Continuing weak demand and excess tonnage are set to depress LNG shipping earnings in the near term, Drewry analysts forecast. Yet there's a silver lining further out, as rates will rebound over anticipated vessel shortages once an array of proposed liquefaction projects start operation.
China's natural gas and LNG demand will almost double through 2019 and private companies in Australia, Canada and the US are helping to propel the LNG business forward rather than state-owned energy groups, the International Energy Agency (IEA) said in its 2014 Medium-Term Gas Market Report released in the Canadian city of Montreal.
The BP Statistical Review of World Energy 2014 said LNG's share of the global natural gas trade declined slightly to 31.4 percent as trade grew by just 1.8 percent, well below the historical average of 5.2 percent.
Prices for delivered LNG from Australia into the Northeast Asian market largely increased in the first part of 2014 as Japanese delivered cargoes rose from US$16.4 a gigajoule (US$15.5 per million British thermal units) to US$17.6 a gigajoule (US$16.6 per MMBtu), according to the latest official figures.
Lower capital costs, shorter on-stream time, lower coastal environment impact and flexibility are some of the reasons that led to the development of the LNG Floating Storage and Regasification Unit, (FSRU) and Floating Production Storage and Offloading (FPSO) vessels.
Westport is active in developing natural gas engine and mobile LNG fuel supply solutions for the high fuel-use sectors of rail, mining, marine and oil & gas and has a successful on-road business.