Understanding Today's Global LNG Business

Natural gas demand worldwide is exploding. Driven by economic growth and the environmental advantages of this clean burning fuel, world consumption of natural gas increased by 25% between 1993 and 2003. This growth is just the beginning. Between 2003 and 2010, world consumption is expected to increase another 15% and by 2025 it is expected to increase by more than 60% over 2003 levels. To meet this new growth alone, over the next 20 years we will need to add new production capabilities equal to current North American, European and Asian production combined. Transportation of these supplies will also present challenges. Unfortunately for con- sumers, sources of natural gas are often inconveniently located far from areas of con­ sumption. While North American markets have historically been served by Canadian and U.S. production, it now appears that future continental supplies will be inade­ quate to serve these markers. Meanwhile Western European and Asian consumers, already dependent on significant imports of Russian and Middle Eastern natural gas, will become even more dependent as demand grows and Northern European supplies decline. The solution will be twofold. Where geography allows gas to be transported through pipes we will see significant growth in high volume and long distance pipeline networks. But for much of the world the solution lies in liquefied natural gas (LNG), which can be economically transported via tanker.