Market Outlook for Gas & LNG Key Growth Markets Presentation by Philip Olivier CEO of ENGIE Global LNG Tokyo, 5 April 217, GASTECH
Agenda Chapter 1 Global gas market: An abundant supply Chapter 2 Key geographical LNG growth markets: A natural expansion of the scope Chapter 3 Building LNG growth markets: Extend the usage
Global gas market: An abundant supply
Industry consensus: global LNG market has entered into a period of oversupply Global gas demand Global LNG demand vs supply 5 4 CAGR 215-22 2.3% Africa Supply CAGR 215-22 8% CIS 3 2 APAC CAGR 215-22 4% Asia Pacific Middle East Latin America 1 Europe North America 21 215 22 225 Source: IHS, ENGIE 4
Key geographical LNG growth markets: A natural expansion of the scope
LNG infrastructures as of 1995 Regasification Terminal Liquefaction Plant 9 importing countries 8 exporting countries Source IHS CERA, GIIGNL 6
LNG infrastructures as of 2 Regasification Terminal Liquefaction Plant 11 importing countries 12 exporting countries Source IHS CERA, GIIGNL 7
LNG infrastructures as of 217 Regasification Terminal Liquefaction Plant 4 importing countries 19 exporting countries Source IHS CERA, GIIGNL 8
What are the characteristics of a «key growth market»? 1 Growing demand 2 Existing or expected infrastructure 3 Market design F S R U Demographic growth Economic growth production Depletion of domestic fields switch Switch from oil/coal to gas 9
Areas that can be described as key growth markets Regasification Terminal Liquefaction Plant Source IHS CERA, GIIGNL 1
GDP growth (2 = 1) Latin America, urgent but limited needs Gas consumption forecast LNG demand 3 GDP CAGR 21-2251.3% 3 3 2 2 2 LNG demand CAGR 215-234.7% 1 1 1 2 25 21 215 22 225 23 Production () Gas consumption () GDP growth (base 1 in 2) Source: IHS Rivalry July 216 2 25 21 215 22 225 23 Source: IHS Rivalry July 216 Regasification capacity LNG import contracts switch 8 21-22 +151% 8 F S R U 4 4 Regasification Terminal Liquefaction Plant LNG importing country positive impact neutral/balanced impact negative impact 2 25 21 215 22 225 23 2 25 21 215 22 225 23 Source: IHS 217, ENGIE internal estimate Source: IHS 217 11
GDP growth (2 = 1) The Middle East is attracting LNG in the short term Gas consumption forecast LNG demand 9 GDP CAGR 21-2252.2% 4 9 6 3 2 6 3 LNG demand CAGR 215-237.3% 2 25 21 215 22 225 23 Production () Gas consumption () GDP growth (base 1 in 2) Source: IHS Rivalry July 216 2 25 21 215 22 225 23 Source: IHS Rivalry July 216 switch Regasification capacity LNG import contracts 8 21-22 +697% 8 F S R U 4 4 Regasification Terminal Liquefaction Plant LNG importing country positive impact neutral/balanced impact negative impact 2 25 21 215 22 225 23 2 25 21 215 22 225 23 Source: IHS 217 Source: IHS 217 12
GDP growth (2 = 1) World LNG growth will be fueled by Asia-Pacific non-oecd countries in the medium to long term Gas consumption forecast LNG demand 1 9 1 75 5 GDP CAGR 21-2253.7% 6 75 5 LNG demand CAGR 215-23 8.3% 25 3 25 2 25 21 215 22 225 23 Production () GDP growth (base 1 in 2) Gas consumption () Source: IHS Rivalry July 216 2 25 21 215 22 225 23 Source: IHS Rivalry July 216 switch 16 12 Regasification capacity 21-22 +668% 16 LNG import contracts F S R U 8 8 Regasification Terminal positive impact 4 Liquefaction Plant neutral/balanced impact 2 25 21 215 22 225 23 2 25 21 215 22 225 23 LNG importing country negative impact Source: IHS 217 Source: IHS 217 13
GDP growth (2 = 1) Europe: possibly the fastest growing LNG market in the near future Gas consumption forecast LNG demand 9 4 9 6 GDP CAGR 21-2251.% 2 6 LNG demand CAGR 215-235.2% 3 3 2 25 21 215 22 225 23 Production () Gas consumption () GDP growth (base 1 in 2) Source: IHS Rivalry July 216 2 25 21 215 22 225 23 Source: IHS Rivalry July 216 Regasification capacity LNG import contracts switch 28 21-22 +67% 28 21 F S R U 14 14 Regasification Terminal Liquefaction Plant LNG importing country positive impact neutral/balanced impact negative impact 7 2 25 21 215 22 225 23 2 25 21 215 22 225 23 Source: IHS 217 Source: IHS 217 14
Building LNG growth markets: Extend the usage
The traditional gas value chain NG transportation & distribution Natural gas as primary energy Natural gas for vehicles (NGV) Pipe transfer Standard liquefaction plant Regasification terminal Injection in grid Domestic use Private & Utility vehicles Gas treatment Standard LNG carrier Standard storage LNG transfer Industrial end user Caption Gas field Gas treatment Power plant 16
is extended by the new uses of LNG NG transportation & distribution Natural gas as primary energy Natural gas for vehicles (NGV) Pipe transfer Standard liquefaction plant Regasification terminal Injection in grid LNG transportation & distribution Domestic use NG / LNG as primary energy Private & Utility vehicles LNG as a fuel LNG transfer Gas treatment Standard LNG carrier Standard storage LNG feeder Small storage LNG bunker vessel/barge LNG Truck Injection in grid Industrial end user Merchant vessel Plane Caption Power Gas field Biogas Gas Small treatment liquefaction (LNG or LBM) Rail Waterways Small storage Power plant Cold ironing Mining truck and other high power applications Locomotive Gas grid Fueling station Truck 17
Can we upgrade a market to «key growth»? NG transportation & distribution Natural gas as primary energy Natural gas for vehicles (NGV) Existing or expected 1 Growing demand 2 infrastructure 3 Market design LNG transportation & distribution NG / LNG as primary energy LNG as a fuel LNG Boost conversion to gas in coal- or oil-dependent countries Power Invest in downstream infrastructure in order to secure new LNG demand Small storage Advocate the role of natural gas 18
Conclusion No need to wait for the demand, Track it and create it! 19
Thank you 2