(MENAFN- Gulf Times) Qatar's role as a major global supplier of liquefied natural gas will be further reinforced by the country's recent decision to raise its LNG output by nearly 30%.
Qatar seeks to produce 100mn tonnes of LNG, or about 40% of last year's global supply, up from its current level of 77mn tonnes.
Australia, which has spent $200bn to build LNG-exporting plants, may surpass Qatar as the biggest shipper as early as next year, but lose its leadership by the middle of the next decade given Qatar's latest plans, according to data from Bloomberg New Energy Finance.
As the demand for liquefied gas is growing faster than that for oil, Qatar Petroleum (QP) is doubling to 4bn cu ft a day its target for output capacity at a new project in the North Field, the world's largest non-associated natural gas deposit.
QP has been examining options to increase capacity from its existing LNG plants, or trains as they are called. Currently, efforts are being made to identify modifications that would de-bottleneck capacity at the country's current liquefaction facilities at Ras Laffan.
According to QNB, Qatar remains the number one LNG player in the world despite higher supply from Australia and the US. Qatar's share of global LNG supply stood at 30.1% as it captured nearly 70% of the new African demand.
Qatar's position is likely to be cemented by its recent decision to boost production by 30% over the next 5-7 years, QNB pointed out.
Recently, BMI Research noted that Qatar will play a key role in meeting the burgeoning demand for liquefied natural gas in South Korea.
The Fitch Group company said South Korea's LNG imports are set to grow at an annual rate of 1%-2% over the coming years, as its plans to gradually phase out coal and nuclear-fired power generation drive greater reliance on gas-fired electricity generation.
Data showed that global LNG supply rose by 6.5% compared to virtually zero growth over 2011-2015. Demand growth increased by 4.2%, its fastest rate in the past five years.
The production from the US and Australia is expected to increase substantially, maintaining the state of excess supply in the market.
But subsequently, rising demand from Asia, a concerted global effort to adopt cleaner sources of energy and deferred investments are widely expected to push the market back into balance, potentially even into undersupply, around 2020, QNB noted.
Energy economists cite credible studies and said that between 2021 and 2024 there will be a shortage of gas because of higher demand.
On environmental and safety concerns, many countries such as South Korea are gradually phasing out coal and nuclear-fired power generation, which will lead to greater reliance on gas-fired electricity generation.
For this reason, Qatar's decision to scale up LNG production is timely and is in line with market realities.
Qatar, as one of the most nimble and cost-efficient producers, is well positioned to take advantage by boosting its production as the market rebalances.
Obviously, the commitment to boost long-term production will solidify Qatar's position as the global LNG leader.
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