China has surpassed South Korea to become the world’s second-largest importer of Liquefied Natural Gas (LNG).
The country imported 38.1 million tonnes of LNG in 2017, increasing 50 per cent from the previous year and edging ahead of South Korea’s 37.6 million. While Japan still leads as the biggest importer at 83.6 million tonnes, China’s growth is indicative of a trend to become the leading importer of LNG.
Government driven growth
In 2011 China was importing just 12 million tonnes of LNG, a third of South Korea’s imports at the time. The Chinese government began urging manufacturing plants to replace coal with natural gas to reduce pollution. Seen as a bridging fuel, LNG is low cost, easy to source in large quantities and less damaging to the environment. As China’s air pollution is driving respiratory problems, contaminating drinking water and causing illness, LNG plays a strong role in a low-carbon future for the country.
The shift has triggered unprecedented demand for natural gas, which China’s storage and pipeline infrastructure was unable to handle. Chinese utility companies instead were forced to turn to international markets, importing vast quantities of LNG.
Will it last?
Currently coal makes up 60 per cent of China’s energy mix, while natural gas accounts for six per cent. By 2030 the government plans to raise the proportion of natural gas to 15 per cent while lowering that of coal to 49 per cent or less.
While the global supply of LNG is currently outpacing demand, industry leaders are predicting supply will fail to keep up in 2022 because of China’s increasing dependence on LNG. Instead, China may have to turn to investing in new LNG projects. The country currently imports LNG from Australia and Qatar, but it is reportedly considering an LNG project in Alaska as well. China is predicted to surpass Japanese imports of LNG by 2030.
During this rapid expansion, it is crucial that LNG is accurately measured and managed throughout its cooling, storage and transportation.
