the 1994 Energy Charter Treaty is designed to cover energy trade, transit and investment, this report examines how the Treaty provisions are relevant to LNG trade and how, in turn, LNG trade will affect the Energy Charter Process.
The publication"Fostering LNG Trade: Role of the Energy Charter" is available in English and Russian.