CPABC Industry Update Summer 2014 - Page 15

Shipping Industry cooling it to -163 degrees Celsius at a liquefaction plant, thereby reducing the volume of the gas by 600 times. The reduced volume allows for the efficient storage and transportation of natural gas by ship over long distances, enabling countries with limited natural gas reserves or limited access to long-distance transmission pipelines to meet their demand for natural gas. LNG is transported by sea via dedicated LNG carriers. These doubled-hulled ships feature a sophisticated containment system that holds and insulates the LNG in order to maintain its liquid state. LNG that evaporates during the voyage and converts back to natural gas (called boil-off ) is used as fuel to help propel the carrier. At the end of the voyage, the LNG is unloaded and turned back into its gaseous form at a regasification facility. In 2013, a total of 237 million tonnes of LNG was shipped worldwide. Most of the demand for LNG comes from Asia, which accounts for 75% of global imports. Japan is by far the largest consumer of LNG, importing 88 million tonnes in 2013, or 37% of the global total. South Korea is the world’s second largest importer, while China and India are becoming increasingly important importers of LNG and are expected to be the main drivers of demand in the future. On the supply side, 17 countries currently export LNG. The largest LNG exporter is Qatar, whose 78 million tonnes of exports in 2013 accounted for one-third of the global total. Other important LNG exporters include Malaysia, Australia, and Indonesia. Looking ahead, Australia is expected to overtake Qatar as the world’s largest producer of LNG in the next few years, while North America – including both the United States and Canada – is expected to emerge as a significant supplier of LNG by the end of the decade. A fleet of around 400 dedicated LNG carriers is used to transport LNG across the world every day. A standard LNG carrier can transport approximately 150,000–170,000 cubic metres of LNG, although the largest vessels in the fleet can carry up to 265,000 cubic metres. LNG carriers are complex vessels to construct compared to bulk carriers or tankers and, as a result, are more expensive; the average price for a new LNG carrier is approximately $200 million. Most LNG carriers are built by shipyards in South Korea, although a small number of vessels are also built in Japan and China. Ownership of the L 9