ENTSOG Gas Regional Investment Plan South 2017 - Main Report

The gap between LNG prices worldwide by January 2017 is much smaller than it was in the past, with prices ranging from 20.09 €/MWh   1) in the United States, to 26.6 €/MWh in Asia, 25.8 €/MWh in South America and around 21.8 €/MWh in Europe. Furthermore, the LNG market will have to adapt to the entry of major new supplies from Australia and the US. Global LNG export capacity in 2020 will have increased by around 40% of the capacity at the end of 2015, with half of the incremental supply capacity available by 2017. In the near future, the adjustment of supply to possibly lower LNG prices may be difficult, since operating costs is a small fraction of the overall investment costs. In this context, possible excessive supply will have to be absorbed by response to the price on the demand side.

 1) Price of LNG exports in January 2017: 6.44 $/cft = 20.09 €/MWh (Conversion Units: 1.062876 $/€; 0.3407 kWh/cft)

Image courtesy of REN

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Gas Regional Investment Plan of the South Region 2017