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China gas markets long-term outlook H2 2018

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08 January 2019

China gas markets long-term outlook H2 2018

Report summary

China's gas market maintained its growth momentum in 2018. We estimate total gas demand grew by around 15% year-on-year. Despite this rapid demand growth, China has been better prepared to supply gas this winter. And with milder temperatures, we haven't seen a repeat of last winter's supply crunch so far. We expect the strong gas demand growth to persist through the medium term, although the growth rate will level off given the higher base and infrastructure constraints. Longer term, gas demand will grow to 698 bcm by 2040 - 21.5 bcm higher than our H1 2018 outlook. In this update, we've downgraded domestic gas production in light of slow progress in conventional discovery and increasing downside risks to unconventional ramp-up. China's gas import dependency is expected to rise from 42% in 2017 to 48% by 2040. LNG demand is forecast to reach around 70 mt by 2020 and 115 mt by 2040.

Table of contents

  • Coal-to-gas switching keeps creating demand, subject to supply constraints
  • Strong LNG demand growth sustained but infrastructure remains a drag
  • Chinese buyers to shape global LNG trends
  • Central Asian gas imports unlock capacity bottlenecks
  • Russian gas imports will be a stronger competitor to LNG in northern China
  • Domestic conventional gas production ramp-up outpaced by demand growth
  • Unconventional gas develops slowly as challenges remain
  • What's changed – H1 vs H2
  • Related reports

Tables and charts

This report includes 8 images and tables including:

  • Total gas demand
  • Gas Demand by Sector H2
  • Power Capacity
  • Power Generation
  • China Conventional Supply Outlook
  • China Unconventional Supply Outlook
  • China LNG Imports Outlook
  • China Pipeline Imports Outlook

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