The U.S. LNG sector is benefitting from a dramatic increase in funding, contracts, and approvals of new LNG export terminals since Russia’s invasion of Ukraine, part of a global surge in export capacity that is also being led by Russia, Canada, Mexico, and Qatar, according to a report from Global Energy Monitor (GEM). The report also finds a substantial increase in new LNG import terminals under development, led by China, India, Brazil and Germany.
Key findings:
- North America has the most LNG export capacity in development by region, 461 mtpa of projects costing an estimated US$321 billion, led by the U.S. with 322.5 mtpa, Canada with 75.6 mtpa, and Mexico with 62.5 mtpa.
- The U.S. became the leading exporter of LNG in the first half of 2022, and development of new export projects has been accelerating since February 2022, with two terminals achieving final investment decisions (FID) and five securing their first long-term contracts. The U.S.’s 322.5 mtpa of new projects comprises half of global export capacity under development.
- Despite sanctions and a shrunken market for its existing gas supplies, Russia is seeking to develop 113.4 mtpa of new export capacity.
- For U.S. projects, sales and purchase agreements signed since February 2022 are predicated on new and increased exports to countries whose energy markets have been disrupted by the war in Ukraine and resulting energy crisis in Europe, including China, South Korea, Malaysia, Germany, Poland, and the UK.
- Asia has the most new LNG import capacity in development, 442.2 mtpa of projects costing an estimated US$120 billion, which is 65% of the world’s LNG import terminals in development. Import projects in Europe amount to 164.7 mtpa and comprise 24% of the global total.
“Europe’s energy crisis will ultimately accelerate the transition to renewables,” said Robert Rozansky, a research analyst at GEM. “However, in the short term, the gas industry is using the current energy crunch to push a dangerous expansion of export and import capacity that will make the climate crisis worse.”
Overall, GEM’s report identifies over 300 projects in the pre-construction and construction phases with an estimated cost of US$797 billion. These LNG terminals in development comprise 682 million tonnes per annum (mtpa) of LNG import capacity (equivalent to 73% of global import capacity operating today) and 779 mtpa of LNG export capacity (or 173% of existing global export capacity).
