Shell: LNG Demand to Rise by 50% by 2040, US Can Play a Major Supply Role if...

Shell released a new study Wednesday in which it finds that global demand for liquefied natural gas (LNG) is likely to rise by 50% by the year 2040. Shell projects total global demand for the precious commodity will rise to between 625-685 million metric tons per year over the next 16 years, with the biggest demand growth expected to come from China, South Asia and Southeast Asia.

"China is the market that we are most bullish about this decade. And one of the reasons for that is the massive amount of new gas infrastructure that is coming on stream at the moment," Steve Hill, Executive VP for Shell Energy, told analysts.

While usage of natural gas is projected to peak in the US and Canada at some point in the 2030s, Shell finds demand for LNG continuing to grow across Asia and Africa throughout the 2040s and beyond. Not surprisingly, the study sees the most significant jumps in natural gas usage taking place in power generation and industrial applications. LNG imports into developing nations can be especially beneficial in terms of overall emissions since they are typically used to displace coal in power generation.