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Roundup: Liquified natural gas industry in robust health, growing strong

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Abundant, environmentally sound and affordable gas will increasingly become part of the world's energy mix -- a good thing for the planet, the global economy and the industry itself, say experts at the world's biggest conference for the liquified natural gas (LNG) business that concluded here Friday.

About 360 vendors and leaders of the industry across the globe presented seminars, exhibits, publications and interactive glimpses of their products at the four-day 17th International Conference and Exhibition on Liquefied Natural Gas in Houston.

"The conference brings together all the players from all segments of the LNG value chain where innovation and solutions can be shared and discussed to gain understanding on how LNG can provide broader solutions to the world energy challenges," said Kerry B. Erington, senior vice president and director of B&V Energy's business unit.

Andrew Brown, Upstream International director of Royal Dutch Shell -- the lead sponsor of this year's conference -- outlined in a keynote address what industry and policymakers must do to ensure gas becomes the leading source of global energy.

Brown said it was fitting that the largest liquefied natural gas conference ever is being hosted in the United States, a country that recently became the largest gas producer in the world.

"I believe the LNG industry has never been in better shape: it is an industry that is as robust and as dynamic as ever," Brown said. "I also believe that we are seeing unparalleled innovation in our industry creating new sources of supply and demand for LNG."

Brown said that today, the world has enough gas for 250 years at current consumption rates.

"The U.S. alone has over 100 years of natural gas supplies at today's consumption rates," he said. "We believe gas demand will increase by some 60 percent from 2010 to 2030, with demand in Asia and the Middle East doubling in that period and China gas demand increasing almost five-fold."

LNG will play an increasingly important role in linking supply centers with the demand centers as the volumes of gas supply and demand increases, Brown said.

"We expect LNG demand to double between now and 2025," he said. "We see gas as a long-term destination fuel in the global energy mix, especially when combined with renewables."

"Demand is growing and I see more investments in the future in countries like the United States and the continent of Africa," said Angel Ojeda, staff engineer with ConocoPhillips. "The price will increase as well."

Chris McCullough, vice president of marketing for John M. Campell Petroskills, which provides technical training for engineers and operators in the energy field, said his company recently conducted a survey that showed respondents believe the development of floating LNG facilities will be a significant game-changer in the business.

"The responses showed optimistic expectations that the LNG growth rate will be sustained at 5 to 7 percent, suggesting that the volume of LNG trade in 2020 would be around 450 million tons per year," McCullough said.

It is believed that by 2017, the United States will be a major exporter of LNG. By 2025, there will be 2.5 million more people in the United States who are in need of renewable energy.

"By 2025, we believe North American exports could comprise some 15 percent of global LNG supply," Brown said. "These developments are a testament to the resilience of the industry, demonstrating its ability to cope with such a major swing in supply and demand balances."

While the European market's thirst for natural gas and LNG has declined over the past two years as the United States has exported cheap coal there, there is an increasing demand for natural gas in the Far East, with new LNG markets open on a regular basis from Thailand to Indonesia to Malaysia.

In the Middle East, the opportunity to create a cheaper and more environmentally acceptable alternative to burning oil is clear, he said, adding some countries have started importing LNG.

"I have no doubt that eventually Europe will see the immense value in natural gas and renewables and these energy sources will take their rightful place at the core of European energy supply, particularly for power generation," Brown said. "It is our belief that the Far East, the Middle East and Europe will provide strong LNG demand for the medium and long-term future."

Innovation in the LNG field is also increasing at a significant rate in LNG supply and demand, Brown said.

"Demand and applications will only grow," said Andrew Stevenson, Shell's international global accounts manager. "Many of our commercial companies are investing resources in the expectation that LNG will support their goals of energy cost reductions and reduced emissions."

The innovation that allows Shell to put smaller liquifying plants in different places is going to revolutionize the industry, Stevenson said.

In a popular booth of Chart Energy and Chemicals, Inc., Steve Sendelbach helped visitors get seated and operate a race car simulator that allowed the driver to simulate driving in the Indianapolis 500 race at up to 200 miles per hour.

"This is an LNG-fueled race car simulator," Sendelbach said. "It's not your Toyota Prius." Endi