Asian LNG imports rose by 10.5 million metric tons (mmt) in 2023 versus 2022, the largest year/year change for any market, according to the International Gas Union’s (IGU) newly published 2024 World LNG Report.
China regained its spot as the world’s top importer at 71.2 mmt in 2023, up 11.95% from 2022. India saw an increase of 9.7% to nearly 22.0 mmt, while new importers Vietnam and the Philippines added their names to the list of liquefied natural gas-thirsty consumers in Southeast Asia.
The trend supports the business case of the dozen or so LNG export terminals proposed for Mexico, most of which plan to re-export U.S. pipeline gas to the Asia Pacific market from Mexico’s Pacific Coast.
Mexico had 7.45 mmty approved or under construction as of the report’s publishing, IGU researchers said. These include the 1.4 mmty Altamira Fast LNG Phase 1 offshore terminal, which sponsor New Fortress Energy Inc. said would enter operation in July. Sempra Infrastructure’s 3.25 mmty Energía Costa Azul Phase 1 terminal also is under construction in Baja California and due to begin sending out cargoes in 2025.
IGU tallied 48.8 mmty of aspirational, pre-final investment decision (FID) liquefaction capacity proposed for Mexico. Since the projects mostly depend on U.S. feed gas, they could be impacted by the Biden administration’s pause on approvals for LNG exports to non-free trade agreement countries.
The global LNG trade grew by 2.1% year/year to a record 401.42 Mt in 2023, slowing from the 5.6% growth in 2022, IGU found.
“It is likely that in the space of five to six years, the world’s LNG export capacity will grow from circa 400 mmty to 700 mmty,” researchers said. “This potential massive increase is an emphatic demonstration that the world still needs more LNG…driven [primarily] by demand in Asian developing economies and China. Peak LNG demand is not likely to be reached until the 2040s.”
Latin America Imports Up
Latin America’s net LNG imports totaled 9.42 mmt in 2023, up from 8.85 mmt in 2022. The United States and Trinidad and Tobago supplied 5.6 mmt and 2.32 mmt of Latin America’s import total, respectively.
IGU defines Latin America as including Central and South America as well as the Caribbean, but not Mexico, which it classifies as North America.
Brazil’s LNG imports plunged from 1.9 mmt in 2022 to 0.7 mmt in 2023, “as strong rainfalls and high reservoir levels lifted hydropower output and weighed on gas-for-power demand,” the IGU authors said. “This dragged down its regasification utilization to only 2% in 2023 from about 7% in 2022.”
Colombia’s imports, meanwhile, increased nearly eight-fold to 0.77 mmt. Researchers noted that, “Colombia issued tenders seeking at least five cargoes due to drought affecting hydropower levels. As a result, the country doubled its imports in the third quarter of 2023 versus 2Q2023.”
Latin America as a whole “purchases most of its cargoes in preparation for winter in the Southern Hemisphere,” researchers said, with 65.5% of net imports on the spot market versus long-term purchases at 34.5%.”
Latin America’s regasification capacity remained unchanged in 2023 versus 2022 at 53.8 mmty.
There were 17 floating and offshore regasification terminals under construction as of February with a combined throughput capacity of 52.1 mmty, including 10.2 mmty in Latin America.
Brazil currently has seven floating storage and regasification units (FSRU) in operation totaling 34.6 mmty, or 58% of Latin America’s capacity as of end-February, researchers said.
They added, “The instability of the domestic renewable output has resulted in uncertainty over Brazil's LNG import demand, and therefore, flexible FSRU-based terminals will likely remain a preferred option in Brazil, compared to onshore terminals.”
Five new regasification terminals – four new floating-based and one onshore – are currently under construction in Latin America, with combined capacity of 10.2 mmty. These include two projects in Brazil totaling 7.8 mmty, a 1.1 mmty terminal in Panama and a 1.3 mmty facility in Nicaragua.
Researchers noted that Chile also approved its fourth terminal last year, the 3 mmty GNL Penco-Lirquen project, which is due to enter service in 2027.
