Charles Ellinas
With Noble, Delek and Shell requesting to renegotiate their Production Sharing Agreement (PSA) with Cyprus, and particularly the formula for sharing potential profits, LNG is back in the limelight in Cyprus. But how is LNG faring in a world with a glut of energy supplies, brought about by the inexorable increase in renewable energy?
This was the subject of recently released Global Annual Reports by the International Group of LNG Importers (GIIGNL) and the International Gas Union (IGU) on the performance of the LNG industry in 2017, and they make a very interesting reading.
Global LNG imports in 2017 recorded their highest annual growth rate since 2010, at 9.9 per cent, reaching 289.8 million tonnes. New liquefaction capacity continued to come online in various areas of the world ranging from the US to Australia, Malaysia and Russia, leading to a 26.2 million tonnes/yr increase in LNG supply compared with 2016.
Expectations of an LNG surplus did not materialise, as, among other factors, rising imports into China contributed substantially to balance the market.
Key conclusions are:
