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Startups in U.S.,

Australia, Elsewhere

Global LNG Storylines

• Australia wrapping up

startup of its latest

liquefaction wave; U.S. set

for big years from 2018-

2020

• First exports from an

FLNG (PFLNG Satu) and

the Arctic (Yamal LNG)

• Brownfield expansions

being considered in Qatar,

PNG

Another inflection point on the horizon?

New Markets

Opening Up

• FSRUs opening up small

markets with growth

potential in Southeast

Asia, Africa, Latin America

• South Asia becoming next

major import destination

with India, Bangladesh,

Pakistan terminals

• Environmental concerns

leading to greater demand

and concerted

governmental efforts to

add gas to energy mix

(India, China)

Lack of Liquefaction

Investment

• Only one positive FID

taken in 2017 – 3.4 mtpa

at Coral FLNG in

Mozambique

• Other once-promising

projects have been

shelved across the world,

including in Canada

• Lack of projects in early-

to mid-stages of

development


Asian Gas Demand

• Gas demand in Asia to be fueled primarily by electricity generation demand,

particularly in fast-developing markets in South and Southeast Asia

• Increased industrialization fuels strong secondary demand growth

• On-road transportation, while remaining a minor factor, will experience large relative

growth, mostly in China

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

160.02010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

Bc

f/d

LNG Exports

Non-RoadTransportationCommercial

Energy

Residential

Electricity

On-RoadTransportationIndustrial


Asian LNG Imports

• Japan and Korea historically have led the way in Asia, but have experienced little

growth and have low growth prospects going forward

• China has seen massive growth quickly, becoming the second largest importer

• Developing nations of South and Southeast are poised to lead the next round of

growth in the global LNG industry

0

50

100

150

200

250

3001995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

MT

PA

Indonesia China

India Rest of Asia

South Korea Japan


Import Tipping Point?Regas technology cheaper, quicker to bring online than ever

Source: GIIGNL, Stratas Advisors

0

10

20

30

40

50

60

0

200

400

600

800

1000

1200

2011 2014 2017 2022

Imp

ort

ers

MT

PA

Regas Capacity Importing Countries


Potential Liquefaction Capacity Needs

*Does not factor in liquefaction retirements

Looking beyond current positive FIDs and construction

29.7 29.3 32.038.9 55.2

72.8 85.8 101.2 117.4 134.6 153.6

0

100

200

300

400

500

600

2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

MT

PA

Implied Need Liquefaction Capacity Global LNG Demand

Mozambique moving ahead with onshore,

floating solutions

Tanzania now into years of delays, mostly

caused by regulatory issues

East Africa

Regulatory backlog cleared in the US, now

backers face commercial decisions

Canada facing its last and best major hope with

Shell, Petronas in LNG Canada

North America

Sanctions from the West have slowed but not

altogether stopped development

Northern Sea Route opens up access to Asia

from Siberia

Russia

Moratorium on North Field development lifted

in 2017

Expansion of 30% planned for completion by

2023-2025

Qatar

Competing Global Liquefaction

East Africa

N. America

Russia

Projects in development, not yet under construction

23

Qatar

73.6

26.3

26

*In MTPA of proposed capacity


Market Dynamics – Trends and Pricing

• To avoid huge margin mismatches,

contracts moving away from multi-

year oil linkages

• Henry Hub becoming more popular for

indexation globally

• Other gas hubs could emerge in Asia

to set regional prices

Contracting Trends

• Spot trade has risen significantly,

spurred on by China and an

increasingly liquid market

• Inflexible contract terms going by the

wayside – destination clauses, oil-

linkage, 20-year agreements

Technological Achievements Hub Indexing


Political Considerations

• Monitoring the trade ties between Russia and China, India

and Iran

• How active will Trump administration be in supporting more

U.S. LNG, and what effect would a trade war have?

Liquefaction FIDs

Emissions Targets and Regulations

• Will importers in Asia and elsewhere begin to think longer-

term before it’s too late?

• Are brownfield expansions the answer in more than just the

short-term?

• IMO shipping regulations – how many shipowners will

switch to LNG for fuel?

• Will other major consumers follow aggressive gas energy

mix targets set by India, China?

Questions Moving Forward

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