THE WALL STREET JOURNAL

 

China News
IEA Says China Natural Gas Demand to Nearly Double
Chinese Demand to Offset Slower Growth Elsewhere
By Selina Williams /June 10, 2014 3:55 a.m. ET

 

LONDON—China's natural gas demand is forecast to nearly double by 2019, offsetting
slower growth in Europe and elsewhere, the International Energy Agency said Tuesday in
its annual medium-term gas market report.


Global gas demand is expected to rise by 2.2% a year by the end of 2019 compared with
2.4% projected in last year's outlook, the Paris-based energy watchdog said.


Liquefied natural gas will meet much of this demand, with new pipelines also playing a role.
In a shift away from the traditional dominance of state-owned suppliers, private-sector
operators in Australia, Canada and the U.S. are taking the lead in the expansion of LNG
trade, which is expected to grow by 40% to reach 450 billion cubic meters by 2019.


Half of all new LNG exports will originate from Australia, while North America will account
for around 8% of global LNG trade by 2019, the IEA said.


"We are entering the age of much more efficient natural gas markets, with additional
benefits for energy security," IEA Executive Director Maria van der Hoeven said.


"While demand growth is driven by the Asia-Pacific region and especially China, supply
growth for the international gas trade is dominated by private investments in LNG in
Australia and North America."


However, high LNG prices are threatening to crimp demand and that could open the door to
increased coal use, she added.


China's power, industrial and transport sectors will drive overall Chinese gas demand to 315
billion cubic meters in 2019, an increase of 90% over the forecast period, the report said.
While China will remain a significant importer, half of its new gas demand will be met from
domestic resources, most of them unconventional. Chinese production is set to grow by
65% to 193 billion cubic meters in 2019 from 117 billion cubic meters in 2013, the report
said.


Meanwhile, in Europe, consumption isn't expected to recover to its 2010 peak over the next
five years due to weak power demand growth and government support for renewables.
Moreover, there will be no meaningful diversification of European gas supplies through the
end of the decade, the report said.


Write to Selina Williams at selina.williams@wsj.com


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