Overall, global LNG demand is estimated to hit 700 million tonnes by 2040, Shell has declared.
“Asia is expected to drive nearly 75% of this growth as domestic gas production declines and LNG substitutes higher emission energy sources, tackling air quality concerns and meeting emissions targets”, the AngloDutch major says in a new report., which also indicated that the demand for LNG had held steady in 2020, despite COVID-19.
The report projects a strong Asian demand, giving an example of China’s heavy-duty transport sector which “consumed nearly 13Million Tonnes of LNG in 2020, almost doubling from 2018, to serve the fast-growing fleet of well over 500,000 LNG-fuelled trucks and buses’.
Shell’s LNG Outlook 2021 www.shell.com/lngoutlook reports that LNG-fuelled shipping is also growing, “with the number of vessels expected to more than double and global LNG bunkering vessels set to reach 45 by 2023.
“As demand grows, a supply-demand gap is expected to open in the middle of the current decade with less new production coming on-stream than previously projected. Just 3Million Tonnes in new LNG production capacity was announced in 2020, down from an expected 60Million Tonnes”, the report testifies.
“According to estimates, more than half of future LNG demand will come from countries with net-zero emissions targets. The LNG industry will need to innovate at every stage of the value chain to lower emissions and play a key role in powering hard-to-abate sectors”, Shell notes.