2019 Record Year for LNG FIDs: WoodMac

Wood Mackenzie, the global E&P consultancy, has said it “anticipates 2019 to be the largest year for LNG FIDs (final investment decisions) ever with projects in Russia, Qatar, Mozambique and the US expected to sanction.”

Qatar and Russia’s Novatek have already as good as committed to taking FID on their projects next year.

WoodMac said in a note October 15 that, after a dearth of new greenfield LNG project sanctions in recent years, suppliers are now positioning to grow, with FID on LNG Canada this month being the first major greenfield project to move ahead since 2015.

Average project size to take FID worldwide, at 875mn barrels oil equivalent (boe) in 2018, is over double that of 2017, it adds.

However, on the back of strong demand growth, particularly from China, it expects that Asia-Pacific's oil and gas sector in particular will rebound over the next 12 months amid greater confidence in the region.

"Asia-Pacific matches the trend exactly, with a jump to an average of 287mn boe versus 143mn boe in 2017," said WoodMac upstream research director Angus Rodger, citing key 2018 sanctions as including Malaysia’s SK320 and SK408, Reliance's KG D6 deepwater cluster, and Cnooc's first operated deepwater gas project in China, Lingshui – totalling some $8bn investment. Most of these are projects that will pipe gas into nearby markets, rather than having to liquefy the gas for export.

Southeast Asia and Australasia had seen $6.8bn of upstream deals this year, the highest since 2014, added WoodMac, citing Santos’ $2.2bn Quadrant and OMV’s $0.8bn Malaysian deals. The region’s resurgence of investor confidence was cited by NGW Magazine in early September.