U.S. LNG Export Outlook To China, Impact On Cheniere Energy
The biggest market for LNG in Asia is Japan, but China’s aggressive move toward natural gas for power generation is expected to make China the largest source of demand growth for both pipeline gas and LNG. The switch from dirty coal power generation to clean gas generation is currently underway with vigor. China holds great promise to tighten the LNG market longer term, which now appears to be in surplus through 2020.
The most noteworthy part of the November 2014 Climate agreement between the US and China was China’s goal of capping coal consumption in 2020. This is very telling and signals that the outlook for natural gas generation is very strong in China long term.