New LNG buyers want shorter and smaller contracts
According to the latest Reuters report, Royal Dutch Shell has said that new LNG customers that will drive demand are looking for shorter and smaller contracts.
Shell expects much of new LNG demand to come from countries that want to replace declining domestic gas production – which has already happened in Egypt and Pakistan – and those countries that are looking at LNG to complement pipeline and domestically produced gas, like China or Morocco.
Shell said it sold LNG into six new markets in 2016, compared with a typical annual rate of 2–3 new national buyers, as countries like Egypt, Pakistan and Jordan chose to import more gas to meet domestic consumption needs.
The new buyers generally need more flexibility in their gas supplies due to uncertainty over demand evolution.
New potential customers this year are Jamaica and Malta, which have built floating storage LNG units, as well as Ivory Coast, where Shell owns a small stake in a new LNG import project.