Conclusion

North American LNG capacity is expected to grow dramatically by 2010. This capacity growth could help offset the decline of existing North American gas fields, and could help moderate price growth. However, the proposed LNG projects will face a variety of legal, engineering, and environmental challenges which could delay or cancel some of the projects. In addition, a variety of supply-side bottlenecks will reduce the average sendout of the proposed terminals. Finally, global competition for LNG supplies may result in continued upward pressure on U.S. gas prices.
For reference, the entire global supply of LNG averaged less than 18 bcfd for 2004 [11]. Even if global LNG shipments increased dramatically by 2010, much of that capacity will likely be locked-in by Japan, South Korea, and other major LNG importers. Thus, it is unlikely that the projected 51 bcfd of North American capacity could be fully utilized by 2010.

Therefore, the proposed LNG terminals will not be a panacea for curing North America’s natural gas shortfall.