DOHA: The global LNG liquefaction capacity is expected to grow by 86 to 462 mtpa, while the LNG trade is anticipated to be over 310 mtpa in 2018 and over 350 mtpa in 2019, a growth mainly driven by Australia, US and Russia, said an expert at the Doha-based Gas Exporting Countries Forum (GECF).
Aydar Shakirov, Gas Transportation & Storage Analyst at the Gas Market Analysis Department of GECF said recent years have witnessed a steady and robust growth in liquefaction capacity and LNG trade volumes. From 2012 to 2017, the global LNG liquefaction capacity increased by 92 to 376 mtpa, the global LNG trade rose by 56 to 288 mtpa and the global LNG shipments grew by 707 to 4,702 cargoes.
The expanding global LNG liquefaction capacity, growing global LNG trade and increasing number of global LNG shipments require an adequate growth in the number of LNG vessels and their shipping capacity.
From 2012 to 2017, the number of LNG vessels worldwide increased by 133 to 467 vessels. In the same period, the total capacity of all LNG vessels increased by 10 to 33 mtpa.
The number of LNG vessels and their capacity increased in line with the growing LNG trade and expanding LNG liquefaction capacity. In 2018 and 2019, 73 vessels are expected to be commissioned with overall capacity 5.5 mtpa, which is considered to be enough to meet the growing LNG demand.
However, such factors, as the completion of the delayed LNG plants, massive exports from the remote US, a smaller number of vessels to be commissioned after 2019 and the growing share of LNG spot trade, might lead to a shortfall in available LNG vessels starting from 2020.
Since the construction of an LNG vessel may take at least two years, key stakeholders might take investment decisions on new LNG shipping capacity soon in order to increase vessel availability in the medium term.
The most effective way for the GECF countries to not depend on the vessels availability, avoid the charter rates volatility and optimise shipping costs is to own LNG vessels individually or jointly with recognised partners. Besides, the practice shows that charter rates under long term shipping charter contracts are usually lower compared to the ones under spot charter contracts.
