As the U.S. LNG sector continues to develop rapidly, growing global demand will offer the country the chance to solidify its position as a major global supplier, according to research and consulting firm Morningstar Inc.
A March 5 outlook from Morningstar said prospects for U.S. LNG are bullish as the world asks for more natural gas. The firm said more U.S. gas will be ready to move overseas with the growing number of LNG export terminals coming online, the large amount of U.S. shale gas production, and renewable energy sources shouldering a greater share of U.S. power generation.
"The U.S. gas market is undergoing a structural shift that threatens to shake the established global LNG order," Morningstar said.
In the long term, the significant amount of domestic supply should allow the U.S. to help meet rising global demand. "Growth in export capacity, coupled with strong global demand from Asia and Europe, gives low-cost U.S. shale producers a strategic advantage," Morningstar said.
Asian customers are likely to demand an increasing portion of U.S. LNG exports, surpassing European customers. China is working to improve its air quality and shifting residential and industrial customers away from coal and toward gas. LNG imports to the country could rise to 9.7 Bcf/d by 2024, according to the report. Cheniere Energy Inc.'s contract with a China National Petroleum Corp. company, the first long-term LNG agreement between a U.S. company and a Chinese company, could be the start of many Chinese agreements supporting U.S. LNG projects, Morningstar said.
