lng: demand opportunities and supply challenges · nigeria lng: rapidly growing capacity plant...
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Cop
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ht: SI
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LNG: Demand opportunities and supply challenges
Kathleen Eisbrenner
Executive Vice-President, Global LNG
Shell Gas & Power
EIA 2008 Energy Conference
Washington D.C., 7th April 2008
The energy challenge
• Population growth
• Economic growth
• More affluent society
• End of ‘easy oil’
• Resource nationalism
• More unconventionals
• Hydrocarbons remain dominant
• CO2 consequences
1. RISING DEMAND 2. SECURITY OF SUPPLY 3. ENVIRONMENT & SOCIETY
Major economies are climbing the energy ladder
The growing role of LNG
0
1000
2000
3000
4000
2000 2006 2010 2020
TCF
Indigenous & Pipeline Imports LNG % increase over 2000
344%
53%
Sources: BP Statistical Review 2007, CERA 2006, EIA 2006
Global market developments
Shell analysis
TODAY2012
29
2012
LNG importers
# Countries
70.6%17
% increaseTODAY
.
.
.
.
.
.
.
LNG importers
LNG exporters
Supply challenges
• Growing energy demand
• Natural gas exporting countries
• Competition with exports
• Skyrocketed costs
• Construction delays
• More complex projects
• Large integrated projects
• Technical and project management challenges
1. DOMESTIC DEMAND 2. HIGH EPC COSTS 3. PEOPLE AND SKILLS
Energy sector inflation
INDEX (2000 = 100)
80
100
120
140
160
180
200
220
2000 2001 2002 2003 2004 2005 2006 2007 2008
Q3 2007
Q1 2007
Q3 2006
CERA Upstream Capital Cost Index (UCCI)
People and skills to deliver complex projects
Construction of Pearl GTL at Ras Laffan Industrial City in Qatar
Global market developments
Shell analysis
TODAY2012
18
29
2012
70.5%17LNG importers
LNG exporters
# Countries
20%15
% changeTODAY
.
.
.
.
.
.
.
LNG importers
LNG exporters
Nigeria LNG: Rapidly growing capacity
PLANT CAPACITY (YEAR END 100%, MTPA)
0
5
10
15
20
25
1999 2001 2003 2005 2007
Sakhalin II: World’s largest integrated oil and gas project
Floating LNG (FLNG)
• Unlocking stranded offshore gas accumulations
• Small environmental footprint
• No pipeline or dredging
• Limited onshore support base
• Cyclone tolerant
• Redeployable
Shell’s global LNG portfolioLeading position … and 5 new trains under construction
LNG SUPPLY:
IMPORT CAPACITY:
OPERATION CONSTRUCTION
Start up 2008
NLNG T6
Start up 2010+
Qatargas 4
Start up 2008-09
Sakhalin T1 & 2
Start up 2008
NWS T5
Start up 2010+
Pluto