Southeast Asia Expected to Drive LNG Demand by 2030
Industry experts predict that Southeast Asian countries will play a crucial role in driving demand for liquefied natural gas (LNG) by 2030. In 2022, global trade in LNG reached a record high, primarily due to increased demand from Europe as the region sought alternative energy sources following tensions with Russia. However, it is anticipated that Europe’s demand for LNG will decrease in the coming years.
The Potential of Southeast Asia
Tony Regan, the Asia-Pacific gas lead from NexantECA, believes that Southeast Asia, particularly Vietnam, Thailand, and Indonesia, will be the key players in the LNG market. Vietnam, in particular, is expected to experience significant growth in LNG demand due to the government’s Power Development Plan 8, which mandates the conversion or retirement of all coal plants by 2050. Regan predicts that Vietnam’s plans to build 13 new LNG-fired power plants, along with 10 gas-fired plants, will create a strong pull for energy in the country.
“By 2033, Southeast Asia LNG demand is forecast to be 73 million tons per year, making up 12% of the global LNG market. This is almost a quadrupling of demand compared to 2022.”
– Zhi Xin Chong, S&P Global’s Head of Emerging Asia’s Gas and LNG markets
The Importance of Vietnam
Vietnam has long been identified as a significant growth market for LNG due to its strong economic and population growth. The country’s GDP is projected to surge from $327 billion in 2022 to $760 billion by 2030. Shell, an energy giant, has observed substantial growth in the LNG market and highlighted Germany, Vietnam, and the Philippines as key drivers. These countries have recently received their first LNG cargoes, solidifying progress in their LNG ambitions.
The Future of Southeast Asia’s LNG Market
According to Zhi Xin Chong of S&P Global, Southeast Asia’s LNG demand is expected to reach 73 million tons per year by 2033, accounting for 12% of the global LNG market. This represents a significant increase compared to 2022. The growth story is driven by a decline in domestic gas supply and the transition from coal to gas in the power sector. However, Chong emphasizes that demand in these markets remains fragile and reliant on stable prices and adequate funding for infrastructure development.
Editorial Team
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