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Shell sees Europe’s drive to diversify energy conflicting with a shortage of new investment in LNG projects.Photo courtesy of Stuart Conway/Shell
Between 2021 and 2022, LNG imports to the UK and Europe will increase, with the region looking for alternatives to Russian gas.Photo courtesy of Stuart Conway/Shell
Shell has ample LNG reserves, and gas sales in general accounted for the bulk of its revenue stream in the fourth quarter.Photo courtesy of Stuart Conway/Shell
February 16 (United Press International) — Shell said on Thursday that it expects the LNG market to tighten in the coming years as Europe’s pursuit of non-Russian supplies competes with demand pull from other economies.
Shell in its regular Outlook report For LNG, the market will tighten as demand surges due to limited supply. Growing demand in Europe will compete with limited supply in Asia in the coming years.
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“The war in Ukraine has had a profound impact on global energy security and triggered a structural shift in the market that could have long-term effects on the global LNG industry,” said Steve Hill, Shell’s executive vice president of energy marketing.
Ukraine has a dense network of Soviet-era pipelines extending into Europe. past line Contract and payment issues have left Europe in limbo due to gas shortages. Sanctions imposed by Russia over its invasion of Ukraine last year have prompted European economies to shun supplies, fearing the Kremlin is exploiting its oil and gas reserves for geopolitical gain.
Shell said the European and British economies absorbed 121 million metric tons of LNG last year, up 60% from 2021, allowing the region to endure shortages of pipeline gas from Russia.
At the same time, due to the control Coronavirus disease The pandemic, but that has changed this year, with the world’s second-largest economy after the United States expected to grow by around 5% this year, rivaling other economies smothered by runaway inflation.
Most of the heavy lifting comes from countries like Norway and the US, the latter quickly build yourself As a leader in LNG exports. The U.S. Energy Information Administration, which is part of the Energy Department, said it expects LNG exports to rise 11 percent from a year earlier.
Global LNG trade totaled 397 million tonnes last year and could reach as high as 700 million tonnes by 2040, Shell said.
“More investment in liquefaction projects is needed to avoid the expected supply-demand gap in the late 2020s,” Shell wrote in the report.
Shell itself has a large LNG portfolio. From a project in Algeria in the 1960s, Shell is now a global leader with its floating Prelude LNG facility, offshore Australia, the largest of its kind in the world.
Shell adjustment net income It was $9.8 billion in the fourth quarter. Most of the growth came from its natural gas segment, which accounted for about 60% of total revenue during the period.
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