China's Imported LNG Market to Grow at CAGR of 15% in Next Five Years

Market for imported LNG in China is expected to grow at a CAGR of over 15 percent during 2016 - 2021, due to increasing peak saving demand from residential consumers for space heating requirements and rising demand for integrated LNG power plants. 

According to a report by TechSci Research titled “China LNG Market Demand & Supply Analysis, By End-User, By LNG Terminals Forecast and Opportunities, 2011 – 2021”, increasing consumption and limited natural gas production is projected to generate huge demand for LNG in the country.

Domestic gas output is also expected to increase on account of various new gas discoveries. In China, majority of the natural gas fields are situated onshore in western and north-central parts of the country. The Chinese government is spending heavily on exploration and production activities such as 2D and 3D seismic surveys, in order to explore proved reserves and address the growing domestic requirements for natural gas, TechSci Research said.

In 2015, domestic natural gas contributed around 69 percent share in total natural gas consumption in China, while the remaining was addressed by LNG and cross-country natural gas pipeline imports. In 2015, industrial sector accounted for the largest share in the country’s total natural gas consumption, owing to rising natural gas demand from heavy industries, smelting & pressing of ferrous metals, petrochemical plants, processing of petroleum, coking and processing of nuclear fuel and petrochemical plants.

East China registered the highest consumption of LNG from the industrial, power and petrochemical sectors. The region has 14 natural gas based power plants with an installed capacity of 13,843.6 MWe and five operational LNG terminals, with a combined receiving capacity of 17.53 million metric tonne per annum (MMTPA).