Breitling Oil and Gas Morning Podcast #254 3-21-13

A broadening of the Liquefied natural gas market supply base will support anticipated demand growth in the next 10-20 years, although pricing scenarios are likely to change with more price-sensitive buyers becoming less willing to pay supply security premiums.

Algeria, Malaysia, and Indonesia were the first to dominate world LNG supply and then were joined by Qatar and Australia and now the US is coming up.

The third wave could come from as many as 25 other countries, many of which currently have little or no capacity; but by 2020, these countries could provide as much as 30% of the world’s LNG capacity and this includes the US.

I believe diverse new supply sources will change the LNG status quo with Asian buyers who can  replace their expensive long-standing pricing model of gas prices tied explicitly to oil prices.

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