Why natural gas demand in Asia continues to soar

The Shell-led LNG Canada consortium’s renewed interest in building a $40-billion liquefied natural gas export terminal in Kitimat can be explained by higher-than-expected increases in gas demand in Asia. A current global LNG glut and investments in renewable electrical capacity notwithstanding, global gas demand grew three percent last year and is showing no sign of slowing down. Virtually all that new demand is coming from Asia, where rising incomes are increasing consumption of electricity (and other products derived from gas) at the same time as gas is displacing the traditional source of power, coal. Chinese gas consumption went up a whopping 15 percent in 2017.

“As a result, natural gas was the number one fuel for meeting the growth in primary energy demand in 2017, beating out renewables by 26 percent,” this report from the ARC Energy Research Institute notes.