smh.com.au
Australian LNG Exporters Predict 50-60% Demand Surge Despite Oversupply Risks
Australia's top LNG exporters, Shell and Woodside, forecast a 50-60 percent rise in global LNG demand by 2034-2040, fueled by Asia's economic expansion and coal-to-gas power plant transitions, despite concerns about oversupply and high LNG prices.
- How do the predictions of increased LNG demand reconcile with concerns about its role in the global energy transition and the potential for oversupply?
- This growth projection stems from Asia's increasing LNG import capacity (China adding connections for 150 million by 2030, India 30 million in five years) and plans to replace coal-fired power plants with less-emitting gas alternatives. Woodside estimates that a 20 percent coal-to-gas switch in Asia would reduce emissions by 680 million tonnes annually—exceeding Australia's yearly net greenhouse gas emissions.
- What are the key drivers and projected growth of global liquefied natural gas (LNG) demand in the next decade, and what are the immediate implications for Australia's LNG exports?
- Australia's largest oil and gas exporters, Shell and Woodside, predict a substantial increase in global liquefied natural gas (LNG) demand—60 percent by 2040 (Shell) and at least 50 percent by 2034 (Woodside)—driven by Asia's economic growth and rising energy needs. This surge is expected despite ongoing debates about the fossil fuel's role in the energy transition.
- What are the significant economic and environmental barriers that could hinder the projected growth in LNG demand, and what are the long-term implications for Australia's LNG industry?
- However, this forecast faces challenges. High LNG prices (around $US13 per million BTU) hinder its competitiveness against coal, potentially limiting its ability to displace coal across Asia. Furthermore, decreased LNG demand in Japan and scaled-down LNG-to-power plans in Vietnam suggest a potential oversupply risk in the coming years as new projects in the US and Qatar come online.
Cognitive Concepts
Framing Bias
The article is framed to emphasize the projected growth in LNG demand, prominently featuring the positive forecasts of Shell and Woodside. The headline (not provided, but inferred from the content) likely emphasizes the increase in demand. The positive statements from Shell and Woodside are placed early in the article, giving them significant weight. Concerns regarding cost and potential oversupply are presented later, diminishing their impact. The use of quotes from executives adds to the positive framing.
Language Bias
While the article strives for objectivity, there's a slight tendency to present the positive forecasts more emphatically. Phrases such as "significant lift in demand" and "surged following Russia's invasion" carry a positive connotation. The use of "engine room for LNG growth" is also evocative and positive. More neutral phrasing could be employed, such as "projected increase in demand" and "increased following Russia's invasion.
Bias by Omission
The article focuses heavily on the projections of increased LNG demand by major Australian exporters, Shell and Woodside, and gives less weight to counterarguments or alternative perspectives. While it mentions Christopher Doleman's concerns about cost and potential oversupply, this perspective is presented later in the article and is less prominent than the optimistic forecasts. The article omits discussion of potential technological advancements in renewable energy that could further reduce the reliance on LNG. The potential impact of stricter environmental regulations globally on LNG demand is also not thoroughly explored.
False Dichotomy
The article presents a false dichotomy by framing the debate as either increased LNG demand driven by Asia's energy needs or a potential oversupply due to new projects. It simplifies the complex interplay of factors influencing future LNG demand, including technological advancements, policy changes, and economic shifts. The article doesn't adequately explore intermediate scenarios or nuanced perspectives on the future role of LNG.
Sustainable Development Goals
The article highlights a significant projected increase in LNG demand, driven by Asian economic growth and a potential shift from coal to gas in power generation. While gas is considered a transitional fuel, less polluting than coal, its continued use contradicts efforts to curb greenhouse gas emissions and transition to renewable energy sources. The increase in LNG production and consumption will contribute to higher greenhouse gas emissions, hindering progress toward climate goals. The article also mentions potential barriers to widespread gas adoption, such as cost and competing renewable energy sources, but the overall trend points towards increased fossil fuel use and negative impacts on climate action.